[2012] NZLCRO 87

LCRO 189/2011

Concerning An application for review pursuant to Section 193 of the Lawyers and Conveyancers Act 2006


Concerning a determination of the Canterbury-Westland Standards Committee 1


RH as the Applicant

LV as the Respondent

LU as Representative of the Respondent

Canterbury-Westland Standards Committee 1

The New Zealand Law Society

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.

Held: The Committee had made certain assumptions about RH's conduct. The first assumption was that the steps taken had been ill-conceived. While the possibility of a proceeding had undoubtedly been discussed, there was nothing to indicate that the claim would have been filed unless there was sufficient evidential basis. In those circumstances, the soundness of the implied assumption that the presence of an instructing solicitor would have led RH to take a different pathway was doubtful.

The second assumption made by the Committee was that RH's failure to arrange for an instructing solicitor had been deliberate. RH had been unable to provide any explanation for the failure. It was doubtful that RH's failure to arrange for an instructing solicitor had been a calculated act. The initial contact by LV had been a short time after his wife's death. RH had acted for LV for some 25 years and it could not have been unexpected that in such circumstances LV would turn to RH for advice. Some of the steps then taken by RH were required to be taken expeditiously (e.g. preserving evidence). Law firms were then closed over summer. The fact that RH had assisted a former client in those circumstances, without arranging an instructing solicitor, did not reach the threshold required by s351 LCA.

The disciplinary enquiry should have focused on RH's failure to have arranged for an instructing solicitor after the initial contact, when law firms were again operational. The existence of the statement of claim was not, alone, a sufficient basis for assuming that the proceeding would have been filed without there being a sound basis for such action. Nor was there any sound basis for an assumption that different steps would have been taken by RH if there had been an instructing solicitor. The Committee's decision rested on a number of assumptions, which were not well supported. There was no sufficient basis for concluding that RH had chosen to ignore the intervention rule.

The test for bias under Saxmere Company Ltd v Wool Board Disestablishment Company Ltd involved whether a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial mind to the resolution of the question the judge was required to decide. Saxmere required identification of what might lead a judge to decide a case other than on its legal and factual merits and an articulation of the logical connection between the matter and the feared deviation from the course of deciding the case on its merits. The member had admitted the conflict. The circumstances for recusal had been clear enough, and the member should have recused himself.

There was no suggestion that other members of the Committee had been aware of the background history between RH and the member. The finding that the member should have recused himself was not a finding that the Committee's decision had been tainted by bias. The Committee's conclusion was likely to have been influenced by what was perceived as evasive answers from RH to explain the failure to observe the intervention rule.

There was no point in redirecting a committee to undertake further investigation when the available evidence did not support, and was unlikely to support, a degree of wrongdoing that would be sufficient to satisfy the threshold test of s351 LCA .

Pursuant to s211(1)(a) LCA (powers exercisable on review) the Committee's decision was reversed.



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 Standards Committee decision

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...

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