RH v LV
| Jurisdiction | New Zealand |
| Judgment Date | 25 September 2012 |
| Neutral Citation | [2012] NZLCRO 87 |
| Date | 25 September 2012 |
| Docket Number | LCRO 189/2011 |
| 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 Canterbury-Westland Standards Committee 1
[2012] NZLCRO 87
LCRO 189/2011
Application for review pursuant to s193 Lawyers and Conveyancers Act 2006 (right of review) from a Standards Committee determination which found the practitioner guilty of unsatisfactory conduct by virtue of conduct unbecoming — practitioner acted for a client without an instructing solicitor in breach of intervention rule — complainant had been a client for over 25 years — allegation by practitioner that member of Standards Committee should have recused himself on grounds of bias — history of conflict between partner's of Standards Commitee member's firm and practitioner — test for bias under Saxmere Company Ltd v Wool Board Disestablishment Company Ltd.
RH as the Applicant
LV as the Respondent
LU as Representative of the Respondent
Canterbury-Westland Standards Committee 1
The New Zealand Law Society
DECISION
Just days before Christmas in 2007 the Practitioner, Mr RH, was approached by Mr LV (the Applicant) and asked for assistance in matters connected with the unexpected death of his wife. The Applicant had been a long standing client of the Practitioner (about 25 years) in his general law practice. At the time in issue the Practitioner had been some months in practice as a barrister.
The Practitioner had quoted a fee of $3,000 but ended up charging the Complainant $3,900 which he paid. However, his dissatisfaction with the added charge was raised when the Applicant instructed a new lawyer (Mr S) some two years later. Mr S advised the Applicant that a costs complaint was out of time, but he assisted the Applicant to formulate other complaints against the Practitioner (Mr RH) to the New Zealand Law Society.
The complaints received by the Complaints Service included allegations that the Practitioner had no instructing solicitor when he provided services to the Applicant, and with reference to a draft Statement of Claim found on the file, that the Practitioner had in effect “made a meal” of rather “sparse facts” for which the Applicant had been charged, and which “clearly accounted for much of the fees.”
Since these events preceded the Lawyers and Conveyancers Act 2006, the Standards Committee was required to consider whether the conduct reached the threshold of section 351. The Committee found the Practitioner guilty of unsatisfactory conduct by virtue of conduct unbecoming, having concluded that the Practitioner had chosen to ignore the non-intervention rule in taking instructions directly from a client and not having an instructing solicitor.
The Standards Committee also made an adverse comment about the Practitioner in relation to certain steps he had taken for the Complainant which were described as “ill conceived”, although no adverse finding was made in relation to that.
The Practitioner sought a review of that decision. A review hearing was held, attended by the Practitioner, and also by the Applicant and his counsel Mr S.
Prior to commencing practice as a barrister (some months prior to the above events) the Practitioner had practiced as a solicitor. The Applicant had been a client of the Practitioner for about 25 years.
The Practitioner sold his practice to law firm R (which was located nearby) and transferred to that firm all files of consenting clients (which included the Applicant's file). The transfer of his business involved a cross referral arrangement whereby the Practitioner would not go into competition with that firm in relation to general matters, and the firm would brief him in terms of its litigation requirements.
Just before Christmas 2007 the Applicant's wife committed suicide. The Applicant had concerns and questions about the circumstances of the death, and whether unlawful conduct may have been involved. In mid January he contacted the Practitioner for legal advice in relation to several concerns, including his concerns about whether there had been any criminal wrongdoing. The information provided by the Applicant led the Practitioner to make some preliminary enquiries, which included contacting the police who appeared not to have taken any investigatory steps.
The Practitioner also addressed several other issues raised by the Applicant, and sought a legal opinion (from another lawyer who had experience in those areas) about the Applicant's possible ACC entitlements, employment law matters, and whether a claim was available against the wife's employer. Among steps taken, the Practitioner had started working on a Statement of Claim.
By mid March 2007 the Applicant decided that he did not wish to pursue matters any further, terminated the retainer, and settled up the bill after some protest that it was higher than had been quoted. His dissatisfaction about this was raised with another solicitor some two years later, and led to the complaints referred to above.
The Committee's decision described the complaint as alleging that the Practitioner had advised the Applicant to take legal proceedings when there was no evidence to support such proceedings, and at a time when the Applicant was vulnerable, and there being no instructing solicitor.
There were two parts to the Committee's decision.
The first dealt with the steps taken by the Practitioner, the Committee being particularly concerned about the proceeding. The Committee opined that such an action was misconceived as it was far too early to contemplate any sort of legal action as the facts were not yet known. However, the Committee concluded ‘by a narrow margin’ that the conduct did not reach the threshold required for misconduct or conduct unbecoming, and made no adverse finding in relation to this part of the complaint.
The second part of the Committee's decision dealt with the failure of the Practitioner to have had an instructing solicitor. The Committee was not impressed by the various explanations offered by the Practitioner for not having arranged an instructing solicitor, and found the Practitioner's responses entirely unconvincing. The Committee considered that this conduct reached the section 351 jurisdictional threshold. At paragraph 7, the Committee wrote:
The Committee finds that [the Practitioner] is guilty of conduct unbecoming in that although being aware of the requirements of the intervention rule and that the rule clearly applied to him, [the Practitioner] chose to ignore the rule and take instructions directly from a client. Despite not being entitled to act, [the Practitioner] embarked on an ill-conceived adventure of the kind against which the intervention rule is designed to protect.
The Committee considered that the failure reached the section 351 threshold, and there followed a finding that the Practitioner was guilty of unsatisfactory conduct.
The two main grounds for the Practitioner's review application were (a) that the Standards Committee failed to correctly apply the threshold test in this case (he denied any wrongdoing in relation to the extent or quality of his services to the Applicant), and (b) that the Committee may have been biased in its decision (providing information to support this submission).
At the review hearing there was a lengthy discussion about the circumstances leading to the Applicant seeking the assistance of the Practitioner, and about the background to the steps taken by the Practitioner in relation to the Statement of Claim.
The Practitioner admitted that during the time of providing services he took no steps to seek formal instruction from a solicitor. At the time that the Applicant contacted him, the Practitioner said that he had explained his new role (as barrister) to the Applicant (the Applicant confirmed that he knew the Practitioner was “lawyering in a different way”), but agreed that the significance of this may not have been fully understood by the Applicant. He described the emotional state of the Applicant at the time, and that in light of their long standing professional relationship he was not surprised that the Applicant had turned to him for help.
The Practitioner's view was that the Standards Committee took the most negative view possible of the matter. He submitted that the conduct was incapable of reaching the threshold required by section 351 of the Lawyers and Conveyancers Act. He questioned the impartiality of the Committee, and in particular raised an allegation of bias against one of the Committee Members.
The conduct complained of occurred prior to 1 August 2008. Section 351 of the Lawyers and Conveyancers Act 2006 provides that a Standards Committee does not have jurisdiction to consider complaints about conduct that occurred prior to the commencement of this Act, unless the conduct complained of could have led to disciplinary proceedings being taken against the Practitioner under the former Law Practitioners Act. Once the threshold of s 351 is met the Committee may then turn to consider whether a determination against the practitioner ought to be made.
The pre 1 August 2008 standards are found in ss 106 and 112 of the Law Practitioners Act 1982. The threshold for disciplinary intervention under the Law Practitioners Act 1982 was relatively high and may include findings of misconduct or conduct unbecoming. Misconduct was generally considered to be conduct:
…of sufficient gravity to be termed ‘reprehensible’ (or ‘inexcusable’, ‘disgraceful’ or ‘deplorable’ or ‘dishonourable’) or if the default can be said to arise from negligence such negligence must be either reprehensible or be of such a degree or so frequent as to reflect on his...
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