Auckland Standards Committee 4 v Schlooz [2021] NZHC 2185 (24 August 2021)

Last Updated: 15 September 2021

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2021-404-854 [2021] NZHC 2185

IN THE MATTER OF	an appeal against a decision of the New Zealand Lawyers and Disciplinary Tribunal pursuant to s 253 of the Lawyers and Conveyancers Act 2006
BETWEEN	AUCKLAND STANDARDS COMMITTEE 4 Appellant
AND	JOHN PAUL TIMOTHY SCHLOOZ Respondent

Hearing:	28 July 2021
Counsel:	P N Collins for appellant S R G Judd for respondent
Judgment:	24 August 2021

JUDGMENT OF TOOGOOD J

This judgment was delivered by me on 24 August 2021 at 2.30pm, pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

Solicitors:

New Zealand Law Society, Wellington Wilson McKay, Auckland

AUCKLAND STANDARDS COMMITTEE 4 v SCHLOOZ [2021] NZHC 2185 [24 August 2021]

Introduction

• [1] John Paul Timothy Schlooz is an Auckland lawyer.

• [2] In March 2021, he admitted two charges of misconduct under s 7(1)(a)(i) and

(ii) of the Lawyers and Conveyancers Act 2006 (the LCA) arising from offensive, abusive and threatening communications with a litigant who was representing herself in proceedings against Mr Schlooz’s client.

• [3] On 14 April 2021, the New Zealand Lawyers and Conveyancers Disciplinary Tribunal delivered a decision in which it imposed penalties that included suspending Mr Schlooz from practice for four months from 17 April 2021.¹ As the Tribunal said, the decision concerned the proper disciplinary response when, while providing services that are regulated under the LCA, a lawyer corresponds with another person in an offensive, abusive and threatening manner. It also addresses the importance of the principles of general deterrence and denunciation in a regulatory framework, the purposes of which are to protect the public and maintain the confidence of the public in the legal profession.² Also, the decision considered the extent to which consistency of penalty can be achieved across a range of vastly different types of conduct and contexts in which that conduct has occurred.³

• [4] The Auckland Standards Committee 4, which had laid the charges before the Tribunal, appeals against the period of suspension as being manifestly inadequate.

The facts

• [5] I adopt for the purposes of the appeal the informative summary of the factual background described by the Tribunal in its decision. It is regrettably necessary to repeat the language used in the offending correspondence in order to convey adequately the highly objectionable nature of the language used:

• [10] The complainant, Ms Y, was the estranged wife of Mr Schlooz’s close friend [redacted]. The practitioner had been friendly with the complainant

¹ Auckland Standards Committee 4 v Schlooz [2021] NZLCDT 12 [the Tribunal decision].

² At [3].

³ At [5].

before she had separated from his friend and indeed had acted for her on one occasion.

• [11] The complainant was acting for herself in relation to a number of disputes that she had with her former husband relating to property division, including her attempt to set aside a contracting-out agreement. There was also a tenancy dispute relating to the complainant’s occupancy of a property which was owned by her estranged husband’s trust, of which Mr Schlooz was a trustee. Further, there was a business dispute relating to a contract of services between the complainant and her estranged husband.

• [12] From this it can be seen that the complainant was particularly vulnerable in that all areas of her life (relationship, housing, and employment) were impacted by her separation from, and ongoing dispute with her former husband, Mr Schlooz’s close friend and how closely involved Mr Schlooz was professionally and personally.

• [13] Mr Schlooz was acting for his friend Mr Y in relation to all of these disputes, although he initially denied that he was providing legal services and attempted to argue that he was acting in his personal capacity.

• [14] The disputes generated much correspondence between the complainant and the practitioner, but the subject of these charges are the email exchanges between 15 May 2019 and 17 November 2019 in relation to Charge 1, and those from 1 February 2019 to 10 September 2019, in relation to Charge 3 (which deals with wrongful threats).

• [15] ... It is not necessary to repeat all of these [emails] in the body of the decision, however it is also insufficiently illustrative of the concerns raised by this case to simply describe them in bland terms such as “abusive”, “disrespectful”, or “offensive”. Therefore, we provide some of the worst examples as follows:

• “I’ll put this simply in terms you can understand, FUCK OFF.” (15 May 2019)

• “You really are a moron.” (4 June 2019)

• “Fuck off [redacted]. You’re a sad old drunk who needs help. Don’t flatter yourself that [redacted] is interested in your life. He’s so much happier now that he’s dumped you. I feel sorry for the guys you’re trying to trap into a horrid life with you.” (14 July 2019)

• “... In the land of the witless you would be Queen. You are the reason god gave us a middle finger. We regard you with an indifference that borders on aversion. If we throw a stick, will you leave? People clap when they see you; they clap their hands over their eyes. (17 November 2019)

We are jealous of the people who haven’t met you, now fuck off. Leave [redacted] in peace. He’s much happier now that he doesn’t not (sic) have to put up with your drunken self.” (17 November 2019)

• “Just fuck off you pathetic old bag ...” (17 November 2019)

• [16] Further, Mr Schlooz, at various times, threatened Ms Y with bankruptcy, and the payment of costs.

• [17] The complainant found the exchanges so distressing that she applied to the District Court for an Harassment Order, in September 2019. Following a defended hearing on that application on 15 May 2020, Her Honour Judge Bouchier made an order in the complainant’s favour. The complainant points out that the judgment strongly endorsed her grounds for making the application.

• [18] Importantly, Her Honour went on to make strong comments of condemnation about Mr Schlooz. She said at paragraph [19]:⁴

“... I can only say that from when I first commenced working in the law, late in 1973 and throughout the 32 years I have (sic) on the District Court Bench, I have seen tens of thousands of family violence cases, gang violence cases, harassment applications, and any other type of violence with the associated language used in such incidents, and I say that I have never seen such an exhibition of gratuitous, focused and abhorrently rude and insolent language from one person to another in all those years, as I see in the correspondence of the respondent to the applicant. Plus, especially by a person who signs them self as a professional person, that is a barrister.”

• [19] There was a further message in the decision conveyed by Her Honour to Mr Schlooz:

“I would find it astonishing that a person who uses such language in correspondence with any person, could possibly fulfil the criterion required of a barrister, of being a “fit and proper person”.”

• [20] Remarkably Mr Schlooz did not seem to take to heart the professional implications of either the making of the order against him or indeed, the very clear denunciation of his conduct by an extremely senior District Court Judge.

• [21] In his response to the Standards Committee he denied that he was acting in a professional capacity and suggested that he and the complainant were “... private individuals engaged in a war of words as a consequence of the breakdown in her marriage”. He went on to make personal and derogatory comments about the complainant in his response to the Standards Committee.

• [22] It was not until Mr Schlooz engaged counsel, Mr Judd, that he amended his formal response to the charges before the Tribunal and admitted the two charges of misconduct now under consideration.

• [23] By way of further background, during the period when this correspondence occurred, the practitioner was forming a new personal relationship himself, and together with his new partner was looking for a home they could purchase. In due course they did purchase an expensive home in order to accommodate their respective families, with 100 per cent mortgage

⁴ Footnotes omitted.

financing. These events, according to Mr Schlooz imposed considerable stress on him.

• [24] In addition Mr Schlooz was a volunteer in a drug trial, which he said depleted his energy, gave him significant headaches and meant that he was unable to work at times for half a day. All of these matters he puts forward as explanatory of, although not excusing, his conduct and the correspondence with the complainant.

• [25] The practitioner also acknowledged in his evidence to the Tribunal that he was personally involved in the dispute between the complainant and her estranged husband because of his close identification with his client, who he described as his “best friend”, and now accepts that caused him to lose judgement. The practitioner says that the emails, all of which are acknowledged by him, are significantly out of character.

The charges

• [6] The charges which Mr Schlooz admitted alleged that he had:

(a) been guilty of misconduct within the meaning of s 7(1)(a)(i) and (ii) and s 241(a) of the LCA, in that he had engaged in abusive, insulting and intimidating communications (rr 10 and 12 of the Lawyers and Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008 as in force at the relevant time (the Client Care Rules)); and

(b) been guilty of misconduct within the meaning of s 7(1)(a)(i) and (ii) and s 241(a) of the LCA, in that he had made threats for an improper purpose (rr 2.3 and 2.7 of the Client Care Rules).

• [7] Section 7 of the LCA provides, so far as is relevant:

7 Misconduct defined in relation to lawyer and incorporated law firm

(1) In this Act, misconduct, in relation to a lawyer ...,—

(a) means conduct of the lawyer ... that occurs at a time when he or she or it is providing regulated services and is conduct—

(i) that would reasonably be regarded by lawyers of good standing as disgraceful or dishonourable; or

(ii) that consists of a wilful or reckless contravention of any provision of this Act or of any regulations or practice rules made under this Act that apply to the lawyer ... or of any other Act relating to the provision of regulated services ....

• [8] Section 241(a) of the LCA confers jurisdiction on the Disciplinary Tribunal, if it thinks fit, to make orders authorised under s 242 of the Act. The orders include:

(a) suspension from practice for a period not exceeding 36 months;⁵

(b) censure;⁶

(c) paying the hearing costs of the Standards Committee;⁷ and

(d) reimbursing the New Zealand Law Society for the costs of the hearing.⁸

The Tribunal’s decision

The approach

• [9] The Tribunal observed, in describing its approach to the assessment of the appropriate penalty for Mr Schlooz’s breaches, that the starting point must be the seriousness of the conduct under consideration.⁹ It then said that it would consider the presence of any aggravating or mitigating features, both in relation to the conduct itself or the practitioner.¹⁰ It noted that “in a disciplinary framework mitigating factors personal to the practitioner cannot outweigh considerations of public protection” and that such personal factors “could not be given as much weight as they would, for example, in the context of sentencing in the criminal jurisdiction”.¹¹ Further, the Tribunal referred to the consideration of previous penalties imposed in similar cases:¹²

⁵ Section 242(1)(e).

⁶ Sections 242(1)(a) and 156(1)(b).

⁷ Sections 242(1)(a) and 156(1)(o).

⁸ Section 257.

⁹ Tribunal decision at [6], citing Hart v Auckland Standards Committee 1 of the New Zealand Law Society [2013] NZHC 83, [2013] 3 NZLR 103

¹⁰ At [7].

¹¹ Tribunal decision at [8], citing Bolton v Law Society [1994] All ER 486 at 496.

¹² At [9].

... in order to achieve the level of consistency and predictability which is necessary to conform to the principles of natural justice.

The seriousness of the misconduct

• [10] The Tribunal recorded and accepted the submission of counsel for the Standards Committee that:¹³

... in the category of behaviour involving harassment or bullying through written communications, this case must realistically be seen at the most serious end of the scale.

• [11] Although the Tribunal accepted that the case did not have the connotations of the abuse of power dynamic which existed in cases of alleged sexual harassment of young women by senior members of the legal profession, it agreed with counsel for the Standards Committee that a case demanding such condemnation on its facts as this one rarely came along. The Tribunal said:¹⁴

Under the more specific heading of abuse of the privileges of being a lawyer and bullying an opponent, particularly such as the complainant in this matter, this case is at the high end of the scale of seriousness.

• [12] The Tribunal regarded the aggravating features of the case as:

• the repeated and sustained nature of the abusive language and threats used;

• the use of this language against an unrepresented party;

• the level of misogyny present in the abusive comments;

• persisting with the conduct after the complainant made it clear the emails were unacceptable and should stop; and

• the lack of prompt apology and insight.

• [13] The Tribunal noted also that the repeated and sustained nature of the offending correspondence was relevant not just as an aggravating feature but also when

¹³ Tribunal decision at [26].

¹⁴ At [28].

considering some of the mitigating factors such as insight and “out of character behaviour”.

Mitigating factors

• [14] The Tribunal then considered the mitigating factors which it identified as follows:¹⁵

(a) Mr Schlooz unreservedly accepted that it was totally unacceptable to use the abusive, insulting and threatening language that he used and apologised to the complainant in his submissions to the Standards Committee.

(b) He had pleaded guilty in respect of the two charges, having changed his approach as soon as he had been advised by responsible counsel. Although Mr Schlooz reflected after receiving Judge Bouchier’s comments, he had, nevertheless, used the opportunity of his appearance before the Standards Committee to make further derogatory comments about the complainant.

(c) The Tribunal made the point that the case was “a glaring example” of why practitioners should not act for those who are close to them, saying he had no business being involved in the post-separation disputes between the parties.

(d) It was noted that Mr Schlooz was taking the positive step of addressing his conduct by attending counselling with a psychologist. But the Tribunal observed that the need for counselling did not sit entirely comfortably with his assertion, attested to by eight supporting deponents, that his conduct was entirely out of character. In the Tribunal’s view, the exploration of triggers for anger and other psychological issues was somewhat at odds with the asserted medical

¹⁵ Tribunal decision at [30]–[50].

mitigating factor of the effect of the clinical drug trials being undertaken by Mr Schlooz.

(e) There was no specific medical evidence to connect Mr Schlooz’s lack of control of his form of communication and professionalism, and adherence to professional standards, with the medication he was trialling. The Tribunal noted that if he had been involved in a trial which reduced his capacity to work to the extent he described, a practitioner with a very large mortgage to support might have re-assessed his priorities. The Tribunal also questioned the merits of continuing with the trial, given that he was suffering tiredness and headaches. In the end, the Tribunal did not attach any significant weight to the drug trial as a mitigating factor.

(f) The Tribunal afforded Mr Schlooz credit for his clean disciplinary record and, to a lesser extent, to the credit he had earned with colleagues and clients for his professionalism and skills in providing legal services in the past. It accepted as genuine and accurate as far as they went, affidavits that were supportive and complimentary, but considered that those views did not line up with the repeated and sustained nature of the misconduct. If it was truly out of character, it was unusual that it was repeated on 19 occasions over a period of 10 months. The Tribunal wondered whether it had the full picture of the difficulties faced by the practitioner causing his conduct.

• [15] The Tribunal considered the impact of suspension from practice, a penalty which had been urged on it by counsel for the Standards Committee. It noted that Mr Schlooz earned only half his income from legal practice; the other half coming from accounting or tax advice work. It observed that Mr Schlooz’s financial pressures arising from 100 per cent financing of an expensive home and working part-time because of his tiredness from the voluntary drug trial, were largely of his own making. In any event, Mr Schlooz would have his income from practising another profession to fall back on.
• [16] The Tribunal noted also that the personal circumstances of a practitioner would not be given undue weight in comparison with the purposes of the legislation which involves the upholding of professional standards, protection of the public, and the maintenance of public confidence in the profession.

The appropriateness of suspension

• [17] Accepting that natural justice required the Tribunal to take a consistent approach to like cases, both counsel had provided the Tribunal with an extensive survey of previous decisions. Counsel for Mr Schlooz had summarised all of the cases in which practitioners had been suspended by the Tribunal over the preceding two years. The Tribunal noted that it was not possible to superimpose cases with entirely different contexts and varieties of misconduct upon each other to form some form of template for penalty imposition. It said that the numerous factors arising out of the background, the particular circumstances of complainants and practitioners, and different aggravating and mitigating features, meant that it could not accept that suspension had been reserved for cases of dishonesty or multiple professional failures in dealing with clients.

• [18] The Tribunal cited the purposes of suspension as discussed by the High Court in Daniels v Complaints Committee 2 of the Wellington District Law Society, where the Court said:¹⁶

[24] A suspension is clearly punitive, but its purpose is more than simply punishment. Its primary purpose is to advance the public interest. That includes that of the community and the profession, by recognising that proper professional standards must be upheld, and ensuring there is deterrence, both specific for the practitioner, and in general for all practitioners. It is to ensure that only those who are fit, in the wider sense, to practise are given that privilege. Members of the public who entrust their personal affairs to legal practitioners are entitled to know that a professional disciplinary body will not treat lightly serious breaches of expected standards by a member of the profession.

Other factors

• [19] The Tribunal highlighted the importance of general deterrence and denunciation, observing that “rarely do cases come along which demand such

¹⁶ Daniels v Complaints Committee 2 of the Wellington District Law Society [2011] NZHC 1359; [2011] 3 NZLR 850.

condemnation on their facts as this one”.¹⁷ The Tribunal also said that, given the “somewhat compromised or confused level of insight and certainly a delayed one” on the part of Mr Schlooz,¹⁸ it considered that suspension would provide time for him to reflect on his conduct.

Fixing the suspension period

• [20] The Tribunal said it considered the case formed “the high water mark for cases of misconduct involving language or speech rather than actions or inaction”. It noted that in Orlov v The New Zealand Lawyers and Conveyancers Disciplinary Tribunal, a case involving offensive assertions and comments about a judge, a period of eight months’ suspension that had already been served by the practitioner was seen by the High Court as proper.¹⁹ The Tribunal considered that the comments in the present case were even more egregious and noted that they were directed to a litigant in person. However, having regard to a maximum available period of suspension of 36 months, and acknowledging that a suspension at the high end of the available period had been urged on it by counsel for the Standards Committee, it considered a suspension period of six months would be a realistic starting point for the type of misconduct involved in the case.

• [21] It then discounted that period by two months to take account of the aggravating and mitigating features that it had discussed and took account of the fact that the charge was admitted by Mr Schlooz and that he came to the disciplinary process for the first time with no previous disciplinary history.

Censure and costs orders

• [22] As well suspending Mr Schlooz for four months, the Tribunal censured Mr Schlooz in trenchant terms:

• [65] Mr Schlooz, your conduct towards Ms Y was utterly appalling. No member of the public or indeed any person dealing with you in a professional capacity ought to be subjected to the repeated abusive, offensive, belligerent, threatening and downright nasty and personal statements used by you.

¹⁷ Tribunal decision at [58].

¹⁸ At [60].

¹⁹ Orlov v The New Zealand Lawyers and Conveyancers Disciplinary Tribunal [2014] NZHC 1987.

• [66] Your conduct did not occur in a one heat of the moment loss of control. You persisted in a campaign of emails which the complainant found distressing, frightening and harassing. For a practitioner to have an Harassment Order made against him for his conduct during the representation of a client strikes a new low in this sort of professional misconduct.

• [67] Should you ever repeat this behaviour it is likely that you will no longer be found to be a fit and proper person to practise law.

• [23] In addition, the Tribunal ordered Mr Schlooz to pay costs of the Standards Committee in the sum of $22,443.26 and ordered him to reimburse the New Zealand Law Society of the full amount of costs under s 257 of the LCA which was certified at $3,027.

• [24] The Tribunal set out in an appendix to the decision the full particulars of the charges which comprised, essentially, the full text of the offending communications. It is unsurprising that the Tribunal’s decision received considerable attention from the news media at the time it was published; a feature referred to by Mr Judd in opposition to the appeal as having had a profound impact on Mr Schlooz and on his professional and personal reputations.

Submissions in support of the appeal

• [25] In this Court, Mr Collins submitted on behalf of the Standards Committee that while the Tribunal was correct to suspend and censure Mr Schlooz, the term of four months’ suspension was manifestly inadequate because:

(a) it was inconsistent with, and did not reflect:

(i) the gravity of the admitted misconduct; or

(ii) the Tribunal’s culpability findings;

(b) it did not adequately address the statutory purpose of maintaining public confidence in the legal profession; and

(c) it did not provide denunciation or deterrence at a level commensurate with the misconduct.

• [26] Counsel argued that a term of suspension of between 12 and 18 months would have been appropriate. Mr Collins noted that the Tribunal accepted the misconduct as being at the most serious end of the scale in the category of harassment or bullying through written communications, and that a District Court Judge had been highly critical of Mr Schlooz, questioning his status as a fit and proper person to be a lawyer. Mr Collins pointed to the aggravating features which he identified as:

(a) the offending taking place over a sustained period;

(b) the practitioner lacking insight, arguing that there was a series of “impulsive rushes of blood to the head” and saying that his anxiety and lack of sleep meant that he did not want to spend more time on the matter than he had to and used “profane, horrible language” that would just get the complainant off his plate.

(c) the deliberate and wilful nature of the emails being reinforced by elements of boastfulness and misogynistic content; and

(d) the behaviour being that of a male insulting and intimidating an unrepresented female party in litigation, a factor warranting a harsh penal response.

• [27] Mr Collins emphasised the lack of insight evident in Mr Schlooz’s continued reference to his behaviour being impulsive and his failure to acknowledge, until advised by counsel, that he was acting in a professional capacity in writing the emails. He had initially disputed the professional context of his actions, notwithstanding that the content was intended to address the various matters in dispute between the complainant and her husband, Mr Schlooz’s friend, and that he had signed off the communication in each case by reference to his professional status as a barrister.

• [28] In his discussion of suspension cases, Mr Collins referred to three cases in which the maximum penalty of 36 months’ suspension had been imposed. They included Daniels v Complaints Committee 2 of the Wellington District Law Society,²⁰

²⁰ Daniels v Complaints Committee 2 of the Wellington District Law Society, above n 16.

in which the practitioner was suspended for having formed a sexual relationship with a client whom he knew was:²¹

... a vulnerable and impoverished woman with a troubled background. He acted for her in matters of domestic violence from an abusive partner, proceedings involving care of her children (one of whom was intellectually handicapped), criminal proceedings (successfully), and ongoing custody and access disputes.

• [29] In Canterbury-Westland Standards Committee v Horsley,²² the practitioner was suspended for a period of 24 months on one defended charge related to an intimate personal relationship with a young and vulnerable female client who was 18 and the practitioner was aged in his 50s, and a concurrent period of 36 months’ suspension for misleading the Standards Committee.

• [30] A third case, National Standards Committee v Denham,²³ involved a 36-month suspension for misconduct for engaging in a private criminal prosecution and media campaign against the practitioner’s ex-husband in which the practitioner had also been found to be abusive of court processes intended to force her ex-husband into a favourable matrimonial settlement.

• [31] Mr Collins traversed cases involving suspensions for periods of 12 and 15 months, and also referred to cases in which periods of two to three months’ suspension had been imposed. Counsel summarised the principles to be drawn from the other cases, accepting that the Tribunal in the present case had considered and applied those principles in reaching its decision. Mr Collins provided a useful summary of the cases from 2017 to the present in which the Tribunal had made suspension orders. It is attached as an appendix to this judgment.

• [32] Mr Collins focused particularly on the Orlov decision,²⁴ submitting that the High Court noted that the original decision in that case had been to strike off the practitioner. At the time of the High Court’s decision, Mr Orlov had been struck off for a period of eight months, meaning that no further penalty was required in

²¹ Daniels v Complaints Committee 2 of the Wellington District Law Society, above n 16, at [7].

²² Canterbury-Westland Standards Committee v Horsley [2014] NZLCDT 9, [2014] NZLCDT 47.

²³ National Standards Committee v Denham [2017] NZLCDT 10, [2017] NZLCDT 30.

²⁴ Orlov v The New Zealand Lawyers and Conveyancers Disciplinary Tribunal, above n 19.

circumstances where the Court determined that striking off was an inappropriately harsh sanction. Mr Collins submitted that the present case involved more serious misconduct than Orlov and conduct of a very different nature, including:

(a) the extreme nature of the objectionable emails;

(b) the repeated pattern of conduct for most of a year; and

(c) the fact that the communications were directed at an unrepresented person in a legal dispute with Mr Schlooz’s client.

• [33] Mr Collins submitted that, although the Tribunal said that Orlov was a “roughly comparable” case, the Tribunal had then imposed a penalty of half the length of the effective penalty of eight months’ suspension in Orlov. Counsel argued that the present case was significantly worse than Orlov and that, since Orlov involved an effective suspension of eight months, the Tribunal’s decision to adopt a starting point of only six months and reduce it to four months was inexplicable.

• [34] The principal focus of Mr Collins’ submission, however, was that the Tribunal had accepted that the present case involved facts which represented the “high water mark for cases of misconduct involving language or speech rather than actions or inaction”.²⁵ But it then set a starting point from which it discounted one third, resulting in a penalty which sent the appropriate response for the worst cases of its type at too low a level. Mr Collins argued that the penalty would not inspire public confidence in the disciplinary regime in the legal profession and that four months’ suspension was out of step with the intensity of the Tribunal’s condemnation.

Submissions in opposition to the appeal

• [35] For Mr Schlooz, however, Mr Judd emphasised the personal mitigating factors that supported the Tribunal’s decision. He focused his principal argument on the harshness of a period of suspension as a penalty, given not only the implication that the practitioner has been found guilty of conduct not befitting a legal practitioner, but

²⁵ Tribunal decision at [61].

also a penalty that has a significant financial impact. Mr Judd noted that Mr Schlooz had not sought name suppression and supported the Tribunal’s assessment and application of the appropriate principles.

• [36] Mr Judd argued that suspension of a practitioner for any length of time is a severe penalty in preventing the practitioner from earning as a lawyer and causing “massive disruption” to his or her practice. He submitted that the legislative intent that suspension should be regarded as a severe penalty which is used sparingly is reflected in the requirement under s 244(2) of the LCA that at least five Tribunal members must agree to that penalty before it may be imposed.

• [37] Noting the emphasis placed by the Standards Committee on the High Court’s decision in Orlov, Mr Judd pointed to features of Orlov that were absent from the present case, including:

(a) the public nature of Mr Orlov’s derogatory statements about the judge that were made to courts, the Judicial Conduct Commissioner, the Human Rights Review Tribunal, the news media and others;

(b) the charges against Mr Orlov included breaching duties as an officer of the Court and undermining the Court’s process;

(c) there were serious question marks about the competence of Mr Orlov who had a poor disciplinary record; and

(d) Mr Orlov defended the charges; did not accept or take responsibility for his misconduct and was persistently rude and insulting in the way he dealt with the charges and the Tribunal.

• [38] In contrast, Mr Judd submitted, the communications in the present case were confined to the complainant alone; they were Mr Schlooz’s first offences arising in unusual circumstances and he did not represent any on-going threat to the public, having admitted his wrong-doing and seeking professional psychological assistance.

The Court’s appellate function

• [39] In Hong v Auckland Standards Committee,²⁶ Gordon J recently summarised the appellate approach for appeals to the High Court under s 253 of the LCA which proceed by way of rehearing.²⁷ Whether the appeal is against a misconduct finding, or against a penalty decision (with coasts the exception), the appeal is a general appeal.²⁸ This Court must consider the merits of the case afresh,²⁹ and be persuaded that the decision under appeal is wrong.³⁰ The weight to be given to the Tribunal’s reasoning is a matter for the Court,³¹ which may consider it appropriate to give the specialist tribunal’s assessment due regard.³²

• [40] The parties are entitled to judgment in accordance with the appellate court’s opinion, even where that opinion is an assessment of fact and degree, entailing a value judgment.³³ If my opinion differs from the Tribunal’s conclusion, then the decision under appeal is wrong in the only sense that matters, even if it was a conclusion on which minds might reasonably differ.³⁴

• [41] The High Court exercises a supervisory jurisdiction over the legal profession and its disciplinary processes, and the Court is required to come to its own view of the appropriate penalty. It is appropriate, however, in a case that is likely to provide guidance to the profession and to those charged with responsibility for the disciplinary procedures under the LCA that my conclusions should be informed by the Tribunal’s views. In taking that approach, I have regard to the specialist nature of the Tribunal, the standing and experience of its members, and its expertise in deciding case of this kind.

²⁶ Hong v Auckland Standards Committee No 5 [2020] NZHC 1599 at [54]–[56].

²⁷ Lawyers and Conveyancers Act 2006, s 253(3)(a).

²⁸ Sisson v Standards Committee (2) of the Canterbury-Westland Branch of the New Zealand Law Society [2013] NZHC 349, [2012] NZAR 416 at [15]; Davidson v Auckland Standards Committee 3 [2013] NZHC 2315, [2013] NZAR 1519 at [6]–[9].

²⁹ Kacem v Bashir [2010] NZSC 112, [2011] 2 NZLR 1 at [31].

³⁰ Austin, Nichols & Co Inc v Stichting Lodestar [2007] NZSC 2013, [2008] 2 NZLR 141 at [13].

³¹ Kacem v Bashir, above n 29, at [31]. No deference is required beyond the customary caution when seeing the witnesses gives an advantage when credibility is important (Austin, Nichols & Co Inc v Stichting Lodestar, above n 30, at [13]).

³² Orlov v New Zealand Lawyers and Conveyancers Disciplinary Tribunal, above n 19, at [191];

Young v National Standards Committee [2019] NZHC 2268 at [34].

³³ Davidson v Auckland Standards Committee, above n 28, at [6] - [9].

³⁴ Austin, Nichols & Co Inc v Stichting Lodestar, above n 30, at [16]; and Kacem v Bashir, above n 29, at [32].

Discussion

• [42] I am not persuaded the Tribunal erred in this case. The Tribunal addressed the relevant circumstances appropriately, including by characterising the communication in its statement of censure as repeatedly abusive, offensive, belligerent, threatening and downright nasty, and as having a distressing, frightening and harassing effect on the complainant. As the Tribunal indicated, the appalling abuse and personal invective that characterises the language used by Mr Schlooz was intended by him, from a position of some authority as a legal practitioner, to intimidate and dissuade a self- represented litigant from pursuing claims she considered to be legitimate. Moreover, the abuse and threats continued notwithstanding the complainant’s repeated requests to Mr Schlooz to stop behaving in that manner towards her.

• [43] The Tribunal was justified, therefore, in placing the case at the upper end of seriousness of such cases. But the category of case the Tribunal was considering was a category that did not involve public abuse and humiliation. Apart from the intimidating aspects designed to dissuade the complainant from pursuing her claims, it did not involve any direct abuse or contravention of the practitioner’s duties as an officer of the Court.

• [44] Bearing those features in mind, I agree with Mr Judd that Orlov was a more serious case, involving repeated attacks on the competence of a judicial officer in the context of statements in proceedings before judicial and quasi-judicial bodies that were capable of being published. The practitioner never acknowledged his misconduct to be inappropriate.

• [45] In Orlov, the High Court expressly rejected consideration of what the appropriate sanction would be for Mr Orlov, simply observing that he had been struck off for eight months and that no further penalty was required. The judgment, therefore, should not be read as setting an appropriate level of penalty for serious misconduct involving only language or speech.

• [46] It is clear, however, that the Tribunal was mindful in this case that it was setting a benchmark for misconduct of this kind. It adopted a principled approach to the assessment of the appropriate penalty, not dissimilar to the approach taken by the

courts in sentencing criminal offenders. It first assessed the seriousness of the misconduct, having regard to the core misconduct which was the use of outrageous language that was repeated and intimidatory but expressed in private. The Tribunal then considered whether there were aggravating or mitigating features of the misconduct that would have required it to either increase the penalty from the level appropriate to the misconduct itself or result in a discount. Finally, it considered personal factors in mitigation, namely the admission of responsibility and the fact that Mr Schlooz was a first-time offender with no prior disciplinary history. In looking at the level of penalty required to mark the case as one deserving substantial condemnation and to act as a general deterrent, the Tribunal paid proper regard to the penalties imposed in other cases.

• [47] The High Court observed in Orlov that it had been referred to “many examples of speech as misconduct”,³⁵ both in New Zealand and overseas, where the outcomes were much lower than suspension in terms of penalty, and fines were frequently regarded as sufficient to mark appropriate disapproval. That assessment in reference to the other cases tends to indicate that suspension for any period would be seen as marking a high degree of disapproval. A starting point of six months’ suspension for the most serious cases of the type is a significant penalty, likely to result in a substantial loss of income for the practitioner and to cause severe disruption to his or her practice. In my view, setting a starting point of suspension for a period of 12 months, being the lower end of the range that the Standards Committee submitted would have been appropriate in this case, would be disproportionately high for the most serious cases of first offending of this nature.

Decision and result

• [48] The decision to allow a two-month discount on the grounds of Mr Schlooz’s admission of guilt, measures taken to address the underlying causes of his aberrant behaviour and his prior good record, was open to the Tribunal in the exercise of its discretion and I am not persuaded to interfere with it. In my view, the Tribunal was right to determine that suspension is an available response in a serious case of

³⁵ Orlov v The New Zealand Lawyers and Conveyancers Disciplinary Tribunal, above n 19, at [203].

misconduct by language or speech. It was also right to assess that a six-month suspension was an appropriate upper limit by reference to the maximum available penalty of 36 months and to the ranges of penalties imposed for other forms of misconduct.

• [49] I have concluded, therefore, that there was no error in the Tribunal’s approach: its decision was correct in principle and appropriate in the circumstances. I dismiss the appeal accordingly.

Costs

• [50] Mr Schlooz is entitled to costs which ought to be capable of agreement between the parties without further intervention by the Court. If the Court is required to rule on costs, however, then Mr Schlooz shall have until 21 September 2021 to file and serve a memorandum seeking costs. The Standards Committee shall have 15 working days from service of memorandum on behalf of Mr Schlooz to file and serve a memorandum in response. Mr Schlooz may file a brief reply memorandum only by leave of the Court. Costs shall be determined on the papers unless the Court directs otherwise.

Toogood J

Appendix

Suspension Orders 2017 - 2021
No.	Case Name		Date of Decision	Description			Suspension and other penalties
1.	Canterbury-Westland Standards Committee 3 v Woulfe [2017] NZLCDT 5		16 March 2017	Negligence or incompetence in authenticating forged signature on A&I form.			2 months and censured
2.	Auckland Standards Committee 1 v Cropper [2017] NZLCDT 6		7 April 2017	Conviction on 3 charges of possession of methamphetamine class A controlled drug.			3 months
3.	Auckland Standards Committee 1 v Chen [2017] NZLCDT 7		20 April 2017	Multiple driving convictions including 4 punishable by a term of imprisonment, failure to disclose convictions to NZLS when applying for a practising certificate.			2 years, $5,000 fine and censure
4.	Auckland Standards Committee 1 v Hintze [2017] NZLCDT 13		7 June 2017	5 charges of misconduct admitted; receiving payments in advance without issuing an invoice and failing to undertake client’s instructions, breaching trust account regulations and failing to provide clients with information or failure to attend court.			18 months
5.	Auckland Standards Committee 1 v Latton [2017] NZLCDT 14		8 June 2017	Lying to client about submitting settlement offer and backdating settlement letter in report to client.			1 month, fine of $7,000 and censure
6.	Auckland Standards Committee 2 v Fox [2017] NZLCDT 26		29 September 2017	Non-compliance with financial orders (fines and costs) made by Standards Committees on 4 occasions, failing to honour repayment agreements with NZLS, making false declarations in practising certificate renewal.			6 months
7.	National Standards Committee Denham [2017] NZLCDT 30	v	7 December 2017	Mis-using legal processes to support relationship property claim.			3 years and censure
8.	Wellington Standards Committee 2 v Morahan [2017] NZLCDT 34		22 November 2017	Negligence or incompetence in acting for client in Family Court, wrongly referring to instructing solicitor in court documents.			4 months36
9.	Hawke’s Bay Standards Committee v Dender [2017] NZLCDT 39		22 December 2017	Conviction on criminal charge of male assaults female and injuring with intent to injure.			2 years and censure
10.	Central Standards Committee 3 v S [2018] NZLCDT 12		20 April 2018	Failure to pay costs order of $12,000, failure to adhere to repayment arrangement and failure to engage with Complaints Service.			8 months
11.	National Standards Committee v Shi [2018] NZLCDT 18		8 May 2018	2 charges conflicting transaction documents.	of misconduct interests in and falsely	admitted; property certifying	15 months
12.	Auckland Standards Committee v name suppressed [2018] NZLCDT 19		14 May 2018	Non-compliance with Standards Committee investigatory orders.			4 months and censure
13.	National Standards Committee v Young [2018] NZLCDT 20		15 May 2018	2 charges of misconduct 1 of negligence and 1 of unsatisfactory conduct; incompetence in litigation.			15 months
14.	Canterbury-Westland Standards Committee v Johnson [2018] NZLCDT 2018		22 May 2018	Negligence and misconduct, non- compliance with Trust Account Regulations and issuing false certificates.			3 months and censure
15.	Auckland Standards Committee 3 v Ellis [2018] NZLCDT 25		3 August 2018	Acting in multiple client conflicts – serious past disciplinary record.			6 months and censure

³⁶ Upheld on appeal; Morahan v Wellington Standards Committee 2 [2018] NZHC 1229.

Suspension Orders 2017 - 2021
No.	Case Name			Date of Decision	Description			Suspension and other penalties
16.	Legal Complaints Review Morrison [2018] NZLCDT 40	Officer	v	27 November 2018	Manipulation of trust deed, creating a fraudulent document.			6 months
17.	Auckland Standards Committees 2 & 3 v Mason [2019] NZLCDT 5			8 March 2019	Acting in conflict of interest and duty and non-compliance with previous costs and compensation orders imposed by Standards Committees.			15 months
18.	Otago Standards Committee v Claver [2019] NZLCDT 8			29 March 2019	Numerous instances of incompetence in courtroom conduct including failure to appear, misleading the Court and failure to properly advise clients.			12 months and ordered not to practice on own account
19.	Auckland Standards Committee 1 v Arman [2019] NZLCDT 18			8 July 2019	Admitted incompetence in criminal defence practice, pressuring client to plead guilty.			10 months and ordered not to practice on own account
20.	Auckland Standards Committee v Dangen [2019] NZLCDT 2			14 August 2019	Receiving fees for work as attorney after giving affidavit saying no fees would be charged.			2 months
21.	Auckland Standards Committee 2 v Lawes [2019] NZLCDT 31			14 October 2019	Non-compliance with Trust Accounting Regulations (not involving dishonesty), acting in circumstances of conflicting duties.			3 months, ordered not to practice on own account, refund fee $1,000 and to pay compensation
22.	Waikato-Bay of Plenty Standards Committee 1 v Campion [2019] NZLCDT 32			17 October 2019	Incompetence in administration of estate and trust, delay and failure to follow instruction.			2 years and ordered to pay compensation of $11,646.38 and $7,500
23.	Auckland Standards Committee 5 v Hong [2019] NZLCDT 40			23 December 2019	Obstructing NZLS trust account inspector.			3 months and ordered not to practice on own account37
24.	Canterbury-Westland Standards Committee 1 v Williams [2020] NZLCDT 8			28 February 2020	Acting in conflicts of interest and duty in administration of trusts.			9 months
25.	Canterbury-Westland Standards Committee Standards Committee 2 v Woodward [2020] NZLCDT 9			4 March 2020	Acting where personal interest in transactions and non-compliance with trust account regulations.			9 months
26.	Auckland Standards Committee 1 v Hooker [2020] NZLCDT 15			29 May 2020	Misconduct in failing to deal appropriately with mistaken payment received on behalf of client and using mistaken payment to pay fees.			3 months
27.	Auckland Standards Committee 2 v Burcher [2020] NZLCDT 18			30 June 2020	Continuing to act for clients after earlier suspension order imposed.			2 months censured38	and
28.	Hawke’s Bay Standards Committee v Queenin [2020] NZLCDT 26			25 August 2020	Misleading by failing to disclose past disciplinary record, failure to comply with undertaking to Standards Committee.			3 months censured	and
29.	National Standards Committee v Young [2020] NZLCDT 30			25 September 2020	Incompetence in disciplinary record).	litigation	(adverse	30 months and ordered to cancel fees
30.	Auckland Standards Committee 2 v Mason [2020] NZLCDT 38			1 December 2020	Non-compliance with Trust Accounting Regulations.			3 months censured	and

³⁷ Upheld on appeal; Hong v Auckland Standards Committee 5 [2020] NZHC 744.

³⁸ Misconduct findings reduced on appeal in Burcher v Auckland Standards Committee 2 [2020] NZHC 43.

Suspension Orders 2017 - 2021
No.	Case Name			Date Decision	of	Description	Suspension and other penalties
31.	Auckland Standards Committee v Taia [2020] NZLCDT 39			1 December 2020		Failing to rectify error in e-dealing, failing to comply with investigator’s request for access to client’s file and failure to comply with earlier costs order.	9 months censured	and
32.	Nelson Lawyers Standards Committee v Stevenson [2020] NZLCDT 42			15 December 2020		Making threats to Police officer and appearing in court while intoxicated on multiple occasions.	18 months
33.	National Standards Committee Wilson [2021] NZLCDT 16	2	v	14 May 2021		Engaging in intimate relationship with prisoner while acting for that person, and misleading prison authorities.	12 months.
34.	Auckland Standards Committee 4 v Schlooz [2021] NZLCDT 12			14 April 2021		Insulting and intimidating emails and wrongful threats.	4 months
35.	Auckland Standards Committee 2 v Johnson [2021] NZLCDT 19			28 May 2021		Settling debt for trust without trustees’ approval and making unauthorised payment from trust funds, irresponsibly defending trustees’ claim.	6 months, censured and ordered not to practice on own account
36.	Auckland Standards Committee 1 v Choi [2021] NZLCDT 20			27 May 2021		Conviction for obstructing the exercise of a power under s.44(1) of the Overseas Investment Act 2005.	Approximately 6 months (3 June – 25 September 2021)