Hong v Auckland Standards Committee No.3

• Jurisdiction: New Zealand
• Judge: The Hon Justice Kós
• Judgment Date: 14 October 2015
• Neutral Citation: [2015] NZHC 2521
• Docket Number: CIV-2014-404-3006
• Court: High Court
• Date: 14 October 2015

Between

Boon Gunn Hong

Plaintiff

and

Auckland Standards Committee No 3

First Defendant

Lawyers and Conveyancers Disciplinary Tribunal

Second Defendant

[2015] NZHC 2521

CIV-2014-404-3006

IN THE HIGH COURT OF NEW ZEALAND

AUCKLAND REGISTRY

Application for judicial review of a determination of the first respondent Standards Committee which held that the plaintiff solicitor's conduct was unsatisfactory — the plaintiff had acted for a client in a lease dispute — the landlord attempted to re-enter premises and evict the client — the plaintiff had advised his client the landlord could not forcibly re-enter the premises if the client did not peaceably give them up — the plaintiff had also asserted to the police that forcible re-entry by the landlord would be “illegal” — the client assaulted the landlord and was convicted in the District Court (DC) — the DC Judge was critical of the plaintiff's advice to his client — the Law Society commenced an own motion investigation — a complaint was laid that the communications with the police were inaccurate — the committee's determination instead focussed on alleged inaccuracy of the advice to the client — the committee did consider information from the plaintiff as to the actual advice given or its accuracy — the plaintiff failed to comply with the Committee's order that he attend a seminar — the second defendant Tribunal held that the plaintiff's failure to comply with the order amounted to misconduct — whether the Committee had failed to take account of relevant evidence by only taking account of the DC judgment.

Counsel:

Plaintiff in person

P N Collins for First Defendant

No appearance for Second Defendant (abides outcome)

JUDGMENT OF The Hon Justice Kós

1 The Ocean Star was an Auckland restaurant. For many years it was successful. In 2005 its owner, a Mr Bill Chan, renewed the lease for eight years. But times changed. Financial difficulties developed. The rent ended up in arrears. Notice of cancellation of the lease was given. In February 2009 the landlord made the first of four attempts to re-enter the premises and evict Mr Chan. Mr Chan was advised by his solicitor, the plaintiff, Mr Hong. The fourth attempt was successful. During it Mr Chan assaulted two of the landlord's agents.

2 In convicting Mr Chan the District Court Judge criticised advice given by Mr Hong. He referred Mr Hong's conduct to the Law Society. Its Auckland Standards Committee No. 3 found the conduct unsatisfactory. It said Mr Hong's conduct with Mr Chan was “imprudent” and “incited or could have the potential to incite his clients into criminal actions”.

3 Mr Hong now seeks judicial review of the Committee's determination. Was that determination lawful?

Background

4 Mr Hong has practised property and commercial law in New Zealand since 1990, and on his own account since 1992. He has acted for Mr Chan since 1996. He did not act on the criminal charges brought against Mr Chan.

5 On 19 January 2009 the landlord served a notice of intention to cancel the lease, requiring payment of the arrears within 10 days. The arrears were not met.

6 According to the response to the complaint he filed with the Committee, Mr Hong received a call from Mr Chan on 4 February 2009. Mr Chan said the landlord was at the restaurant premises with a locksmith, seeking to evict him. An employee had prevented the locks being changed. That was the first attempt at eviction.

7 Mr Chan told Mr Hong that some customers owed the restaurant substantial sums. Given time to collect outstanding sums, he could clear the arrears and stave off eviction.

8 At first Mr Hong advised that Mr Chan could allow the landlord to re-enter and subsequently apply for relief against termination of the lease. Mr Chan was not attracted to this course of action. Any discontinuity would destroy his business. So Mr Hong devised some alternative advice.

9 He advised Mr Chan that the landlord could not forcibly re-enter the premises if Mr Chan would not peaceably give them up. The landlord would need a possession order from this Court to re-enter in those circumstances. 1 He told Mr Chan to secure the premises to prevent the landlord entering it. This would, Mr Hong thought, avoid physical confrontation and any altercation. Mr Hong knew

that Mr Chan had a fiery temper. He said he was concerned to avoid a physical confrontation that might lead to an altercation. 2

10 The same day Mr Hong received a copy of a notice of termination of the lease from the landlord's solicitors. He replied immediately, advising that his client:

The letter was explicit that this strategy was to “buy [his] client the few days it needed to be put in funds”.

• (a) would shortly be able to meet the arrears;

• (b) was “not prepared to give up the premises peacefully” in the meantime; and

• (c) would secure the premises by posting “manpower to be on the premises twenty four hours, 7 days a week, to repel any attempts to re-enter.”

11 Mr Hong says he met Mr Chan that evening and advised that violence had to be avoided. Such behaviour could lead to criminal charges. Mr Hong's strategy required that someone remain on the premises at all hours. Because a landlord may not use force to evict a tenant, and because the tenants would not acquiesce to non-forcible attempts to get them out, the landlord would be compelled to seek an order for possession.

12 Mr Hong told the Committee that he counselled Mr Chan against confrontation or violence:

• 46. As I was worried physical confrontation and altercations would take place, I advised him that landlords will usually attempt at re-entries at odd hours during twilight when the place is quiet. I wanted him to secure the Premises so as to prevent the landlord and its security agents entering the Premises as then the parties would meet physically and altercations could ensue.

• 47. Bill instructed he will post man-power to secure the premises 7 days 24 hours to prevent the landlord re-entering and to repel any forcible re-entry attempts by the landlord.

• …

• 51. Later that evening Bill came up with Lee, his manager, to my office and in our meeting, I again advised them:-

  • a. Of the requirement to avoid any physical violence;

  • b. Either party who commits such violence could be charged;

  • c. The need to secure the Premises particularly twilight so the two parties do not meet (to prevent physical altercations) and as such either Bill or Lee, must be present at all times. Bill and Lee will take turns;

  • d. To contact me if there were any such attempts during business hours;

  • e. If they were forcibly evicted, such as being carried away, they must repel that by shrugging off such attempts and hanging on to whatever they could to prevent being carried away and under no circumstances must they hit anyone unless physically hurt (with proof of bruises) in which case they can use similar force in self-defence to prevent such assault on them.

13 Passing over an intermediate and inconclusive exchange of correspondence, the next day, 5 February 2009, Mr Hong received a call from Mr Chan informing him that the landlord was again at the premises. Again the landlord sought to evict Mr Chan, but this time with the aid of the police. Mr Hong had Mr Chan hand the phone over to a member of the police in attendance. He warned them off from assisting the landlord.

14 He then sent the following fax to the restaurant, which was handed to the attending officers:

To NEW ZEAALAND (sic) POLICE

On-site at 201 Victoria Street Auckland

RE: VICTORIA 2033 LIMITED – SKY OCEAN CHINESE RESTAURANT LIMITED

• 1. I refer to my telephone conversation with the Police Constable.

• 2. This is to confirm my advice that the Landlord's attempt to forcibly re-enter yesterday is illegal and did nto (sic) succeed as my client tenant is still in possession.

• 3. In order to gain re-possession of the premises the Landlord must seek an order from the High Court.

• 4. The New Zealand Police does not have the authority and power to assist the Landlord unless it is served with such an order from the High Court.

• 5. I have been instructed that the Landlord is now attempting to change the locks with the assistance of the Police's presence.

• 6. This too is illegal. Locks could not be changed whilst my client remains in possession. These locks will be removed if changed.

• 7. I trust the Police will not intervene in this civil matter.

Yours faithfully

B.G. HONG

15 The landlord and police left without evicting Mr Chan.

16 That afternoon Mr Hong wrote again to the landlord's solicitors:

RE: VICTORIA 2003 LIMITED-SKY OCEAN CHINESE RESTAURANT LIMITED

• 1. I refer to your earlier fax.

• 2. I do not accept your views at all.

• 3. My client has remained in possession of the premises at all times. As advised earlier, there will be manpower on the premises 24 hours 7 days a week from hereon until this lease termination issue has been resolved.

• 4. The locks will be reverted in due course.

• 5. You ought to be totally aware, the High Court will, on application reinstate the lease if your client refuses to rescind its termination.

• …

• 11. I have written to the Police and served notice on them that they do not have the authority to evict my client other than pursuant to an order to do so from the High Court. They have left the premises with my client still in possession of the Premises.

17 The next day Mr Hong received another call about another eviction attempt. Someone had knocked on the door of the premises at 3am. Mr Chan's own entry was prevented at 7am by a group of people. Possibly the same group which visited at 3am. The police arrived, summoned by a passerby. Police were shown the fax of 5 February. The visitors and the police left.

18 Some months then passed peacefully. This was the calm before the ensuing storm. Taking a leaf from Sun Tzu, the landlord appreciated that the supreme art of war is to defeat...