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Fined for significant delays and acting where there was a conflict

25 November 2014

A lawyers standards committee has fined a lawyer, E, $1,500 for significant delays in providing information about an estate to a beneficiary of the estate.

The committee also fined E $2,000 for acting for both the estate and the estate administrator in her personal capacity when there was a conflict of interest.

E acted for the estate of a man who had operated a franchise taxi business and who died intestate. The deceased was survived by his widow and his daughter. The widow was the administrator of the estate. The daughter had instructed her own lawyers from another firm.

Despite a number of requests through her lawyers, the daughter was not provided with a summary of the assets and liabilities of the estate until after the statutory 12 months within which she could have made a Family Protection claim.

The deceased had died in April 2011. The daughter’s lawyers contacted E at the beginning of June advising the daughter was a beneficiary. They asked as to when a will enquiry would be published. They did not receive a reply and asked for the information again later in June, then in July.

E did not respond until August. He confirmed that no will had been located at that time. He advised he was making enquiries as to the extent of the assets and liabilities of the estate, and would update them in due course.

In November the lawyers for the daughter wrote again, requesting a draft statement of assets and liabilities. E wrote back saying he was “hamstrung” because the coroner’s inquiry had not been completed and therefore a death certificate could not be obtained, something the insurance companies required.

Further requests for a draft statement of assets and liabilities were made by the daughter’s lawyers in December and early February 2012

E eventually responded on 20 February 2012, saying the sale of the deceased’s taxi had yet to be finalised and indicated that once that matter was settled, he would be able to bring the estate’s accounts up to date and would be in touch at that stage.

The daughter’s lawyers made further requests for a statement of the assets and liabilities in April, May, August, October and November 2012. Finally on 6 December 2012, when it was indicated that a complaint would be made to the Law Society, E responded that same day with the requested details.

In explanation E noted that though the estate was modest, it was not straightforward. There had been issues with the coroner’s office, the death certificate, insurance companies and the deceased’s bank. The deceased’s franchise business had complicated matters. The administrator had also had periods of ill health.

E said that reconciling the accounts was a task that needed concentrated attention. He said he had unfortunately kept putting it to one side in the face of more pressing matters. He said that though it was tardy, he did not consider the delay was undue, and was not intentional, and the administrator had not complained of the delay.

The committee found, however, that there were significant delays on E’s part, and determined that his conduct was unsatisfactory.

The daughter had also complained about a number of other matters, including the fact that there was a conflict of interest in E acting for both the estate and the widow (the administrator) in her personal capacity.

E said that the widow had declined to seek independent legal advice on her personal entitlements.

The committee said, however, that a conflict “clearly arose” by virtue of E advising [the widow] in her capacity as both administrator and as a beneficiary of the estate.

“The fact that [the widow] declined to seek independent advice in respect of her personal entitlements does not justify [E] continuing to act for her in that capacity. Neither does the simple fact that [the widow] did not, in the event, bring a claim under the Family Protection Act [1955] obviate the conflict that had arisen,” the committee said.

As well as the fines, the committee ordered E to pay the daughter $1,200 towards her legal costs. E was also ordered to pay the Law Society $1,000 costs.

Last updated on the 3rd June 2015