Wellington Standards Committee v Guy William David Manktelow

JurisdictionNew Zealand
JudgeD F Clarkson,Mr W Chapman,Mr J Clarke,Mr P Radich,Ms P Walker
Judgment Date09 October 2012
Neutral Citation[2012] NZLCDT 30
Docket NumberLCDT 011/12
CourtLawyers and Conveyancers’ Disciplinary Tribunal
Date09 October 2012

In the Matter of the Lawyers and Conveyancers Act 2006

BETWEEN
Wellington Standards Committee
Applicant
and
Guy William David Manktelow
of Wellington, Lawyer

[2012] NZLCDT 30

CHAIR

Judge D F Clarkson

MEMBERS OF TRIBUNAL

Mr W Chapman

Mr J Clarke

Mr P Radich

Ms P Walker

LCDT 011/12

NEW ZEALAND LAWYERS AND CONVEYANCERS DISCIPLINARY TRIBUNAL

Penalty decision following admission of a charge of professional misconduct as defined in s7 Lawyers and Conveyancers Act 2006 (misconduct defined in relation to lawyer and incorporated law firm) — practitioner admitted that he had allowed firm's trust account to be overdrawn on numerous occasions and gave false certificates to New Zealand Law Society — occurred over period of two years — no client had suffered loss — there was no suggestion the practitioner's professional work for clients was not up to standard — appropriate penalty — whether practitioner fit to practice or should be struck off Roll of Barristers and Solicitors of the High Court.

APPEARANCES

Mr K Johnston for the Law Society

Mr I Millard QC for the Practitioner

DECISION OF THE NEW ZEALAND

Introduction
1

The Practitioner, Guy William David Manktelow, has admitted one charge of professional misconduct, as described in the seven supporting particulars to the charge. The charge and particulars are annexed as Appendix 1.

2

The matter proceeded as a penalty hearing during which the practitioner answered questions from the Tribunal, but was in other respects a submissions only hearing. At the conclusion of the hearing the Tribunal suspended the practitioner for 12 months commencing 23 October, censured him and imposed costs orders. We reserved the reasons for our decision. This judgment contains those reasons.

Background
3

The Practitioner Guy William David Manktelow is aged 51 and married with one child aged 11 years. He was admitted as a Barrister and Solicitor of the High Court in New Zealand in 1984 and has practised as such ever since. From 1993 he has practised on his own account. Since 1997 he has been in partnership with his brother Toby George Amos Manktelow. The Practitioner's practice was in Lower Hutt. His brother's practice in the same partnership was in Palmerston North. The two practices were small practices with that of the Practitioner being made up of himself and one longstanding staff member who gave general support. Each of the practices in Lower Hutt and Palmerston North concentrated on civil litigation, often estate type litigation.

4

The practice maintained a Trust Account where at any one time the volume of client funds was relatively small. The Trust Account was operated using a manual handwritten system and this system was operated by the Practitioner. It was he who was responsible for the observance of correct practices in relation to the Trust Account and for the giving of accurate and truthful reports to the New Zealand Law Society (“the Society”) concerning the Trust Account.

The Charges
5

On 15 June 2012 the Practitioner was charged with misconduct pursuant to s 7(1)(a) and (b) of the Lawyers and Conveyances Act 2006 (“the Act”). The essence of the charges was that on numerous occasions the Practitioner allowed the firm's Trust Account to be overdrawn and that on many occasions he gave false certificates to the New Zealand Law Society as to the state of the firm's Trust Account. This occurred for a period of almost two years.

6

The Practitioner readily and promptly admitted all of the charges.

The Trust Account
7

A solicitor's Trust Account is an account in which clients funds are accumulated and held in trust. Careful records need to be kept showing the individual entitlements of clients to funds within the account. Subject to correct procedures being followed, a lawyer is entitled to take his or her fee remuneration or to recover disbursements from client monies held in trust. Those entitlements of the practitioner are assembled in a Costs Account within the Trust Account. Monies can then be taken by the practitioner from the Costs Account for the purpose of meeting the needs of the firm and the needs of the practitioner. In the case of the Practitioner the breach in relation to the overdrawing of the Trust Account was explained in a report by the Society's inspector as follows:

The overdrawn account occurred as fees in excess of the amount deducted from the clients had been transferred to the practice bank account. The effect of the overdrawn Costs Account is that there is insufficient funds in the Trust Account to meet client credit balances.

8

The Society has a system for the supervision of Trust Accounts which relies heavily on the honesty and accuracy of practitioners in relation to their Trust Accounts. Monthly certificates are required to be given to the Society advising whether or not the practitioner's Trust Account has been managed in accordance with the Rules. The Practitioner gave monthly certificates saying that all was in order when in fact it was not.

9

As a further part of the supervision system of the Society, inspectors appointed by the Society visit law firms from time to time and examine their Trust Account practices. On previous occasions from 2007 onwards inspections of the Practitioner's Trust Account had shown that the Trust Account was not being managed properly and these deficiencies were drawn to the attention of the Practitioner orally and in writing. Further visits by the inspector to the practice between 29 February and 6 March 2012 revealed that the practice of overdrawing the Trust Account was continuing and as a result of those visits the charge which is now before us was laid.

10

What has happened is that the Practitioner has taken for the purposes of his firm or himself more money from clients than the costs that he had rendered at that point allowed. The maximum amount overdrawn in the period to which the charge relates was $33,136.02.

11

In this “borrowing” from the Trust Account, clients do not suffer any actual loss unless the monies are not “repaid”. The risk to the clients is that if at any point in time all clients wanted the money out of the Trust Account to which they were entitled there would be a deficit to the extent of the overdrawing by the practitioner.

12

There can be no hiding from the fact that what happened here is that the Practitioner used clients' money which he was not entitled to use. No client has suffered any loss and it appears unlikely that any loss would have been suffered. That however does not diminish the seriousness of what happened. The seriousness of what happened is that the Practitioner crossed a line which no practitioner should ever cross and used clients' money without authority and to meet the pressing needs of the practice. Moreover, the Practitioner then gave false certificates to the Society in which the Society was assured that everything in relation to the Trust Account was in order.

Our Assessment of the Practitioner
13

The Practitioner appears to be a person who, somehow, came to be conducting his practice according to two different sets of standards. In his professional work he appears to have been capable and diligent. He appears to have been supportive of clients who needed support and generous and considerate in the sense of working professionally for long periods when clients who could not afford to meet his fees were unable to do so until some result from the litigation which was being conducted eventuated. He was prepared to do work for clients on legal aid when many practitioners are unwilling to do this on account of the administrative demands and the lesser returns that come from such work. There has been no suggestion before us that in his professional work for clients the practitioner was anything other than a dutiful and capable lawyer. We were told that, in Lower Hutt, a capable lawyer willing to do legal aid work was a rarity.

14

Then, on the other hand, we have the picture of the Practitioner neglecting the financial management of his practice. His Trust Account administration which he did himself appears to have been done reluctantly and under pressure. The consideration for clients and the support of clients who could not immediately pay for services had the consequence of inadequate cash flow within the practice. And this then had the consequence where the Practitioner “borrowed” clients' monies by overdrawing the Trust Account to meet immediate needs. The Practitioner then seemed to have been able to persuade himself to complete the Trust Account certificates to the Society in a way that showed everything to be...

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1 cases
  • Otago Standards Committee v Greg Roderick Stewart
    • New Zealand
    • Lawyers and Conveyancers’ Disciplinary Tribunal
    • 15 Septiembre 2016
    ...were not made available to us. 4 Paragraph [7], affidavit of D A Webb dated 12 May 2016. 5 Wellington Standards Committee v Manktelow [2012] NZLCDT 30, Auckland Standards Committee No. 5 v Patel [2014] NZLCDT 67, Wellington Standards Committee No. 2 v Jones [2014] NZLCDT 52, Auckland Stand......

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