|
|
Home
| Databases
| WorldLII
| Search
| Feedback
New Zealand Legal Complaints Review Officer |
Last Updated: 17 May 2018
|
|
LCRO 16/2018
|
|
CONCERNING
|
an application for review pursuant to section 193 of the Lawyers and
Conveyancers Act 2006
|
|
AND
|
|
|
CONCERNING
|
a determination of the [Area] Standards Committee [X]
|
|
BETWEEN
|
AD
Applicant
|
|
AND
|
LN
Respondent
|
The names and identifying details of the parties in this decision have been changed.
Introduction
[1] Mr AD has applied for a review of a decision by the [Area] Standards Committee
[X] (the Committee) to take no further action in respect of his complaint concerning Mr LN’s conduct in acting for Mr AD’s former wife, Mrs AD.
Background
[2] The background is set out in the Committee’s decision. It is not necessary to repeat that here.
[3] The nub of Mr AD’s complaint and application for review is that Mr LN acted in a manner that was inconsistent with Orders made by the Family Court determining the division of their relationship property by consent. The orders relevantly said:
...
[4] Mr AD says he never intended the family home would be sold to a third party without the process that begins at clause 6 of the orders being followed. Mr AD’s position is that Mrs AD never became the registered proprietor of the family home. He says that although he received $115,000 in full and final settlement of all outstanding relationship property matters between him and his former wife, she did not borrow the money or pay it to him. Mr AD believes Mr LN assisted Mrs AD to circumvent the process set out in the Orders, by enabling the AD’s daughter and son-in-law to pay him out using a loan they had obtained from [Bank B] and using the family home as security. Mr AD considers Mr LN acted deceitfully, and misled him and his lawyer into believing Mrs AD had raised finance from [Bank B].
[5] Mr LN denies any professional wrongdoing.
Standards Committee decision
[6] The Committee considered whether Mr LN’s conduct fell short of the standard of competence and diligence a member of the public is entitled to expect of a reasonably competent lawyer, and referred to r 11.1 of the Lawyers and Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008 (the Rules), which prohibits a lawyer from engaging in conduct that is misleading or deceptive or likely to mislead or deceive anyone on any aspect of the lawyer’s practice.
[7] The Committee noted that Mr AD had received “exactly what he anticipated and agreed to under clause 1 of the order, namely $115,000 in full and final settlement”. It observed that Mr LN was acting for Mrs AD, not Mr AD, and therefore owed him only very limited obligations. The Committee also noted that Mr AD had indicated he intended to bring the matter back before [Judge] in the Family Court, observing that was the appropriate course if he had concerns.
[8] The Committee decided further action was not necessary or appropriate.
Application for review
[9] Mr AD was not satisfied, and applied for a review on the basis that the Committee had erred and Mr LN had clearly breached professional standards.
Review hearing
[10] Mr AD attended a review hearing by telephone on 11 April 2018 with Ms TH as his support person and lay representative. Mr LN was not required to attend and did not exercise his right to do so.
Nature and scope of review
[11] The nature and scope of a review have been discussed by the High Court, which said of the process of review under the Act:1
... the power of review conferred upon Review Officers is not appropriately equated with a general appeal. The obligations and powers of the Review Officer as described in the Act create a very particular statutory process.
The Review Officer has broad powers to conduct his or her own investigations including the power to exercise for that purpose all the powers of a Standards Committee or an investigator and seek and receive evidence. These powers extend to “any review” ...
... the power of review is much broader than an appeal. It gives the Review Officer discretion as to the approach to be taken on any particular review as to the extent of the investigations necessary to conduct that review, and therefore clearly contemplates the Review Officer reaching his or her own view on the evidence before her. Nevertheless, as the Guidelines properly recognise, where the review is of the exercise of a discretion, it is appropriate for the Review Officer to exercise some particular caution before substituting his or her own judgment without good reason.
1 Deliu v Hong [2012] NZHC 158, [2012] NZAR 209 at [39]–[41].
[12] More recently, the High Court has described a review by this Office in the following way:2
A review by the LCRO is neither a judicial review nor an appeal. Those seeking a review of a Committee determination are entitled to a review based on the LCRO’s own opinion rather than on deference to the view of the Committee. A review by the LCRO is informal, inquisitorial and robust. It involves the LCRO coming to his or her own view of the fairness of the substance and process of a Committee’s determination.
Discussion
[13] Rule 11.1 says that a lawyer must not engage in conduct that is misleading or deceptive or likely to mislead or deceive anyone on any aspect of the lawyer’s practice. It is a rule that correlates to the law around fair trading. As mentioned earlier, this complaint expresses concern that Mr LN was more economical with the truth than he should have been in assisting his client to conclude settlement pursuant to the Family Court’s orders, an issue of a different character.
Professional standards
[14] The Committee considered Mr LN’s conduct in the context of s 12(a) of the Lawyers and Conveyancers Act 2006 (the Act), which defines unsatisfactory conduct for the purposes of the Act as meaning:
(a) conduct of the lawyer... that occurs at a time when he... is providing regulated services and is conduct that falls short of the standard of competence and diligence that a member of the public is entitled to expect of a reasonably competent lawyer...
[15] Section 12(b) would be equally relevant, because it is unlikely that lawyers of good standing would regard misleading or deceptive conduct as acceptable in a lawyer.
[16] That said, the key concern for this Office is the suggestion that Mr LN may have acted in a manner that was inconsistent with an order of the court. Mr LN was, at the relevant times, “a person enrolled under or by virtue of [the] Act as a barrister and solicitor of the High Court”. Pursuant to s 268(1) of the Act, he was therefore subject to the “inherent jurisdiction and powers of the High Court”. As an officer of the court, Mr LN could not knowingly conduct himself in a way that may be inconsistent with orders made by the Family Court.
2 Deliu v Connell [2016] NZHC 361, [2016] NZAR 475 at [2].
[17] Mr AD believes Mr LN deliberately misled him into parting with his share in the family home on the basis that Mrs AD had obtained finance herself from [Bank B] to enable her to pay him out when [Bank B] did not lend her money.
[18] The court orders do not oblige Mrs AD to obtain finance from anyone in particular. Having reached agreement with Mr AD in the terms recorded in the order, it was Mrs AD’s choice how she raised the money she needed to pay Mr AD. As the orders do not limit the sources of funding that Mrs AD might avail herself of, there is no basis for any concern over who might provide her with the money. If anything, Mr LN provided more information than was strictly necessary by sharing the source of the finance with Mr AD and his lawyer. That should not be a concern for Mr AD.
[19] As to the contention that Mrs AD never became the owner of the former family home, that is simply wrong. The certificate of title records the order of events that followed Mr AD having signed the transfer, as he had agreed to do pursuant to clause 3 of the court order once Mrs AD’s finance had been confirmed.
[20] Mr AD signed the transfer on 8 May and Mr LN held that.
[21] With the mortgagee and charge holders’ consent, the mortgages and charging order were discharged from the title.
[22] The transfer Mr AD had signed on 8 May was registered, transferring his half share in the family home to Mrs AD.
[23] At that moment Mrs AD was the registered legal owner of both halves of what had formerly been the family home. The title on the Land Register was free from any registered legal encumbrances like mortgages and charging orders. While according to the Land Register it was all hers to do with as she chose, that was not Mrs AD’s reality.
[24] Mr LN says Mrs AD had reached an agreement with her daughter and son in law and recorded that in a Deed of Family Arrangement. It is assumed that the arrangement was contingent on Mr AD signing the transfer, the bank offering the borrowers terms and the borrowers accepting the terms on which the bank would lend. Mr AD was not a party to the Deed. He did not need to be. It did not affect him. His rights and obligations were recorded in the court orders.
[25] The Deed was not provided to the Committee and has not been provided on review. The terms of the Deed are private matters between its signatories, none of whom are parties to Mr AD’s complaint. There is no proper basis for this Office to disregard the privacy interests of those non-parties by requiring production of the Deed. Suffice to
say, it appears from the title on the Land Register that at least some of the arrangements recorded in the Deed were put into effect.
[26] It seems from the information shown on the title that the arrangements included the son and daughter in law taking the whole of the title from Mrs AD so they could use the former family home as security for a bank loan. Somehow enough money was released to enable Mrs AD to settle with Mr AD.
[27] There is no apparent inconsistency with the Court order, which is silent as to the source of any finance Mrs AD might obtain. The only suggestion that finance was coming from [Bank B] was in Mr LN’s email. He said more than was required. The court orders did not oblige him to disclose any details about Mrs AD’s finance, only that she had secured it, which she had.
[28] I agree with the Committee’s view that there is no basis on which to take further action in relation to Mr AD’s complaint.
[29] The Committee’s decision to take no further action is confirmed for the reasons set out above.
Decision
Pursuant to s 211(1)(a) of the Lawyers and Conveyancers Act 2006 the decision of the Standards Committee is confirmed.
DATED this 13th day of April 2018
D Thresher
Legal Complaints Review Officer
In accordance with s 213 of the Lawyers and Conveyancers Act 2006 copies of this decision are to be provided to:
Mr AD as the Applicant Mr LN as the Respondent
Mr H as the Related Person [Area] Standards Committee The New Zealand Law Society Secretary for Justice
NZLII:
Copyright Policy
|
Disclaimers
|
Privacy Policy
|
Feedback
URL: http://www.nzlii.org/nz/cases/NZLCRO/2018/31.html