New Zealand Law Society - Fined for intimate relationship with client

Fined for intimate relationship with client

Published on 3 April 2020

[All names are fictitious.]

A lawyer who entered into an intimate relationship with a client, and continued to act, has been fined $4,000 by a lawyers standards committee.

The lawyer, Banffshire, was acting for the client, Mr T, in respect of legal issues arising from his separation from his former partner. The nature of the relationship between Banffshire and Mr T evolved over the course of the retainer.

On 27 January 2019, while Banffshire was still acting for Mr T, the pair dined together with friends. Banffshire described this as a first public ‘date’. It followed a meeting with Mr T where Banffshire had noticed a change in the ‘chemistry’ of their relationship.

Banffshire said she and Mr T believed the dinner would be a safe measuring stick to ascertain whether the “chemistry was anything other than flirting”. Banffshire pointed out that a first date may result in nothing more being pursued or, alternatively, an agreement to see each other again.

In late January, Banffshire and Mr T agreed that a referral to new counsel should be made, given the ongoing change in the nature of their relationship.

In early February, apparently as an interim measure, Mr T’s matter was passed to a lawyer employed by Banffshire’s firm and under Banffshire’s direct supervision.

The next day, Mr T was referred to another firm, and the retainer with Banffshire’s firm was terminated.

Banffshire accepted that she and Mr T were now in a relationship.

Rule 5.7

Rule 5.7 of the Lawyers and Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008 (RCCC) states that “a lawyer must not enter into an intimate personal relationship with a client where to do so would or could be inconsistent with the trust and confidence reposed by the client”.

Rule 5.7.1 states that “a lawyer must not enter into an intimate personal relationship with a client where the lawyer is representing the client in any domestic relations matter.”

The standards committee said that it was “extremely unwise for [Banffshire] to go on a date with any client, let alone a client she was acting for in respect of a domestic relations matter.

“While it is not unheard of for a lawyer and client to go for a celebratory drink at the resolution of a longstanding matter, the pub dinner did not fall into this category.

“The reality is that [Banffshire], by her own admission, knew from at least as early as 14 January 2019, and from subsequent discussions with Mr [T], that there was a romantic interest.

“[Banffshire] made a conscious decision to go on a date with Mr [T] despite the risk that this would compromise the lawyer-client relationship and result in a breach of the RCCC,” the committee said.

It was “simply untenable” for Banffshire to continue to act in the matter yet the retainer was not terminated until 12 February 2019.

Rationale for rules

The committee reflected on the rationale for Rules 5.7 and 5.7.1, which are found within Chapter 5 of the RCCC, the heading of which is “Independence”.

It considered that “the decision to place Rules 5.7 and 5.7.1 within Chapter 5 is not coincidental. “It is clearly intended to be a reflection of the fact that a lawyer who enters into an intimate personal relationship with their client may become compromised in their ability to exercise independent judgement in relation to their client’s affairs”.

The committee observed that there can be a high level of acrimony between parties to family law disputes. “A lawyer who is emotionally-invested in a client’s matter may lose their objectivity. This may adversely impact on the lawyer’s representation of the client, and even exacerbate pre-existing conflict” the committee said.

Banffshire’s continued representation of Mr T until 12 February “created a very real public perception issue that risked bring the legal profession into disrepute,” the committee said.

The committee considered that by acting for Mr T between 29 January and 12 February 2019, Banffshire was in breach of rules 5.7 and 5.7.1, and that was unsatisfactory conduct. As well as fining Banffshire $4,000, the committee ordered her to pay $1,000 costs.