Ms BS v Mr YC

JurisdictionNew Zealand
CourtLegal Complaints Review Officer
Judgment Date13 May 2011
Docket NumberLCRO 152 /2010
Date13 May 2011

LCRO 152 /2010

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


Concerning a determination of the Auckland Standards Committee 4


of Auckland


of Auckland


Application seeking review of a Standards Committee decision that no further action should be taken against the respondent law practitioner, for revealing to his client's brother, in an effort to have his fees paid, that he had completed work for his client who had sought a protection order — whether such conduct by the lawyer was a breach of confidentiality, unprofessional and in breach of r8 Lawyers and Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008 (confidentiality of client information).

Held: Rule 8 Lawyers and Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008 (“Client Care Rules”) provided that “a lawyer has a duty to protect and to hold in strict confidence all information concerning a client, the retainer, and the client's business and affairs acquired in the course of the professional relationship”. In addition, a lawyer had a fiduciary duty towards his/her client the features of which included an imbalance of power, the vulnerability of one party, a relationship of trust and confidence, and an assumption by one party of a duty to act in the other's interests. This duty remained whether or not a lawyer's bills were unpaid.

YC may have drawn incorrect inferences as to the state of knowledge of the BS's family, and that it was not until he advised BS's brother that BS had obtained a protection order, that the brother became aware of this. Given that BS had specifically advised that she did not want her family involved with this matter, YC should have been extra diligent to ensure that any information relating to the steps being taken by him on behalf of BS was not revealed by him. In this regard, it could be said that YC had been careless of BS's right to confidentiality.

The fact that the bill was outstanding was not confidential information belonging to BS, and YC was at liberty to make this known to the brother, and even to seek his assistance in obtaining payment. What he was not at liberty to do, was to reveal the nature of the work that he had undertaken, or that BS had advised that she was unable to pay because of her redundancy, without being sure that the recipient of the email was independently aware of this.

YC had breached the duty of confidence owed to BS. This was a breach of Rule 8 of the Client Care Rules. It followed therefore that this conduct constituted unsatisfactory conduct by reference to s12(c) Lawyers and Conveyancers Act 2006 (“the Act”) which provided that conduct which consisted of a breach of the Act or any of the regulations or practice rules made under the Act, constituted unsatisfactory conduct.

In the circumstances, a censure pursuant to s156(1)(b) of the Act was the appropriate penalty and there was no need for anything further.


The Applicant consulted the Respondent initially in 2007 with regard to problems which she was experiencing with a previous boyfriend [D].


In June 2008 she instructed the Respondent to commence action to obtain a Protection Order. Cost was an important factor for the Applicant and consequently, it was agreed that the work would be carried out by Ms [G], a solicitor employed in the Respondent's office whose charge out rate was less than the Respondent's.


Notwithstanding that Ms [G] was primarily acting, the Respondent maintained close supervision of the work being carried out by her, and was aware at all times of what was occurring in respect of the matter.


The Respondent advised the Applicant that the cost to obtain the Order would be in the region of $1,500, but if difficulties were encountered, then she would be billed for additional work at the rate of $150 per hour.


The Respondent originally intended to apply for the Order on a “without notice” basis and the application and affidavit were filed in June 2008. The Respondent's first bill was sent on 25 June 2008, and was for $1,200 plus GST and disbursements.


The Court declined to allow the matter to proceed in this way and ordered that [D] be served with the proceedings. This proved difficult, and it was ultimately necessary to obtain an order for substituted service.


[D] served a notice of defence and affidavit in support, and it was therefore necessary to proceed to a short fixture hearing which was set down for 31 March 2009.


All of this meant that the original estimate of $1,500 was exceeded.


Further affidavits were filed on behalf of the Applicant, the first being an updated affidavit filed in November 2008, and the second in response to [D's] affidavit in January 2009.


The Protection Order was granted following the hearing on 31 March 2009 and the Respondent sent his final account on 2 April 2009. This was for the amount of $3,500 plus GST and disbursements.


After the initial bill was sent in June 2008, the Applicant had commenced paying the Respondent $250 per month on account of costs. The June bill was cleared by November 2008. Around that time, the Applicant was made redundant and was unable to continue with her monthly payments.


There is some disagreement between the parties as to the contact between them about the non-payment of the second account, but to some extent that is not relevant for these purposes.


The Respondent's account remained unpaid, and in a final attempt to obtain payment, the Respondent sent an email to the Applicant's brother on 1 September 2009 in which he said:–

“Hi [S]

Hope all is well.

Sorry to bother you but I thought I?d mention to you first before going legal on [BS] outstanding invoice.

As you know, we did work for her in respect of securing a protection order. [BS] invoice remains outstanding despite several promises on her part to pay and lately her advice that she has been made redundant and that she can?t afford to pay.

We of course need payment for the work we have done and in most circumstances get the money upfront before we even start work but because [BS] was known to us we did not enforce that policy.

Could you please see into this. I would appreciate it very much. As a last resort mate, we will have to issue court proceedings against her, bankruptcy etc., something that we don?t really want to do.

Cheers [YC]”


When this was unsuccessful, the Respondent instructed debt collectors to recover the debt.


The Applicant lodged her complaint on 27 October 2009.

The complaint and the Standards Committee decision

In a letter dated 30 October 2009 to the Respondent, the Standards Committee identified that the complaint concerned overcharging and poor service.


As the investigation proceeded, the Committee identified a further and predominant aspect of the complaint, which was, that by sending the email referred to in paragraph 13 above the Respondent had breached confidence by informing the Applicant's brother that she had sought a Protection Order and also by indicating that she was in financial difficulties. She also considered that the email contained an element of threat to both her and her family, in that the Respondent advises in the email that if the account was not paid, he would be seeking to bankrupt the Applicant.


After seeking further comment from both parties about the disclosure of confidential information, and conducting a hearing on the papers, the Standards Committee issued its decision. It determined, pursuant to section 152(2)(c) of the Lawyers and Conveyancers Act 2006 (Lawyers and Conveyancers Act) that no further action would be taken.

The application for review

The Applicant was not satisfied with that decision and has applied for a review thereof.


In her application for review, she emphasises that the Respondent had disclosed to her brother the fact that she had sought a Protection Order, and also indicated that she may be in financial difficulties.


She considers this to be unprofessional and a breach of confidentiality. She also queries how the Committee came to the view that it was highly unlikely that the Applicant's brother did not know of the general nature of the Respondent's instructions.


With regard to the Respondent's costs, she advises that she had been advised that the initial estimate of $1,500 was a standard fee for obtaining a Protection Order, and that without details of the Respondent's time records she is unable to provide evidence of what she considers to be overcharging.

The review

The Standards Committee identified the elements of the Applicant's complaint as being:

  • …Breach of confidentiality.

  • …Overcharging.

  • …Poor service


In addition to these matters, I consider that the circumstances surrounding the giving and exceeding of the estimate should be addressed as a separate element of the complaint.

Breach of confidentiality

Rule 8 of the Lawyers and Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008 (Client Care Rules) provides that “a lawyer has a duty to protect and to hold in strict confidence all information concerning a client, the retainer, and the client's business and affairs acquired in the course of the professional relationship”.


In addition, a lawyer has a fiduciary duty towards his client the features of which “include an imbalance of power, the vulnerability of one party, a relationship of trust and confidence, and an assumption by one party of a duty to act in the other's interests”. ( Ethics, Professional Responsibility and the Lawyer, 2nd Edition, Duncan Webb, para 5.3.2). This duty remains whether or not a lawyer's bills are unpaid.


I have set out above the content of the email sent by the Respondent to the Applicant's brother in full. The purpose of the email was to enlist the...

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