Waikato Bay of Plenty Standards Committee 1 v Noort [2024] NZLCDT 33 (17 October 2024)

Last Updated: 31 October 2024

NEW ZEALAND LAWYERS AND CONVEYANCERS DISCIPLINARY TRIBUNAL

[2024] NZLCDT 33 LCDT 009/23

IN THE MATTER of the Lawyers and Conveyancers Act 2006

BETWEEN WAIKATO BAY OF PLENTY STANDARDS COMMITTEE 1

Applicant

AND JOHANNES (JACQUES) VAN NOORT

Practitioner

CHAIR

Ms D Clarkson

MEMBERS OF TRIBUNAL

Ms K King Ms A Kinzett

Mr T Mackenzie Prof D Scott

ON THE PAPERS

DATE OF DECISION 17 October 2024

COUNSEL

Ms E Mok for the Standards Committee

Mr T Conder for the Respondent Practitioner

DECISION OF THE TRIBUNAL ON PENALTY AND COSTS

What this was about

[1] Mr van Noort is a now-retired lawyer who held himself out to be an expert in Trusts and means-tested subsidy applications. In February 2020, he was asked to assist the K family in seeking a subsidy for their father’s residential care. The father, TK, had settled a Trust in 2010, but there was very scant record keeping between then and when his children1 sought Mr van Noort’s help.

[2] There had been somewhat complicated dealings with TK’s property, including the sale and purchase of three homes and gifts made to his children.

[3] In March 2020, just before the first COVID-19 lockdown, Mr van Noort attempted to reconstruct the trust dealings, and to formulate resolutions and documents in a way which would assist the subsidy application. The practitioner was anxious to get as much documentation prepared as possible, because the care facility where TK resided was about to stop visitors because of the pandemic.

[4] Between 20 March 2020 and 25 April 2020, Mr van Noort prepared documents detailing the trust’s dealings, including a Deed of Acknowledgement of Debt. A number of these documents were incorrect and did not represent a true picture of the dealings within the family. Further, the practitioner prepared them backdated, and suggested that he was intending to declare the reconstruction and backdating before registering and presenting them to the Ministry of Social Development (MSD).

[5] The errors would, if acted on, have led to MSD being provided with a false account of the movement of funds. One of the serious errors pointed out to Mr van Noort in June 2020, involved a suggested loan which had not been made, but he did not correct the position, rather advised the family to press on with the document as he had formulated it.

1 The children were beneficiaries of the Trust, along with TK.

[6] The family ended Mr van Noort’s retainer in September 2020, and did not use the documents or subsidy application prepared by him.

Process

[7] Although the Standards Committee originally filed charges at a higher level, further information led to an agreed resolution of the charge to one of unsatisfactory conduct, and Mr van Noort accepted liability at that level. The Tribunal approved the necessary amendment of charges.

[8] Penalty and cost submissions were filed and by agreement, the matter was dealt with on the papers, with an agreed statement of facts having been filed.2

Standards Committee position

[9] The Standards Committee submitted that, having regard to the nature and gravity of the unsatisfactory conduct, his previous disciplinary history, and his acceptance of his conduct, that the appropriate penalty would be censure together with a fine in the vicinity of $7,000 – $8,000. Further, an order was sought requiring Mr van Noort to reimburse TK’s family for fees charged by him.

[10] Having regard to the reduction in charges and large measure of agreement reached, the Committee sought a 40 per cent contribution to the costs of the prosecution. These were significant, at $38,765.60.

Practitioner’s position

[11] Mr Conder submitted that the matter should not have gone beyond the jurisdiction of the Standards Committee, having regard to the fact that unsatisfactory conduct had been the agreed outcome and given the “...unusual nature of the instructions and the additional stressors posed by the first COVID-19 lockdown”. He submitted that a fine in the region of $3,000 – $6,000 together with costs of $3,000 would be appropriate. Mr Conder also resisted the repayment of the legal fees. Mr Conder submitted that costs ought to be at the type of level that would have been ordered had the matter remained with the Standards Committee.

2 This is annexed as Appendix 1 to this decision.

[12] There was also a disagreement as to the level of seriousness of the conduct, Ms Mok submitting that it was moderate to high for cases involving unsatisfactory conduct, whereas Mr Conder submitted that it was “only moderately serious”.

Discussion

[13] Mr van Noort accepted responsibility for the following breaches of the Lawyers and Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008 (the Rules):

• (a) Failing to provide a letter of engagement with client care information to all members of TK’s family (breaching rr 3.4 and 3.5).
  
• (b) Not providing prompt responses to communications and delaying the progression of the retainer (thereby breaching rr 3, 3.2, 3.3 and 7.2).
  
• (c) Incorrectly completing land transfer documents, in particular authority and instruction forms and land transfer tax statements, which then required redrafting by the conveyancing solicitors engaged by TK’s family (this breached r 3).
  
• (d) Not preparing the Trust documentation in a competent manner (contrary to r 3).
  

[14] The Tribunal found the conduct to be moderately serious at the level of unsatisfactory conduct. The Tribunal was concerned about the aggravating feature of two previous disciplinary findings against Mr van Noort, some of which mirrored his failings in the present case. The second disciplinary finding in 2017, was by the Tribunal of negligence pursuant to s 241(c) of the Lawyers and Conveyancers Act 2006 (the Act).

[15] The Committee accepted that by accepting responsibility for his conduct and pleading guilty to the amended charge, Mr van Noort was entitled to claim this as a mitigating feature.

[16] We also note that it seems to be common ground that TK’s family had to some extent contributed to the delays in progressing the retainer.

[17] The Tribunal had some evidence that the practitioner’s health had been delicate for some time and that this had been confirmed by his decision to retire permanently from the practice of law.

[18] Each case must be assessed on its own facts, but we note that counsel referred us to two similar cases, Park and McDonnell.3 Mr Park had been censured and ordered to pay a fine of $5,000 and Ms McDonnell was censured and fined $8,000 by the Standards Committee, which was upheld by the Legal Complaints Review Officer (LCRO).

[19] We were somewhat concerned at the level of costs incurred by the Standards Committee and considered they could have been further limited. This will be reflected in the order for costs. The Tribunal costs have been minimised by the large measure of agreement reached between counsel and their willingness to have the matter considered on the papers. We considered that the practitioner ought to be able to pay the full amount of these costs.

[20] We do not consider that a censure is meaningful for a practitioner who is at the end of his legal career.

[21] Standing back from the matter and taking account that there is no element of public protection involved, given the retirement of the practitioner, we consider that the conduct in this case is properly marked by the following orders.

Orders

1. A fine in the sum of $7,000. (pursuant ss 156 and 242 of the Act)
   
2. Mr van Noort is to pay $10,000 towards the costs of the Standards Committee. (pursuant to s 249 of the Act)
   
3. The New Zealand Law Society is to pay the Tribunal costs in the sum of

$3,018. (pursuant to s 257 of the Act)

3 Auckland Standards Committee 3 v Park [2024] NZLCDT 6; and McDonnell v LA LCRO 003/2017 and LCRO 148/2017.

4. Mr van Noort is to reimburse the New Zealand Law Society in full for the Tribunal costs. (pursuant to s 249 of the Act)
   

DATED at AUCKLAND this 17th day of October 2024

DF Clarkson Chairperson

Appendix 1

Statement of Accepted Facts

May it please the Tribunal –

The Waikato Bay of Plenty Standards Committee Number 1 (the Committee) and Johannes (Jacques) van Noort (the Practitioner) have agreed the following matters of fact for the purpose of the hearing of this complaint, so as to dispense with the proof thereof.

Where reference is made to key correspondence and/or documentation below, reference is also made to its location in the enclosed bundle (in the format “Tab X”) filed together with this Statement of Accepted Facts.

The statement of accepted facts is as follows:

1. At all material times, the Practitioner was enrolled as a barrister and solicitor of the High Court of New Zealand.
2. The Practitioner has retired from the practice of law, and currently does not hold a practising certificate as a lawyer. He has no intention of resuming practice as a lawyer or applying to hold a practising certificate in future.
3. J, K, and N K are siblings (the K Siblings).
4. The K Siblings are the children of the late TK.
5. TK, by deed dated 10 September 2010, settled the TGK Family Trust (the Trust).1
6. Between 2010 and 2020, scant records were maintained of the trustees’ decision- making, the Trust’s assets, financial position, distributions from, and settlements on and gifts to, the Trust, and other trust matters.
7. T and K were the initial trustees of the Trust. T and the K Siblings were beneficiaries of the Trust.
8. At the time the Trust was set up, T was the registered proprietor of a residential property on F Street, W, Auckland.
9. T and the K Siblings had understood that T had disposed of his interest in the F Street to the trustees of the Trust, but he had not in fact done so when he disposed of the F Street property in 2011. Funds realised from the sale of the F Street property were applied to the purchase of a unit in a retirement home in H, with the balance invested on term deposit and held in savings accounts.
10. T was informed of this state of affairs by T’s then solicitors [redacted], on 14 June 2011.2 T had sought [previous solictors’] advice regarding T’s wish to transfer $100,000 to each of the K Siblings. [Redacted] provided T with advice on that issue in their letter dated 14 June 2011.
11. Further to [redacted] advice, T transferred $100,000 to each of the K Siblings from funds traceable out of the sale of F Lane.
12. Funds traceable out of the sale of F Lane were used by T to purchase a unit in the W G retirement village at a cost of $336,000.
13. T later disposed of his interest in the W G retirement village for $231,000, realising a loss of $105,000 on the sale.
14. Approximately $300,000, being the balance of the funds realised from the sale of F Lane, was invested on term deposit and kept in savings accounts. These funds were transferred by T to the Trust.3

15. Pursuant to a sale and purchase agreement dated 7 August 2017, a residential property at 1/25 O Road, B (the Property) was purchased in the name of NK, as nominator.4 A deed of nomination was entered into on 21 September 2017 whereby NK nominated the trustees of the N Family Trust (N’s family trust) and the Trust as the purchasers of the Property, with the N Trust holding a one-third share and the Trust holding a two-thirds share.
16. T resided at the Property until February 2020, when he went into full-time residential care at the S H residential care facility after a short period of respite care at a H rest home.
17. In late February 2020, the K Siblings engaged the Practitioner to assist them to apply for a government subsidy to help pay for their father’s residential care (the Subsidy Application), and also to assist in bringing the Trust documentation up to date.
18. The Practitioner held an initial meeting with K and J K on Friday 28 February 2020.5 During the course of that attendance, the Practitioner, K and J discussed the K siblings’ understanding of their father’s and the Trust’s financial position, and the application for the Subsidy Application.
19. During that attendance, the K Siblings informed the Practitioner of the financial strain associated with T requiring residential care in advance of the subsidy being accessible.
20. The Practitioner agreed to provide the K Siblings with his proposal for addressing the issues discussed during the meeting, including bringing the Trust documents into order.
21. On 3 March 2020, the Practitioner was provided with information related to the invested funds forming part of the assets of the Trust.6
22. By email dated 3 March 2020, KK thanked the Practitioner for taking the time to meet, and advised the K Siblings looked forward to receiving the Practitioner’s proposal.7 In the email he stated that he and J had only recently learned that his father had very little money available as most of it had been used by N to renovate the Property.
23. In a letter to the K Siblings dated 9 March 2020, the Practitioner conveyed his understanding of the K Siblings’ financial position and his proposal in respect of their father’s assets and the Subsidy Application.8
24. By email dated 12 March 2020, KK, acting on behalf of the K Siblings, instructed the Practitioner to proceed with implementing the proposal outlined in the Practitioner’s letter of 9 March 2020, and to attend to the retirement of T as a Trustee and the appointment of J and N as trustees of the Trust.9
25. On 14 March 2020, the Practitioner emailed KK advising that he had prepared a deed of retirement, to be signed by T, and arranging a meeting for the following week.10
26. Between 13 and 18 March 2020, the Practitioner prepared draft authority and instruction (A&I) forms and land transfer statements.
27. The Practitioner met with T and the K Siblings at the S H retirement village on 18 March 2020.11
28. During the course of that attendance T and the K Siblings executed a deed by which T retired as trustee of the Trust and J and N were appointed as trustees of the Trust.12
29. In response to requests from the Practitioner, on 19 and 20 March 2020 N and K provided the Practitioner with further information and documentation relevant to the Trust’s and their father’s financial affairs, additional to that provided up to that point in time.13 In relation to the outstanding information requested, N and K confirmed that this could not be found.14
30. Between 20 March 2020 and 25 April 2020, the Practitioner prepared documents detailing distributions from and settlements on the Trust, and loans, advances and funds provided by T personally, between 2011and 2020.15 These included financial statements, trust deeds, trust year books, resolutions, and deeds of acknowledgment of debt. The Practitioner charged the K Siblings legal fees for the preparation of these documents.16

31. On 25 April 2020, the Practitioner emailed K, recording his conclusions as to the financial position of T and the Trust, and attaching twelve documents that he had prepared in order to document the flow of monies available to subsequent to the sale of the F Street property.
32. Included among these documents was a document entitled “Deed of Acknowledgement of Debt for $515,000” dated 7 August 2017.17 The parties to the deed are recorded as having been T and K as trustees of the Trust, and N as borrower. This was not executed.
33. On 30 April 2020, KK acknowledged the Practitioner’s email of 25 April 2020, apologising for not having earlier acknowledged the Practitioner’s email.18
34. On 11 May 2020, N telephoned and emailed the Practitioner regarding the refinancing of her mortgage over the Property, which was due for settlement on 14 May 2020. N informed the Practitioner that she had engaged the services of solicitor, [redacted] of [redacted], to carry out the refinancing exercise. To assist with that process, N asked the Practitioner to provide [redacted] with copies of the signed documents evidencing the change of ownership of the Property. The documents had not been registered.
35. On 12 May 2020, N followed up with the Practitioner for the documents given the imminent settlement date, explaining that her solicitor wished to complete the change of ownership of the Property that day.
36. On 13 May 2020, the Practitioner emailed [redacted] advising her that he had attended to the change of trustees, providing [redacted] with copies of the deed of retirement and appointment of new trustees, together with the completed A&I form and taxation forms signed by the trustees.19 As noted above, the documentation had been signed, but not registered.
37. On 10 June 2020, the Practitioner emailed KK advising he had made amendments to the documents he had prepared to support the Subsidy Application, further to instructions obtained from K and N, and requesting K to confirm whether the proposed recording of the $515,000 transfer in connection with the purchase of the Property “would be acceptable”.20
38. On 12 June 2020, KK replied to the Practitioner’s email of 10 June 2020, stating that the Trust owned two-thirds of the Property and a second trust (“N’s family trust”, the N Trust) owned the remaining one-third and that there was no loans or finance between them.21
39. On 19 June 2020, the Practitioner replied to KK’s email of 12 June 2020, answering the queries set out in KK’s email of 12June 2020.22
40. On 26 June 2020, the Practitioner replied to KK’s email of 22 June 2020,23 addressing comments made by KK in that email, and requesting that he “agree on an approach”.24
41. On 29 June 2020, KK emailed the Practitioner in response.25
42. On 1 July 2020, the Practitioner emailed KK, providing a copy of the Subsidy Application, providing advice on the completion of the application, and requesting that K complete and sign the application form, have the deed of loan for $515,000 signed, and provide additional information to support the Subsidy Application.26
43. On 16 July 2020, the Practitioner emailed KK, requesting an update on the K Siblings’ progress.27
44. On 23 September 2020, the Practitioner emailed KK, requesting an update on the K Siblings’ progress on the Subsidy Application.28
45. On 25 September 2020, KK emailed the Practitioner, stating that the K Siblings had sent the Subsidy Application to the Ministry of Social Development and said “think we’ll be okay looking after it ourselves”.29 This email effectively served to terminate the Practitioner’s retainer.30
    

1 TGK Family Trust 10 September 2010 (Tab 1).

2. Letter from [redacted] 14 June 2011 (Tab 2); Enduring Power of Attorney 13 May 2011; Enduring Power of Attorney Property 13 May 2011 (Tabs 2.1 and 2.2).

3 Trust Document “Dad’s Figures” undated (Tab 3).

4 Agreement for Sale and Purchase 1/25 O Road, B 7 August 2017 (Tab 4).

5. File Note 29 February 2020 (Tab 5); Email from NK to KK and JK, and File Note 30 February 2020 (Tabs 5.1 and 5.2).

6 Trust Document Schedule of Investments, undated (Tab 6).

7 Email from KK to the Practitioner, 3 March 2020 (Tab 7).

8 Letter from the Practitioner to the Trustees, 9 March 2020 (Tab 8).

9 Email from KK to the Practitioner, 12 March 2020 (Tab 9).

10 Email from the Practitioner to KK, 14 March 2020 (Tab 10).

11 Email from KK to the Practitioner, 16 March 2020 (Tab 11).

12 Deed for Retirement and Appointment of Trustee, 18 March 2020 (Tab 12).

13 Email from NK and KK to the Practitioner 19 March 2020 (Tab 13).

14 Email from KK to the Practitioner 20 March 2023 (Tab 14).

15. Deed to Appoint Beneficiary and Distribution of Trust Funds; Management of a Family Trust 18 March 2023; Tax Details 18 March 2020; File Note 18 March 2020 (Tabs 15-15.5).

16 Invoice, 24 April 2020; File Note Cost of Work Done (Tabs 16 and 16.1).

17 Deed of Acknowledgement of Debt, 17 August 2017, not signed (Tab 17).

18. Email from the Practitioner to KK, 25 April 2020; Email from KK to the Practitioner, 30 April 2020 (Tabs 18 and 18.1).

19 A&I Forms and Tax Statements Forms, May 2020 (Tabs 19 to 19.6).

20 Email from the Practitioner to KK, 10 June 2020 (Tab 20).

21 Email from KK to the Practitioner, 12 June 2020 (Tab 21).

22 Email from the Practitioner to KK, 19 June 2020 (Tab 22).

23 Email from KK to the Practitioner, 22 June 2020 (Tab 23).

24 Email from the Practitioner to KK, 26 June 2020 (Tab 24).

25 Email from KK to the Practitioner, 29 June 2020 (Tab 24).

26. Email from the Practitioner to KK, 1 July 2020; Residential Care Subsidy Needs Assessment Certificate; Residential Care Subsidy Financial Means Form (Tabs 25, 25.1, 25.2).

27 Email from the Practitioner to KK, 16 July 2020 (Tab 26).

28 Email from the Practitioner to KK, 23 September 2020 (Tab 27).

29 Email from KK to the Practitioner, 25 September 2020 (Tab 28).

30 Trustee Details 2 October 2020 (Tab 29).