Auckland Standards Committee 2 v Devoy [2024] NZLCDT 22 (1 August 2024)

Last Updated: 24 August 2024

NEW ZEALAND LAWYERS AND CONVEYANCERS DISCIPLINARY TRIBUNAL

[2024] NZLCDT 22

LCDT 012/23, 001/24 & 002/24

IN THE MATTER of the Lawyers and Conveyancers Act 2006

BETWEEN AUCKLAND STANDARDS COMMITTEE 2

Applicant

AND MARIE ELIZABETH DEVOY

Respondent

CHAIR

Dr J Adams

MEMBERS OF TRIBUNAL

Mr S Hunter KC Ms G Phipps Ms S Stuart

Ms P Walker MNZM

DATE OF HEARING 26 July 2024

HELD AT Specialist Courts and Tribunals Centre, Auckland

DATE OF DECISION 1 August 2024

COUNSEL

Mr P Collins for the Standards Committee (012/23)

Ms N Town for the Standards Committee (001/24, 002/24) No appearance by or for the Respondent Practitioner

DECISION OF TRIBUNAL ON LIABILITY AND PENALTY

[1] This decision records a coincidence, both happy and unhappy. We are happy to rectify a mistake, and it is fortuitous that we can do this at a time when we can make some gesture of reparation to Ms Devoy. Nonetheless, it is unhappy that the rectification of one inadvertent error on our part coincides with our duty to deal with two fresh, admitted charges.

[2] We address the following issues:

• Do we have jurisdiction to recall and rescind orders?
  
• What is the gravity of the new charges?
  
• What penalty should we impose in this context?
  

Jurisdiction to recall and rescind

[3] In October 20231, in unopposed proceedings, we made a finding of misconduct against Ms Devoy for failing to comply with an order of the Standards Committee requiring her to send a file to another practitioner. Subsequently, the New Zealand Law Society became aware of evidence indicating that the file had been delivered about July 2021. The discovery was unrelated to the material the Society held relating to the 2023 charge. We accept that the Standards Committee was not at fault in advancing its case in 2023 as it did.

[4] Understandably, the New Zealand Law Society and the Standards Committee wish to undo, to the extent possible, the inadvertent miscarriage of justice. In our 2023 decision, we recorded Ms Devoy’s failure to respond to those proceedings. She has

1 Auckland Standards Committee 2 v Devoy [2023] NZLCDT 45.

now confirmed2 what we suspected, that she has been unwell and overwhelmed, and that she found herself unable to deal effectively with practice or disciplinary issues.

[5] We have no inherent powers. The Tribunal is a creature of statute. It is irrefutable that, in respect of the matter before us in 2023, we are functus officio. Does this mean we are powerless to fix the wrong we did, a wrong founded on a mistake of fact?

[6] We would not hesitate to remedy slips and omissions in a decision but those steps fall well short of setting aside a conclusory decision. There is no express statutory power to rehear a concluded proceeding.

[7] It is arguable that the path to rectify this unusual mistake is by way of appeal. On the other hand, there is no apparent fault in process or reasoning in our 2023 decision. The fault was external.

[8] We commend the applicants for pursuing this matter. It offends justice that the 2023 decision should remain. If we take a formal approach and merely turn our face away, we perpetuate a stain on Ms Devoy’s record that is unfair. That she did not defend the matter is understandable in her circumstances and we do not expect she would marshal the energy to pursue an appeal or other remedy. Time for appeal has long since lapsed.

[9] This is not a situation in which there is any doubt about what the result should be. The offending decision and orders should be set aside. We would like to do it, if we can, without further trouble and expense.

[10] Mr Collins has carefully researched the law and we record his central submissions and case references:

• 2.3 It is accepted that there is no express power to recall and reverse otherwise final decisions of the Tribunal. Perceived errors would normally be addressed by way of an appeal to the High Court under s.253. If the jurisdiction exists at all to recall and rescind an earlier decision – which counsel submits it does – then it arises under the implied powers available to the Tribunal to achieve justice in cases coming before it, consistently with the general power under s.252 for the Tribunal to determine its own procedures.
  

2 Email Ms Devoy to Mr Collins 26 July 2024.

2.4 The Tribunal’s jurisdiction to determine its own procedure has been described as “a wide-ranging power”3 and has been invoked in situations not expressly authorised by the Act. Examples include the power to determine an application to dismiss charges on the assertion of “no case to answer”,4 the power for the Tribunal to involve itself in “some form of settlement process”,5 and the power to engage a practitioner post-penalty about supervisory and rehabilitative arrangements.6 The consistent theme is the exercise of the Tribunal’s powers to achieve justice, and to maintain public confidence in the legal profession, in its broad disciplinary jurisdiction over lawyers.

2.5 The statutory function of the Disciplinary Tribunal to hear and determine charges, under s.227(b) of the Act, is logically connected with the ability to hear and determine an application to recall and rescind findings on the same charges if a miscarriage of justice would otherwise occur. It would be an unnecessary constraint on the jurisdiction of the Tribunal, detrimental to the administration of justice in this area, if it could not do so.

[11] We do not choose to shelter behind a formalistic hedge. In the unusual and non-contentious circumstances of this case, we are persuaded that we have jurisdiction to entertain this application to do justice, to recall and rescind findings and penalties in our 2023 decision.

[12] We recall that decision and discharge all the orders recorded in it, except for order 5, which required the New Zealand Law Society to pay the Tribunal costs.

[13] We note that the costs orders against Ms Devoy were not paid so she is not disadvantaged in that respect. Ms Devoy was subject to an order that suspended her from practice for six months. Although throughout that period she was not seeking to practice, and held no practising certificate, she has served that penalty (on her record). We take it into account in dealing with the new charges.

The gravity of the new charges

[14] Ms Devoy admits the facts relating to the two new charges of misconduct. One charge arises from Ms Devoy’s failure to assist the Law Society in exercising its regulatory function in relation to the trust account of CityLaw legal practice. The other

3 Orlov v National Standards Committee No.1 & Auckland Standards Committee No.1

[2013] NZHC 1955 at [13].

4 Hall v Wellington Standards Committee (No.2) [2013] NZHC 798 and Wellington Standards Committee (No.2) v Hall [2012] NZLCDT 7 (although the power to find no case to answer has now been eclipsed by the statutory strike-out jurisdiction in s 240A.

5 See above n 3 at [22].

6 As happened in LCDT 006/22 Auckland Standards Committee 1 v Ms A ([2023] NZLCDT 11).

arises from her longstanding failure to provide competent service to her client in an estate matter.

[15] Ms Devoy did not attend the hearing. She admitted the charges by email shortly before the hearing. We accept that her defaults arose within the context of her unwellness, some compounding personal challenges, and her consequent inability to “front up” to her professional duties or to take steps to obtain adequate help. Harsh though it may seem, we do not excuse these defaults. Our duty to protect the public requires us to take an adamant line. Unwellness can affect any lawyer at any time. Our message to the public and the profession is that, where unwellness intrudes, the professional obligation to obtain help, transfer work, and alert the Law Society to the difficulties, must be observed.

[16] The Law Society Inspectorate were actively involved in liaison with, or pursuing, Ms Devoy to regularise her trust account from February 2023 onwards. Ms Devoy told the Inspectorate that she found the process overwhelming and wanted to close her firm. She failed to provide information that was sought. Between August 2022 and April 2023, her firm’s FIT account was overdrawn and not rectified immediately (breaches of regs 6(1) and (3)). The trust account was not reconciled between October 2022 and April 2023. Although the difference was a consistent figure of $223.99, it evidenced failure to reconcile the account over those months. A sum of $11,952.05 was held in the IBD account that was not recorded in the trust account ledger. From August 2022, she failed to provide monthly certificates to the Law Society.

[17] It is not alleged that Ms Devoy was dishonest about client funds but proper management of client funds requires reconciliation of accounts and meticulous accounting. Ms Devoy simply let it slide. Apart from other problems, this behaviour causes unnecessary work and expense for the Law Society which tries to ensure practitioners satisfy their accounting obligations. These costs are borne by the profession. These failures may have been remedied had Ms Devoy employed a competent person to attend to the details. We regard the failures in relation to her trust account as moderately grave.

[18] The estate file default persisted from late 2021. In what appears to have been a simple estate matter, Ms Devoy failed to keep track of progress on documents to obtain probate. An affidavit (presumably to support application for probate) required

execution. One deponent was in Melbourne, another in the Coromandel. Ms Devoy stopped corresponding with her client and subsequently failed to deliver the file to another lawyer who was instructed to replace her. This was poor conduct. Estate matters are often distressing for family members. To be simply ignored for long periods of time, and to fail to respond in any way to client enquiries, is conduct that affects the reputation of the profession generally, as well as causing unnecessary distress for clients. Ms Devoy advises the Tribunal that she intends to send the will document to the new solicitors shortly. Her conduct amounts to a distressing default.

What penalty?

[19] In her written submissions, Ms Town submitted that a period of suspension of 14 months would be appropriate. In light of the fate of the 2023 case, she accepted that adjustment was appropriate, given that Ms Devoy had notionally served a suspension of six months upon a mistaken premise. Ms Devoy has been trying to wind up the remaining obligations from her practice. Ms Town is concerned about the precedent value of our decision on these two charges.

[20] We acknowledge that we should state what penalty these charges would attract were it not for the complication of our 2023 error. Pragmatically, we note that Ms Devoy will not actually serve any further suspension because she has given up practice. In the circumstances, we are inclined to be merciful about a fresh order for suspension.

[21] Ms Devoy has four previous findings of unsatisfactory conduct. A 2014 breach of an undertaking is the only one that falls outside the time when her wellbeing was failing. The others, (a 2020 failure to act in a timely manner, and two failures to respond to requests from a client), appear to be driven by her inability to cope. Were it not for the 2023 error, and if that had not formed part of her disciplinary record, we assess that we would have imposed suspension from practice for 12 months on these two fresh charges. This (notional) period of suspension reflects the seriousness with which the Tribunal regards any failure to administer a trust account properly. Because she had the burden of an unwarranted six months’ suspension, we do not make any order for suspension on these two charges.

[22] Ms Devoy has not suffered any burden from the 2023 costs orders which are rescinded. We see no principled basis to relieve her from the ordinary costs result in respect of the two charges of misconduct she has admitted.

[23] The facts in relation to the two charges heard on 26 July are admitted by Ms Devoy and we find that both matters reach the level of misconduct.

Orders

[24] Our orders are:

1. The decision of 13 October 2023 is recalled, and all orders made in that decision are rescinded, except order 5, which required the New Zealand Law Society to pay the Tribunal costs.
   
2. In accordance with paragraph [21], we do not impose a fresh order of suspension.
   
3. The New Zealand Law Society shall have no order for costs on the application relating to the 2023 decision.
   
4. Ms Devoy shall pay the Standards Committee costs in the sum of $5,365, in relation to the two new charges. (pursuant to s 249 of the Act)
   
5. The New Zealand Law Society shall pay the Tribunal costs for all three matters, certified in the sum of $2,258. (pursuant to s 257 of the Act)
   
6. Ms Devoy shall reimburse the New Zealand Law Society in full for the Tribunal s 257 costs in relation to the two new charges, amounting to

$1,416. (pursuant to s 249 of the Act)

7. An order prohibiting Ms Devoy from practising on her own account, whether in partnership or otherwise, until authorised by the Disciplinary Tribunal to do so. (pursuant to s 242(1)(g) of the Act)

DATED at AUCKLAND this 1st day of August 2024

Dr JG Adams Deputy Chair