NP v AO [2018] NZLCRO 39 (21 May 2018)

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	LCRO 122/2015
CONCERNING	an application for review pursuant to section 193 of the Lawyers and Conveyancers Act 2006
AND
CONCERNING	a determination of the [City] Standards Committee [X]
BETWEEN	NP Applicant
AND	AO _Respondent

The names and identifying details of the parties in this decision have been changed.

[1] Mrs NP has applied for a review of a decision by the [City] Standards Committee [X] (the Committee) to take no further action in respect of her complaint concerning conduct on the part of Mr AO.

[2] Mr AO acted for Ms T. Ms T was Mrs NP’s sister. Ms T executed a will appointing Mr AO as her sole executor and trustee, and naming two cousins as the only beneficiaries. Mrs NP and her siblings were not named as beneficiaries.

[3] The will came into effect when Ms T passed away in September 2014. By December 2014, although Mrs NP and her siblings had instructed a lawyer in Australia, no claims had been made against Ms T’s estate. Mr AO filed for probate and that was

granted by the High Court on 10 December 2014. He provided a copy of the will to Mrs

[4] Mrs NP objected to Mr AO’s involvement in drafting the will and taking steps as executor in the estate. She made a complaint to the New Zealand Law Society (NZLS) about Mr AO’s conduct.

... wouldn’t phone or make contact with us or our solicitor Mr MB. He only made contact with our Australian solicitor after Mr HF (our New Zealand solicitor) advised him to do so.

Reimbursement by Mr AO for legal fees incured [sic], unnecessarily due to his unprofessional conduct by not responding to several requests by our Australian solicitor in a timely manner.

letter dated 13 March 2015 signed on behalf of her siblings “Mr BG, Mr LG and Ms UG”.

[8] Mrs NP says that, together with her husband and brother Mr BG, she had met with Mr AO on 1 October 2014. He refused to provide them with a copy of Ms T’s will on the basis “it had not been cleared by the Court, and therefore he was not permitted to do so”. He told them that there was no provision in the will for “any beneficiaries either in New Zealand or Australia”. They discussed Ms T’s house and contents, and checked with Mr AO that the place was still insured.

[9] Mrs NP says “by happenstance” Mr BG met Mr AO in [Z Street] and that Mr BG reported Mr AO having told him “not to engage an independent solicitor as they cost a lot of money”.

[10] She and others met Mr AO at Ms T’s home later that day, obtained a key from the neighbour, and undertook “a brief perusal of her effects”.

[11] Mrs NP says that when she asked Mr AO later for further information to assist her and her siblings in Australia in possibly making a claim, he did not respond and continued not to return her calls.

[12] Mrs NP and her siblings engaged a lawyer who corresponded with Mr AO in October 2014. Mr AO did not provide a substantive response, but did say he was seeking advice on his position. Mrs NP and her siblings appear to have taken no formal steps to protect any interests they may have wished to claim. Without advising Mrs NP or her lawyer, Mr AO applied for and was granted probate in December 2014. When Mrs NP found out Mr AO had obtained probate, she was concerned that he had gone ahead despite her expressing serious concerns about his role in drafting the will. She raised concerns that Mr AO:

(b) failed to provide her and her siblings with information in a timely manner; (c) failed to respond to her reasonable requests as next of kin for further

[13] Mrs NP’s complaint was referred to the NZLS Early Intervention Process (EIP). Mr AO was advised of Mrs NP’s complaint and his conversation is recorded in the EIP file note as follows:

... he was under some pressure to produce will but she and brother not beneficiaries, think they may intend to make an estate claim, since referred file now to [JE], gave copy of will when probate granted, SC minded to NFA the matter, only concern is allegation that he said to brother that not to go get independent lawyer, he definitely not say this, that wrong, ok, he happy for SC to deal with but let him know if need any further info, he will provide

[14] The Committee decided to take no further action for the reasons set out in the decision. Mrs NP was not satisfied and applied for a review.

[15] In her application for review Mrs NP says the Committee did not address all of her complaints. She says she complained that Mr AO:

(a) failed to handle the management of the will and estate in a professional manner;

(b) failed to provide her with information about Ms T’s will in a timely manner;

(c) failed to respond to her requests in her capacity as next of kin for further information to assist her and her siblings in making claims against the estate;

(e) provided inappropriate and unsolicited advice to her brother, Mr BG “not to get independent legal advice”.

[16] Reserving her right to take further action against Mr AO, Mrs NP says that:

If your investigations substantiate either negligent or wilful or mischievous conduct that would constitute non-professional behaviour by Mr AO, then appropriate action be taken in accordance with New Zealand legal profession standards and regulations.

[17] In her supporting letter, Mrs NP says Mr AO’s delay in providing a copy of the will meant there was no chance for her or her siblings to make representations as next of kin to the Family Court and they were left with the High Court process as their only avenue for challenging the will. Mrs NP enclosed several statutory declarations. The declaration from Mr BG, taken on 12 June 2015, relies on his diary note from 11 October

2014 when he met Mr AO on the street. Mr BG says Mr AO told him “not to engage lawyers as they cost a lot of money”. Mrs NP’s declaration of 16 June 2015 confirms that is what Mr BG told her and her husband immediately after Mr BG and Mr AO had met. Mr NP confirms his recollection that Mr AO “told/warned Mr BG words to the effect

‘not to engage lawyers as they cost a lot of money’”, by declaration dated 16 June 2015.

[18] Mrs NP believes Mr AO should have told her Australian solicitor immediately that he was not required to provide the will to non-beneficiaries under New Zealand law and that Mr AO did not respond to repeated requests for information before obtaining probate. Mrs NP asked the Law Society to notify Mr AO of the complaint as a matter of urgency, apparently in the hope it would deter distribution of the estate, as had been indicated, on 19 June 2015.

1 October 2014] I said immediately they were not beneficiaries in the will, that they should go and get their own independent legal advice....They asked me for a copy of the will but I said I could not give them a copy of the will until probate had been granted.

[20] Mr AO notes that Mrs NP had instructed a lawyer in Australia by mid-October

2014 and that he had been served with a claim by Mrs NP under the Law Reform (Testamentary Promises) Act 1949, there being no basis for a Family Protection Act 1955 claim. Mr AO attached a statement signed by Mr W, a solicitor from whom Mr AO sought advice, confirming that on 30 September 2014 (the day before he met with Mrs NP, her husband and Mr BG) they had discussed the position. Mr W’s advice to Mr AO was that he “should not give the brothers and sisters a copy of the will as they were not beneficiaries and that he should tell them that they should take independent advice”.

[21] Mrs NP notes that Mr AO has provided no contemporaneous file note of the meeting at his office including reference to him telling them to obtain their own independent legal advice.

[22] Mrs NP accepts Mr AO was not obliged to provide details of the will at that stage and says her understanding was that she would have to wait until the will was lodged for probate, rather than probate granted. Mrs NP is critical of Mr AO for not having substantiated his response to her application for review by producing his file records and says she and her siblings had by that stage lodged a claim against Ms T’s estate in the High Court.

[23] Mrs NP highlights her concern that, other than making a phone call, Mr AO “repeatedly ignored” her lawyers’ letters, did not disclose the content of the legal advice he had received and “did not even write to acknowledge receipt of emails and correspondence, until after probate was granted on 10th December 2014”. She contends the application for probate should have been “in ‘Solemn’ format, rather than the ‘without notice common form procedure’” that was used. Mrs NP believes “next of kin” have some special status in the administration of estates.

[25] A direction was given to the parties the day before the review hearing, because Mrs NP had indicated she wanted her husband and Mr BG to give further evidence at the review hearing, but had also indicated they had nothing to add. It seems Mrs NP had not appreciated that the review could be determined on the papers without a hearing.

[27] Mr AO did not exercise his right to attend and the review was determined without further input from him.

[28] 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.

[29] 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.

[30] Mrs NP says the key areas of concern to her are Mr AO’s failure to respond to requests for advice from her and her lawyers in a timely manner, and telling Mr BG not to get independent legal advice. As the balance of the complaint does not raise professional standards issues, this review focuses on those two areas.

[31] Mr AO is a lawyer. He owes obligations first to the Court, second to his client. Any obligations he may owe to others, such as Mrs NP and her siblings, rank behind those obligations. Where interests conflict, Mr AO was obliged to favour his client’s over those of others. Mrs NP’s complaints must be viewed from that perspective. It is also relevant to note that after Ms T passed away, Mr AO was acting as Ms T’s executor and was obliged to act in accordance with his obligations in that regard as well as meeting his continuing obligations to his client. This Office exercises no jurisdiction over executors.

[32] Mr AO acted for Ms T. Among his many duties to Ms T, r 8 of the Lawyers and Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008 (the Rules) imposes a duty of confidence on Mr AO. Rule 8 obliged Mr AO to protect and hold in strict confidence all information concerning Ms T, his retainer with her, and her business and affairs that he acquired in the course of their professional relationship. That duty commenced at the time Ms T made any confidential disclosure to Mr AO and continued indefinitely.3 The duty of confidence passed to Mr AO because he was Ms T’s personal representative after her death.4

[33] As Mr AO was Ms T’s lawyer and her personal representative under her will, he was obliged to protect and hold information that was confidential to her. It bears noting that “confidential information” for the purposes of the rules is extremely broad. The footnote to r 8 says:

Information acquired in the course of the professional relationship that may be widely known or a matter of public record (such as the address of the client, criminal convictions or discharged bankruptcy) will nevertheless be confidential information.

3 Lawyers and Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008, r 8.1.

[34] Despite that, limited disclosure may be mandated by law, order of a court or by virtue of the lawyer’s duty to the court.5 A lawyer also has a level of discretion in disclosing confidential information to a third party where the client expressly or impliedly authorises the disclosure.

[36] It is also worth repeating that although Mr AO was a lawyer, his professional duties in that regard were overlaid by his obligations as executor of Ms T’s estate. As such he was not obliged to share the contents of the will with Mrs NP or her siblings and was obliged to “propound and maintain the will by which he had been appointed”.6 It would have been entirely contrary to his duties to Ms T to assist Mrs NP and her siblings in any way that could have thwarted Ms T’s wishes as she had expressed those to him.

[37] Mrs NP objects to Mr AO being uncooperative with her and her siblings’ attempts to advance their interests. Mr AO told them they were not beneficiaries under Ms T’s will. That was generous of him. If he was obliged to go that far, he was certainly not obliged to go further. The very fact they were not given or shown a copy of the will, or any benefit they may be entitled to from it, was itself notice they were not named as beneficiaries in it.

[38] Mrs NP says she and her siblings wanted to explore the potential for claims against Ms T’s estate and is critical of Mr AO for having done nothing to assist them. He did not respond to correspondence, he did not explain the New Zealand system to the Australian lawyer. All he really did was allow them to access Ms T’s home after she died and tell them they were not named in the will.

[39] Mr AO was obliged to advance the interests of his own client, Ms T’s estate. That was also consistent with his obligations as the executor named in her will.

[40] By excluding Mrs NP and her siblings from any beneficial interest by naming only other beneficiaries, it is clear that Ms T’s instructions to Mr AO were that she wanted only the named beneficiaries to benefit from her estate. It seems inherently unlikely that

_{Ms T might have completely overlooked the fact that she had other
siblings and could, if}

6 Nicky Richardson Nevill’s Law of Trust, Wills and Administration (10th ed, LexisNexis, [City],

she had wanted to, make provision for them in her will. It seems from the terms of her will that Ms T felt she had other priorities.

[41] Mr AO was not obliged to assist Mrs NP or her siblings to further their claims to an interest in Ms T’s estate, because those interests were in direct conflict with the wishes recorded by Ms T in her last will. Mr AO was not obliged to give advice to the Australian lawyer. Any uncertainty on the part of that lawyer could not be resolved by reference to what Mr AO might have to say about New Zealand law or Ms T’s will.

[42] Mr AO was generally obliged to respect and promote the estate’s interests. As Mrs NP should have been advised, there were other ways for her to challenge the will and perhaps also Mr AO’s position as its executor. This Office has no statutory jurisdiction over wills or executors. It would be an abuse of the complaint and review process to call them in aid as leverage to try and persuade a lawyer to act against the very interests that lawyers and executors are obliged to protect.

[43] For the purposes of the Rules, Mrs NP and her siblings were third parties. Rules

12 A lawyer must, when acting in a professional capacity, conduct dealings with others, including self-represented persons, with integrity, respect, and courtesy.

12.1 When a lawyer knows that a person is self-represented, the lawyer should normally inform that person of the right to take legal advice.

[44] Those obligations must be viewed against the background of all the overriding obligations Mr AO owed to the court, to Ms T and to her estate.

[45] The greatest concern Mrs NP expresses is that Mr AO did not tell her or Mr BG at their formal meeting that they should obtain independent legal advice. Moreover, Mr BG says Mr AO told or warned him in the street after the meeting “not to engage lawyers as they cost a lot of money”.

[46] Lawyers are generally encouraged by r 12.1 to tell self-represented persons they have a right to take legal advice. It is not an absolute obligation, but is normally expected. Sometimes the lawyer is relieved of the obligation. Examples might include occasions when it is clear to the lawyer that the person concerned is already aware of the right to take legal advice, or where that information would otherwise be entirely superfluous.

[47] Mr AO’s position is that he complied with r 12.1 by giving Mrs NP and Mr BG

[48] Mrs NP’s position is that he did not comply with r 12.1, and furthermore, he tried to discourage Mr BG (at least) from exercising the right to legal advice. The latter would demonstrate disrespect for a person’s right to take legal advice and would probably constitute a contravention of r 12.

[49] The conflict of evidence is irreconcilable. Conflicts of evidence on review are to be resolved with reference to the civil method of balancing probabilities in order to form a view on which version of events is the more likely.

[50] Taking the alleged comments to Mr BG on the street first, Mr AO does not dispute having met with Mr BG on the street. His position is that he did not say what Mr BG believes he heard.

[51] There are two parts to Mr BG’s evidence. First, he says Mr AO told or warned him not to engage lawyers. From a lawyer in the circumstances, a warning or any other kind of discouragement, would be improper.

[52] The second aspect of Mr BG’s evidence is that Mr AO told or warned him that lawyers would be expensive. While that could be taken as a warning or a caution, it is really no more than a fact. Estate claims generally are expensive to pursue. They almost invariably deplete the estate concerned, and come at a cost to all those involved. It would be very unusual for an estate claim not to come at some cost to those who, like Mrs NP and Mr BG, might raise challenge to the will.

[53] It is also relevant to note that Mr BG’s evidence at the review hearing was that there was absolutely no broader conversation between him and Mr AO on the street. The picture Mr BG’s evidence paints is that of Mr AO walking up to him on the street, Burger King in hand, forbidding Mr BG from getting a lawyer under threat of costs and marching on.

[54] At the review hearing Mrs NP gave her impressions of Mr AO. She described his demeanour at their meeting in his offices as friendly, non-aggressive, nervous and insecure. She says he is quietly spoken.

[55] That description does not tie in at all with the picture Mr BG’s evidence paints

[56] It is not always the case that people correctly recall or interpret what they were told at the time, or even shortly after hearing it. Recollections are affected by many factors, including emotions, which Mr BG and Mrs NP both say were running high for them. That is understandable. They had just lost their sister, an event of significance in their lives. Recollections can also become far more significant as time goes by.

[57] It is accepted that Mr BG accurately recorded in his diary at the time what he understood Mr AO had told him. It is not accepted that Mr AO deliberately tried to deter Mr BG from getting a lawyer by warning him about cost or otherwise. If a person wants to exercise the right to take legal advice, in the majority of cases, there will be a cost. Even if Mr BG was not aware before this interaction that he could take legal advice, he knew then. It is sometimes the case that lawyers are unaware of the power they have over others simply by dint of holding the status of lawyer. That does not mean there is a sound basis for a finding that Mr AO sought to deter him from instructing a lawyer.

[58] It is noted that Mrs NP and her siblings commenced proceedings against the estate. They say Mr AO was present throughout the court hearing at which their claims against the estate were determined by the court on the basis of evidence. It is understood that Mr AO handed his file over to independent lawyers fairly soon after probate was granted and that the estate was separately represented. It is therefore assumed that any issue Mrs NP, any of her siblings, or the estate may have had with Mr AO’s involvement at or about the time of Ms T’s death could have been explored in evidence, under cross-examination if necessary, at that hearing. If that opportunity was not pursued, it has now passed. The process of review is an inquisitorial process and not well suited to an adversarial approach.

[59] On review, the conflict of evidence is resolved on the basis that Mr BG either misheard or misunderstood what Mr AO said to him.

[60] The other conflict of evidence as to whether or not Mr AO told Mr BG and Mrs NP in the course of the meeting that they had a right to take legal advice also cannot be resolved other than with reference to the balance of probabilities.

[61] The meeting took place at Mr AO’s office. Mr AO knew the people coming to see him wanted to talk about Ms T and her will. He knew those people were not named as beneficiaries. He was concerned enough about the position to have contacted Mr W, a solicitor, the day before he met with Mrs NP and the others, and had asked for his advice. It is not beyond credibility to suggest Mr AO had not been confronted with a similar situation before. If that is the case, seeking guidance was prudent, sensible and

professional. The advice he got was that he “should not give the brothers and sisters a copy of the will as they were not beneficiaries and that he should tell them that they should take independent legal advice”.

[62] Clearly Mr AO was alert to the risk of conflict of interest, knew full well he could not advise Mrs NP or Mr BG and that if they were to take advice, it would need to be from someone independent.

[63] Mrs NP says he came across at the meeting as very nervous, clutching his very slender file and saying he could not tell them what was in it.

[64] Mr AO says he was aware of his obligations and told Mrs NP and Mr BG they could get a lawyer.

[65] Although Mrs NP and the others genuinely believe Mr AO did not tell them to get independent legal advice, within a couple of weeks of seeing him Mrs NP had instructed a lawyer. Mrs NP’s evidence is to the effect that she instructed her own lawyer because Mr AO was being so unhelpful and uncooperative.

[66] Mrs NP’s expectations of Mr AO were misplaced. There was no basis on which to assume Mr AO might have been working for Mrs NP or her siblings. He gave every indication he was not. The expectation that he should have responded was misplaced. That expectation seems to have been based on an assumption that lawyers’ conduct is measured by the same standards as that of ordinary citizens. That is not correct. As the authors of Ethics, Professional Responsibility and the Lawyer say:7

Lawyers, however, are frequently permitted, and occasionally required, to act in a manner that contradicts the normal expectations of ethical conduct... they must keep a client’s confidence to the detriment of other parties in all but the most exceptional cases. The professional rules of lawyers demand they act in a way which in normal life would be considered wrong.... The role of a lawyer then is strongly differentiated in the sense that there is a strong divide between the conduct except expected of them as lawyers and the conduct expected of them as ordinary citizens.

[67] Mr AO conduct as a lawyer was overlaid by his obligations as Ms T’s executor.

[68] It is not accepted that Mr AO should have given any more than he did by way of response to Mrs NP’s lawyer. It is also not accepted that Mr AO did not give Mrs NP

7 Duncan Webb, Kathryn Dalziel and Kerry Cook Ethics, Professional Responsibility and the

and Mr BG every indication that they had a right to take legal advice from someone other than him.

(a) met his obligation to tell Mrs NP and Mr BG they had a right to take legal advice, from someone other than him; and

[71] Although it is set out in a different way, the above expands on and is generally consistent with the Committee’s reasoning. There is no proper basis on which to conclude that Mr AO breached his professional obligations to Mrs NP or Mr BG, and therefore no reason to modify or reverse the Committee’s decision. That is confirmed.

In accordance with s 213 of the Lawyers and Conveyancers Act 2006 copies of this decision are to be provided to:

New Zealand Legal Complaints Review Officer

NP v AO [2018] NZLCRO 39 (21 May 2018)