Mr We v Mr Aw and Mr Ax

JurisdictionNew Zealand
Judgment Date10 June 2013
Neutral Citation[2013] NZLCRO 29
Date10 June 2013
Docket NumberLCRO 82/2012
CourtLegal Complaints Review Officer

Concerning an application for review pursuant to section 193 of the Lawyers and Conveyancers Act 2006

and

Concerning a determination of the Waikato Bay of Plenty Standards Committee

BETWEEN
Mr WE
Applicant
and
Mr AW and Mr AX
Respondent

[2013] NZLCRO 29

LCRO 82/2012

Application for review in respect of a complaint regarding fees charged by law practitioner — practitioner was a friend of applicant — applicant complained that he was under the impression that the practitioner was assisting him in his bankruptcy matter as a friend and was not aware of the fees charged by the practitioner until very late in matter and had not been sent client care information — practitioner produced letter of instructions and letter of engagement to show that the applicant instructed the practitioner and also asked him to instruct a barrister in the matter — whether there was delay in providing the requisite client information and if so, whether it constituted unsatisfactory conduct.

DECISION
Introduction
1

Mr WE's complaint primarily concerned the fees charged to him by Mr AW and Mr AX. Mr AX is a barrister who was instructed by Mr AW. Prior to the review hearing, Mr AX and Mr WE settled the complaint about Mr AX's fees, and Mr WE's complaint about Mr AW's fees was settled during the course of the review hearing.

2

There remains some issues as to Mr AW's conduct which need to be addressed to complete this review.

Background
3

It is unnecessary to relate the facts of the matter on which Mr WE instructed Mr AW and Mr AX, as they have no bearing on the matters complained of.

4

Mr WE's complaints (other than costs) were:-

  • (a) Mr AW did not provide the client information required by Rules 3.4 and 3.5 of the Conduct and Client Care Rules 1 until long after he had commenced working for (and billing) Mr WE;

  • (b) the client information, when provided, did not include Mr AW's (or Mr AX's) hourly rates;

  • (c) Mr AW did not keep him informed about the work that was being conducted on his behalf;

  • (d) Mr AW misled him as to the extent of his involvement once Mr AX was instructed;

  • (e) Mr AW did not follow instructions to make representations to the Official Assignee as to the process to be followed in remitting funds from New Zealand to the [country];

  • (f) Mr AW threatened to disclose confidential information about Mr WE's affairs to the media; and

  • (g) Mr AW did not act competently in representing Mr WE, resulting in Mr WE receiving limited benefit from the services provided by Mr AW.

5

All of the above matters impact on the complaint about fees which was settled between the parties. The Standards Committee did not address any of these conduct issues separately and determined to take no further action in respect of Mr WE's complaint about fees, after considering the Costs Assessor's report.

6

However, for the sake of completeness, the conduct issues do need to be separately addressed and I will undertake that in this review, rather than returning the matter to the Standards Committee to consider.

7

Prior to the hearing (on 27 March 2013) Mr WE was invited to withdraw his application to review the Standards Committee determination insofar as it related to Mr AX, as the complaint about Mr AX's fees had been settled. Mr WE responded that although it had been settled and payment made, Mr AX had not acknowledged receipt of payment. Mr AX was at the review hearing and verbally acknowledged receipt of payment. He indicated he would provide a written receipt if required. On the basis of these acknowledgements by Mr AX, the review as it relates to Mr AX is withdrawn.

8

The complaint as to Mr AW's fees was also settled at the review hearing, and the terms of that settlement were recorded in a Minute issued on 28 March 2013.

Review
9

The parties were initially invited to mediate the complaints and endeavoured to do so. This was not successful, partly I suspect, because Mr WE was at that time residing in England and the mediation lacked the immediacy that would otherwise have been the case.

10

A review hearing took place in Hamilton attended by Mr WE, Mr AW and Mr AX. Mr AW objected to the presence of a support person for Mr WE as he intended to pursue recovery of his fees and there was a possibility that evidence provided or statements made during the course of the review hearing could prejudice these proceedings if statements made during the course of the hearing were known to the support person.

11

I was uncertain as to how knowledge by the support person could affect Mr AW's recovery proceedings, but nevertheless, as the Lawyers and Conveyancers Act provides that review proceedings are private, I acceded to Mr AW's request that the support person be requested to leave the hearing.

12

She was invited to remain outside the hearing room to be consulted at any time during the course of the review by Mr WE if he wished to do so.

Delay in providing client information
13

Rules 3.4 and 3.5 of the Conduct and Client Care Rules provide that a lawyer must “in advance” and “prior to undertaking significant work under a retainer” provide the client with information as set out in those Rules, which includes “the basis on which fees will be charged”.

14

In his letter of complaint, Mr WE notes that Mr AW's bill related to the period commencing on 23 September 2010, but that he did not receive the letter of engagement from Mr AW until 11 November 2010. Mr WE further notes that the letter of engagement provided at that time did not include any charge-out rates for either Mr AW or Mr AX, and that consequently he was not aware of the rates being applied by the lawyers to the work carried out by them until he received an invoice on 6 April 2011.

15

Mr WE and Mr AW were friends. Mr WE states that he was under the impression that Mr AW was assisting him as a friend and that he was not aware that Mr AW was charging him from September 2010. He states that if he had been aware he was being charged (and if he had been informed as to the hourly rates) he would not have continued to consult with the lawyers as he was in no position to pay.

16

In an email to the Law Society dated 17 August 2011 Mr WE states:

[Mr AW] allowed the lines between his former friendship with me and his professional role to become blurred, to the extent I had no idea he was intending all along to charge me for every attendance (notwithstanding his statement that he has not).

17

In his responses to the Law Society Mr AW did not address this issue and similarly made no comment to this Office notwithstanding that I had specifically raised this issue in a letter dated 18 May 2012 when suggesting that the parties mediate.

18

At the review hearing, Mr AW produced two letters of instructions signed by Mr WE. The first was undated, but read:

To [Mr AW]

I instruct you to act for me in these proceedings in court against bankruptcy [?] in England. I [?] you to instruct [Mr AX] as barrister to appear on my behalf, and take care of his fees.

[Mr WE]

From its content, it is clear that these instructions were provided by Mr WE prior to Mr AX being instructed.

19

A second letter was dated 30 November 2010 and reads:

Dear [Mr AW]

Please settle on best established terms a.s.a.p.

Regards [Mr WE]

20

Both letters of instructions are in handwriting and I am unable to ascertain some of the words, and may have misread others. However,...

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