RF v CN
| Jurisdiction | New Zealand |
| Judgment Date | 03 November 2016 |
| Neutral Citation | [2016] NZLCRO 61 |
| Date | 03 November 2016 |
| Docket Number | LCRO 254/2012 |
| Court | Legal 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 [Area] Standards Committee
[2016] NZLCRO 61
LCRO 254/2012
Review of complaint that the fees charged by a practitioner, particularly those that related to work done in cancelling the retainer were excessive and that the practitioner had failed to advise the complainant of a request from the opposing counsel for more information — the complainant said that the failure to pass on this request resulted in the litigation not being settled at an early stage — whether the practitioner breached her professional obligations by failing to inform the complainant of the request for further information — whether the practitioner was entitled to charge for work undertaken to cancel the retainer — whether the fees charged were fair and reasonable — whether the practitioner breached s161 Lawyers and Conveyancers Act 2006 (Stay of proceedings for recovery of costs) by continuing recovery proceedings for costs awarded by the District Court before the complaint had been finally disposed of — whether an invoice rendered by the practitioner after delivery of the Standards Committee decision should be considered on review.
Mr RF as the Applicant
Ms CN as the Respondent
[Area] Standards Committee
The New Zealand Law Society
DECISION
Mr RF has applied for a review of the decision of [Area] Standards Committee to take no further action in respect of his complaint concerning the conduct of Ms CN.
At commencement, I must acknowledge that there has been considerable delay in this review being progressed to resolution. I apologise to the parties for that regrettable delay.
Mr RF engaged Ms CN to act for him in 2010 in relation to a District Court civil claim he wished to file concerning an agreement for sale and purchase relating to a leaky home. Ms CN is a sole practitioner practising as Law Firm 1.
On receiving instructions Ms CN sent Mr RF a copy of Law Firm 1's standard terms and conditions. They did not specify Law Firm 1's hourly rates but referred to the factors in rule 9 of the Lawyers and Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008. The terms and conditions also provided, among other things, that:
-
(a) Terms of payment were within seven days from the date the bill was rendered unless alternative business arrangements had been made.
-
(b) If the fees were not paid by the due date default interest would be charged at 15 per cent per annum.
-
(c) The client would be liable for legal and debt collection costs incurred, including solicitor/client costs, in enforcing, or attempting to enforce, their rights.
Included in the information capsule filed with the District Court in support of Mr RF claim was a statement from a Mr and Mrs DS, the neighbours of the property at the centre of the dispute. Mr DS's evidence was that he spoke to a real estate agent at an open home about the property being a leaky home. Mr RF considers this was to be the key evidence in support of his claim against the real estate agency.
On [Date] Mr QW, the lawyer for the real estate agency, emailed Ms CN asking her to obtain instructions from Mr DS as to whether he could identify the agent with whom he says he discussed the property.
Mr RF was never advised that this request had been made. There is no evidence that Ms CN contacted Mr DS, nor is there any evidence of her having replied to Mr QW.
Mr RF had difficulty in paying the legal fees charged. On [Date] he entered into a deed of acknowledgement of debt in relation to $11,935.60 fees and interest then outstanding. A payment plan was agreed but Mr RF did not make the payments agreed.
Mr RF decided to change lawyers. He instructed Mr BL of Law Firm 2 to act for him. On [Date] Mr BL advised Ms CN he had received instructions and requested Ms CN to forward him Mr RF's file.
On [Date] Law Firm 1 replied to Law Firm 2 and advised it had a lien over Mr RF's files and stated they would be provided on receipt of an undertaking by Law Firm 2 pursuant to rule 4.4.2 of the Conduct and Client Care Rules. Law Firm 2 did not provide the undertaking. The files were not provided.
Ms CN applied to the District Court for leave to be removed as solicitor on the record. She also commenced recovery action for her outstanding fees.
In a judgment dated [Date] [Judge] determined that Ms CN was entitled to rely on the solicitor's lien and any other property rights she had over the file pursuant to arrangements made between her firm and Mr RF.
In the same judgment, Ms CN was awarded costs on her application for leave to withdraw, including her attendance at the settlement conference on [Date]. Costs were awarded on a category 2 band B basis and totalled $975.
Ms CN then commenced separate enforcement action against Mr RF for the court costs awarded. She forwarded an account to Mr RF for the work done on the application for leave to withdraw and associated documents, her costs calculated on a time and attendance basis.
In [Date] Mr RF filed his complaint with the Law Society. On receipt of the complaint Ms CN stepped back from pursuing recovery of her outstanding fees but continued to pursue payment of the costs awarded by the District Court.
The Standards Committee decision was released on [Date]. On [Date] Ms CN contracted Company 1 to assist with the collection of outstanding fees.
These invoices included an invoice for $6,457.37 which was rendered after Ms CN ceased acting for Mr RF. That invoice covered time spent in seeking enforcement of the fees owing and the costs award and also Ms CN's time in filing submissions and dealing with communications in relation to Mr RF' complaint to the Law Society.
Mr RF made complaint that:
-
(a) The fees charged by Ms CN were excessive.
-
(b) Ms CN refused to provide his files when requested.
-
(c) Ms CN was unjustified in claiming a solicitor's lien over Mr RF' files and in declining to provide them to Mr BL until her fees were paid.
In correspondence to the Complaints Service dated [Date], Mr RF expanded further on his grounds of complaint. He submitted that:
-
(a) Ms CN had failed to respond to requests from opposing counsel to clarify the identity of a witness who was able to provide material evidence for his claim.
-
(b) Ms CN had failed to advise him of the request that had been made, which had resulted in prejudice to his case.
-
(c) He had been served with court proceedings issued by Ms CN immediately after leaving the settlement conference on [Date].
-
(d) Ms CN had been asked to clarify concerns regarding her accounts but had failed to do so.
The Standards Committee distilled the issues to be considered as follows:
-
(a) Were the costs charged by Ms CN fair and reasonable?
-
(b) Did Ms CN withhold information from Mr RF and his new solicitor, Mr BL?
-
(c) Was Ms CN justified in claiming a solicitor's lien over Mr RF' files and declining to provide them to Mr BL until her fees were paid?
In its decision delivered on [Date], the Committee determined, pursuant to s 138(2) of the Lawyers and Conveyancers Act 2006 (the Act) to take no further action on the complaint.
In reaching that decision, the Committee concluded that the costs charged by Ms CN appeared to be fair and reasonable and that she had kept Mr RF advised as the matter progressed. The Standards Committee also considered that Ms CN was entitled to claim a solicitor's lien over Mr RF's file noting that the District Court had determined that to be the case.
The Standards Committee did not make a specific finding in relation to Mr RF's complaint that Ms CN failed to keep him informed by failing to provide key information. It noted that the details of this part of the complaint were not particularly clear. Nor did the Committee directly address complaint that Ms CN had breached her professional obligations, by arranging for proceedings to be served on Mr RF within the court precinct.
Mr RF filed an application for review on [Date]. He seeks a review on all aspects of the Standards Committee decision other than the complaint in relation to Ms CN claiming a lien over the file. Mr RF also seeks a reduction in fees and a reimbursement of fees paid.
Mr RF also requests that the Legal Complaints Review Officer (LCRO) consider the invoice rendered after the Standards Committee decision when considering his costs complaint. He also seeks a finding that Ms CN is in breach of s 161 of the Act as she recommenced proceedings for the recovery of a disputed bill before the complaint had finally been disposed of.
Mr RF submits that:
-
(a) Ms CN withheld key information from him by failing to inform him of Mr QW's request that his key witness provide information as to whether he could identify the real estate agent he had spoken to. Mr RF submits that this was a critical part of his case and if he had known about this earlier he would have been more prepared for the settlement conference and the case most likely would have settled.
-
(b) Ms CN significantly overcharged him by doing work that was not necessary. For example Mr RF submits that significant charges were incurred in endeavouring to identify and serve a respondent whose contact details were clearly contained in the tenancy agreement which had been provided to Ms CN. He considers he should be reimbursed for all fees incurred after Ms CN failed to inform him of the request by Mr QW to identify the real estate agent, as work completed after this point was unnecessary.
-
(c) Ms CN breached rule 6 of the Conduct Rules when she...
To continue reading
Request your trial