SL v GB
| Jurisdiction | New Zealand |
| Judgment Date | 29 January 2021 |
| Neutral Citation | [2021] NZLCRO 11 |
| Date | 29 January 2021 |
| Docket Number | Ref: LCRO 181/2019 |
| 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] Lawyers Standards Committee
[2021] NZLCRO 11
Ref: LCRO 181/2019
LEGAL COMPLAINTS REVIEW OFFICER
ĀPIHA AROTAKE AMUAMU Ā-TURE
Law Practitioners — application for a review of a decision by an Area Lawyers Standards Committee to take no further action in respect of her complaint concerning the conduct of the respondent barrister who acted for the plaintiff in a dispute concerning the sale of a property — the respondent withdrew as counsel on the grounds his fees were not being paid — obligations when receiving unclear client instructions — duty to complete a retainer — whether the respondent had good cause to withdraw as counsel — Lawyers and Conveyancers Act 2006 — Lawyers and Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008
In accordance with s 213 of the Lawyers and Conveyancers Act 2006 copies of this decision are to be provided to:
Ms SL, as the Applicant
Mr GB, as the Respondent
[Area] Lawyers Standards Committee
New Zealand Law Society
The names and identifying details of the parties in this decision have been changed.
Ms SL has applied for a review of a decision by the [Area] Lawyers Standards Committee (the Committee) to take no further action in respect of her complaint concerning the conduct of Mr GB, a barrister sole, who, at the relevant time, acted for Ms SL, her sister Ms CS SL, and [F] Holdings Ltd ([FHL]), on a dispute with the vendors of a residential property purchased by [FHL]. 1
Ms SL's application for review, her third from the Committee's decisions arising from her complaint about Mr GB's conduct, concerns allegations not addressed by the Committee in its first two decisions, but at my direction considered by the Committee in its third decision.
In November 2014, Ms SL sold the property to the vendors. On or about 6 January 2015, the vendors sold the property to [FHL] for $455,000.
Unable to agree with the vendors on a settlement date which was not specified in the sale agreement, on 12 June 2015 [FHL] lodged a caveat against the title to the property. 2 In early July 2015 the vendors applied to the High Court, first, to have the caveat removed, 3 and secondly, for an injunction restraining [FHL] from onselling the property.
By then Mr DJ, of [Law Office 1] acted for [FHL]. On 10 July 2015, Mr DJ filed a Notice of Opposition to the vendors' proceedings, and engaged Mr GB to assist with [FHL]'s defence. Mr GB sent his letter of engagement to [FHL], Ms SL and Ms CS on 13 July 2015. 4
On 28 September 2015 Mr DJ served a settlement notice on the vendors' lawyer who responded on 6 October 2015 with the vendors' offer to sell the property to [FHL] for $509,000.
Ms SL instructed (by email) Mr GB on 8 October 2015 to make a counteroffer of $469,000. The following day, 9 October 2015, Mr DJ informed the vendors' lawyer that [FHL] rejected the vendors' offer of $509,000 but would pay $455,000 as provided in the sale agreement.
Having heard, on 28 October 2015, the vendors' application to remove [FHL]'s caveat, the High Court delivered its decision on 13 November 2015 in which it sustained the caveat.
As detailed in my later analysis, between 15 January 2016 and 6 April 2016 Mr GB and Ms SL exchanged emails concerning (a) Mr GB's requests for payment of his fees, (b) his attempts to resolve the dispute by negotiation, (c) Ms SL's queries about his fees for the caveat hearing, the ongoing legal costs of the litigation, and how best to proceed; and (d) Ms SL's 8 October 2015 instructions to submit a counteroffer of $469,000.
Mr GB informed (by email) Ms SL, and Ms CS on 7 March 2016 that to “achieve some cost savings” he may “engage a junior barrister to assist” with discovery. On 28 April 2016 he informed them he had engaged Ms PR.
On 3 May 2016 Ms SL asked (by email) Mr GB whether she could “approach” the vendors' lawyers “in an indirect way for an offer before the courts”. The following day, 4 May, Mr GB informed (by email) the vendors' counsel he had been instructed to explore the “possibility of the parties settling this litigation”.
That approach was met without success. On 6 May Ms SL instructed Mr GB to submit a settlement offer of $485,000 which the vendors rejected at the case management conference on 11 May. 5
By Friday, 27 May 2016, Ms PR had completed and filed Ms SL's discovery affidavit. On 30 May Ms PR sent (by email) her first invoice, and report to Mr GB which he forwarded (by email) to Ms SL that day. Ms PR provided her second, 30 June 2016, invoice to Mr GB on 6 July 2016.
From 8 July 2016 until 15 November 2016, the substantive hearing date, Mr GB, whilst continuing to act, unsuccessfully sought payment of his and Ms PR's fees, as well as a retainer to be lodged in Mr DJ's trust account for the hearing costs.
The dispute was settled on 15 November 2016 before the hearing commenced.
Despite further requests, on 28 February 2017, not having received “an acceptable proposal” for payment of his and Ms PR's fees, Mr GB informed (by email) Ms SL, Ms CS and Mr DJ he intended to seek leave to withdraw as counsel when the matter was next to be called in the High Court on [date], and recommended they seek other legal representation.
Ms SL lodged a complaint with the Lawyers Complaints Service on 28 February 2017. 6
Ms SL's allegations, which included Mr GB's failure (a) to submit her 8 October 2015 counteroffer to the vendors' counsel, (b) to advise her about alternatives to litigation, and (c) to include a term in the settlement agreement, were considered by the Committee in one decision. Her complaint about Mr GB's fees was considered in a
The Committee decided Mr GB's fees were fair and reasonable, and determined to take no further action in respect of Ms SL's complaint about Mr GB's fees. I confirmed that decision in my review decision. 7
The Committee did not, in its fees decision, consider Ms SL's complaints that:
-
(a) Ms PR's fees were not fair and reasonable;
-
(b) without Ms SL's permission, Mr GB informed the vendors' lawyer her dispute with the vendors was not worth litigating;
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(c) without first informing Ms SL, Mr GB informed the vendors' lawyer he was no longer acting for her; and
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(d) Mr GB instructed a debt collector, a day before the date by which he had asked for payment of his and Ms PR's outstanding fees.
For that reason, in my review of the Committee's fees decision, pursuant to s 209(1)(a) of the Lawyers and Conveyancers Act 2006 (the Act), I directed the Committee to reconsider and determine those issues.
I refer to Mr GB's response in my later analysis. 8
The Committee delivered its decision on 23 October 2019, and determined, pursuant to s 138(2) of the Act, that any further action on Ms SL's complaint was unnecessary or inappropriate.
The Committee noted that the issues for consideration were those I directed the Committee to reconsider in my review of the Committee's fees decision. 9
The Committee concluded Ms PR's fees were fair and reasonable, and because Ms SL's dispute with the vendors proceeded to a Court hearing, Ms SL was “liable” to meet the related legal fees.
Although acknowledging it had not sought the assistance of an independent cost assessor, the Committee explained “a number of the members” of the Committee possessed “relevant expertise in civil litigation”, including the discovery process which comprised the large part of the legal work carried out by Ms PR.
In arriving at that conclusion, the Committee noted r 9 of Lawyers and Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008 (the Rules) requires that in determining whether a lawyer's fee is “fair and reasonable for the services provided”, regard must be had to “the interests of both client and lawyer”, and “to the factors set out in rule 9.1”.
Those of the fee factors in r 9.1 considered particularly relevant by the Committee were (a) Ms PR's “time and labour expended: r 9.1(a); (b) Ms PR's “skill, specialised knowledge, and responsibility … to perform the services properly: r 9.1(b); “urgency” of the matter: r 9.1(d); and “the complexity of the matter”: r 9.1(f).
The Committee concluded Ms SL had not “made out” Mr GB had not acted on her 3 May 2016 request whether there was “any way” she could “approach the [vendors'] lawyers in an indirect way for an offer before the courts”.
In reaching that decision, the Committee noted Mr GB had on 4 May 2016 forwarded to Ms SL his email sent to the vendors' counsel fifteen minutes earlier to explore “any possibility” of a settlement of the dispute, and Ms SL “had raised no issue with [the] content” of that email.
In deciding to take no further action on this allegation, the Committee noted Mr GB, faced with Ms SL “repeatedly breach[ing] undertakings and assurances” to pay his and Ms PR's outstanding fees, and lodge a retainer with Mr DJ for the hearing costs, had nonetheless continued to act.
The Committee concluded Mr GB had been “more than fair and accommodating” before giving notice on 28 February 2017 of his intention to withdraw as counsel. 10
The Committee did not consider Mr GB, by seeking payment, had “behaved in a malicious way” towards Ms SL.
Rather, (a) Mr GB's conduct “continuing to protect Ms...
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