Sisson v Canterbury District Law Society

JurisdictionNew Zealand
JudgeHarrison J
Judgment Date09 March 2011
Neutral Citation[2011] NZCA 55
Docket NumberCA464/2009
CourtCourt of Appeal
Date09 March 2011
Between
Therese Anne Sisson
Appellant
and
Canterbury District Law Society
First Respondent

and

The Canterbury Law Practitioners Disciplinary Tribunal
Second Respondent

[2011] NZCA 55

Court:

O'Regan P, Randerson and Harrison JJ

CA464/2009

IN THE COURT OF APPEAL OF NEW ZEALAND

Appeal against a decision of High Court declining appellant's application for judicial review of a decision of Canterbury Law Practitioners Disciplinary Tribunal — professional misconduct for failing to honour a written undertaking — censured and prohibited from carrying out certain conveyancing work — appellant suing a partner in Tribunal member's firm — whether Tribunal member biased — whether appellant waived her right to object to Tribunal member's presence — whether Tribunal had jurisdiction to make findings on issues of law and fact on a solicitor's conduct where those issues were in dispute.

Counsel:

Appellant in person

P M James for Respondents

A The appeal is dismissed.

B The appellant is to pay the first respondent's costs on a Band A basis together with usual disbursements.

JUDGMENT OF THE COURT

REASONS OF THE COURT

(Given by Harrison J)

Introduction
1

The appellant, Ms Therese Sisson, is a lawyer practising in Christchurch. The first respondent, the Canterbury District Law Society (the Society), charged her with professional misconduct for failing to honour a written undertaking. The second respondent, the Canterbury Law Practitioners Disciplinary Tribunal (the Tribunal), found her guilty of the charge. She was censured, prohibited from carrying out certain conveyancing work and ordered to pay costs.

2

Ms Sisson has challenged the Tribunal's decision on two alternative fronts. She applied to the High Court for judicial review given that the Tribunal had exercised a statutory power of decision. 1 French J dismissed her application. 2 Ms Sisson now appeals against that judgment. Separately, she has appealed against the Tribunal's decision to the New Zealand Law Practitioners Disciplinary Tribunal. 3 By agreement, that appeal has been stayed pending determination of the High Court proceeding.

3

Ms Sisson's statement of claim pleads five reviewable errors. French J considered and rejected them all. Ms Sisson's notice of appeal maintained the same five grounds. However, before us she limited her appeal to two grounds – principally, apparent bias by one of the Tribunal members and, secondarily, a lack of jurisdiction to determine the charge. The remaining grounds were plainly not amenable to judicial review in any event.

Background
4

Ms Sisson acted for a Ms Shelly Travis on an agreement to purchase a leasehold interest in a property in Christchurch. The underlying freehold title was part of a larger block comprising a number of titles owned by an incorporated society. These other properties were leased to its members.

5

Ms Sisson discovered that the incorporated society was to be wound up. On that event the lessees were to surrender their leases and obtain freehold titles. So Ms Travis was effectively agreeing to purchase a leasehold interest in the expectation of obtaining a freehold title. Her agreement was due for settlement in June 2005. However, Ms Sisson was advised that the application to the High Court to wind up the incorporated society had been delayed past June due to unresolved litigation. Ms Travis' acquisition of the freehold was thus of a contingent nature.

6

The Southland Building Society (SBS) granted Ms Travis a loan for part of the purchase price (around $20,000 of a total consideration of $148,000). In accordance with standard lending practice the SBS required security by way of a mortgage.

7

What happened in exchanges between Ms Sisson and the relevant SBS employee was the subject of a factual contest before the Tribunal. Ms Sisson wrote to the SBS advising that a freehold title was available but because of litigation in the High Court that title was not then being transferred. The SBS employee was confused by this advice and phoned Ms Sisson. His evidence, which the Tribunal accepted, was that Ms Sisson orally advised him that Ms Travis would nevertheless be in a position to give the SBS a mortgage over the property on settlement in late June. The Tribunal accepted that the SBS understood that the mortgage was to be granted over a freehold, not the leasehold, title and rejected Ms Sisson's evidence to the contrary.

8

The SBS then forwarded Ms Sisson a loan facility agreement and a standard mortgage document with a letter requesting her to act for the lender in preparing and registering a first mortgage over the freehold title. Additionally, the letter advised that the SBS would rely upon Ms Sisson to protect its interests at all times so that it obtained the requisite security. Ms Sisson prepared the mortgage documents and arranged for execution by Ms Travis. She sent a fax to the SBS confirming execution.

9

On 27 June Ms Sisson signed and forwarded the standard SBS solicitor's certificate and undertaking that she was in a position to:

… and shall immediately (on receipt of the loan money if applicable) register the mortgage with the ranking as specified in your instructions so that the society should obtain priority of security required by it.

10

On receipt of Ms Sisson's undertaking, the SBS advanced $19,800 to her trust account. Shortly afterwards she disbursed the funds to Ms Travis. Ms Sisson accepted that when giving her certificate and undertaking she knew that the freehold title remained in the name of the incorporated society and that she would not be in a position to register the security immediately on receipt of the loan funds. In fact, the litigation relating to the incorporated society's winding up occupied a further two years including an appeal to this Court; title was not registered in Ms Travis' name until 1 November 2007. In the meantime, the SBS complained to the Society following Ms Sisson's repeated failures to reply to its enquiries into the whereabouts of its copies of the security documents.

11

Ms Sisson represented herself at the hearing before the Tribunal on 15 July 2008. Her principal defence was that her undertaking was subject to or qualified by an oral understanding that she would only register a first mortgage security when the freehold title became available even though the SBS had advanced funds in the interim. The Tribunal unanimously rejected that defence, held the charge proved and imposed its penalty at the end of the hearing. The Tribunal's reasons were set out in a formal decision delivered on 20 August 2008.

12

We shall now address each of Ms Sisson's two grounds of appeal, which we describe as predetermination and jurisdiction.

Predetermination
Apparent bias
(i) Ms Sisson's case
13

Ms Sisson alleged that the Tribunal's decision was vitiated because one of its six members had a personal interest in the result. She was referring to Mr Brent Stanaway. He is and was the Crown Solicitor in Christchurch and a partner in Raymond Donnelly. Ms Sisson's allegation arises from Raymond Donnelly's representation of the Inland Revenue Department (the IRD) in long-running litigation with Chesterfields Preschools Ltd and its associated entities (the Chesterfields interests). Mr Stanaway was not himself involved as counsel. His partner, Mr Phillip Shamy, was responsible for conducting the IRD's case.

14

The Chesterfields interests comprise Chesterfields Preschools Ltd; David John Hampton (personally); Chesterfields Partnership; Chesterfields Preschools Partnership; and Anolbe Enterprises Ltd. Ms Sisson failed before us to identify the nature and extent of her interest in these entities. We accept, however, that Ms Sisson and Mr Hampton, her former husband, were sometime partners in both the Chesterfields and Chesterfields Preschools Partnerships. 4 The partnerships represent Ms Sisson's only possible personal interest in the relevant litigation.

15

The Chesterfields interests issued judicial review proceedings against the IRD in 2006. In broad terms, they claimed that the IRD had failed to adhere to concessionary arrangements made with them as taxpayers. 5 Both the initial judicial review application 6 and a second 7 were upheld at first instance. However, the IRD was partially successful in a consolidated appeal against the second decision and decisions in other related proceedings. 8

16

At the time of the judicial review proceedings the IRD had assessed tax owed by the Chesterfields Partnership and the Chesterfields Preschool Partnership at $1.2 million and $240,000 respectively. As a partner in both entities, Ms Sisson was potentially personally liable to this extent. She was in that sense also interested in the various proceedings involving the Chesterfields partnerships.

17

In May 2008 the five Chesterfields interests (see at [14] above) issued in the High Court at Christchurch a separate proceeding alleging misfeasance against the

IRD and a range of individuals. The statement of claim is a discursive document running to over 300 paragraphs. Its essence seems to be an allegation that IRD employees deliberately failed to disclose file notes which were relevant in the previous litigation with the Chesterfields interests. Mr Shamy, as counsel for the IRD, was said to be a party to this alleged wrongdoing and was cited as the 19th defendant. Substantial damages were sought for the tort of misfeasance in public office. There is no evidence about the fate of the proceeding
18

The IRD file notes were before the Court in the first judicial review proceeding. Accordingly, Fogarty J was able to make factual findings as to the existence or otherwise of the arrangements asserted by the Chesterfields interests. The Judge concluded that, while the IRD had never unequivocally entered into a binding arrangement, its correspondence and conduct was capable of leaving Mr Hampton with the...

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