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Fined for a series of offences

16 March 2015

A lawyer, E, has been censured and fined $1,500 by a lawyers standards committee for a series of offences incurred while acting on a right of way matter.

In 2003 Mr and Mrs F granted a right of way over their land in favour of Mr G. A written easement agreement was entered into which provided that Mr G would meet the costs of the right of way.

Nothing appeared to have been done to advance the formalisation of the right of way until August 2010, when E registered a caveat over Mr and Mrs F’s property to protect the right of way. He did this on Mr G’s behalf.

In March 2013, Mr and Mrs F consulted E’s law partner about the sale of part of their land to their son. Within days of giving instructions to the firm, E started working on the file, along with the other partner.

E proceeded with the sale and purchase transaction when, on 23 April 2103, he formally sought Mr G’s consent as caveator to the transfer of the land from Mr and Mrs F to their son.

“It would seem that until that point [E] believed [Mr G] to still be his client and that his consent to the transfer wouldn’t be an issue,” the standards committee noted.

Mr G sought separate legal advice, which resulted in caveator’s consent being conditional on: (a) the purchaser giving Mr G a limited power of attorney to complete the right of way easement; and (b) Mr and Mrs F paying all the costs of the right of way, with Mr G contributing $2,500.

Mr and Mrs F objected to the conditions Mr G imposed on giving his consent. Further communications followed but Mr and Mrs F and Mr G were unable to resolve the impasse, so the transfer of land to the son did not proceed.

The standards committee said it assumed that was still the position, with Mr G’s right of way secured by caveat.

E was aware that Mr G’s consent would be required to allow Mr and Mrs F to transfer the land to their son, the committee said.

E should have ensured Mr G’s consent was certain before engaging in the work he did. The time records show that about 11 hours of work was done by the time caveator’s consent was sought. Had E ascertained Mr G’s position on the transfer much earlier, the bulk of this work would not have occurred.

“In that, [E] did not act competently,” the committee said, and Mr and Mrs F “should not pay for that”.

The committee ordered that one of E’s fees be reduced by $3,236.08 to $2,006.61, and another fee of $2,049.42 be cancelled.

There was nothing to suggest that the second invoice should have been rendered to Mr and Mrs F, and the committee directed E to issue it to the son and issue a credit note to Mr and Mrs F.

The committee also noted that E’s firm represented Mr and Mrs F and Mr G at the same time and relating to the same transaction, and that it created a conflict of interest.

E acknowledged that he did not send Mr and Mrs F a letter of engagement. That created “real difficulties” for Mr and Mrs F and the committee in dealing with the complaint, the committee said.

“So, too, did the state of [E]’s files provided to the committee for the purpose of this investigation.

“The failure to send an engagement letter to [Mr and Mrs F] prevents [E], in these circumstances, to charge interest on the unpaid account,” the committee said.

It noted that E was not responsible for Mr G’s failure to formalise his right of way easement from 2003 nor for Mr G’s conditions of consent to the transfer in 2013.

Mr and Mrs F also complained that E had declined to release files, leading to them suffering loss. However, no loss was proved and the committee did not consider any further action was necessary.

As well as the censure, fine, reduction of one fee and cancellation of another, E was ordered to pay the Law Society $1,000 costs.

Last updated on the 17th August 2015