Renewing a practicing certificate without disclosing that an application for bankruptcy had been served on him has resulted in a lawyer being ordered to pay a $3000 fine and costs of $1000. The standards committee noted that lawyers have an ongoing obligation to advise the New Zealand Law Society | Te Kahui Ture o Aotearoa of any matter which “might” affect their eligibility to hold a practising certificate. The committee reminded lawyers to take a precautionary approach by advising the Law Society of problems that might affect their practising certificate renewal.
The lawyer renewed his practising certificate without declaring the bankruptcy application, and adjudicated debt in respect of unpaid tax and GST, as he was confident that it would be set aside. The lawyer was subsequently adjudicated bankrupt.
The standards committee noted that lawyers have an ongoing obligation to advise the New Zealand Law Society | Te Kahui Ture o Aotearoa of any matter which “might” affect their eligibility to hold a practising certificate. This is not limited to the matters listed in ss 41 and 51 of the Lawyers and Conveyancers Act 2006.
The committee stated that the integrity of the system depends on practitioners being open and transparent and that “full, frank, and early disclosure of any and all matters” is required. There is also no need to wait for practicing certificate renewal to report matters of concern.
The committee determined that the lawyer had breached r 8 of the Lawyers and Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008, having failed to disclose matters that might affect his continuing ability to hold a practising certificate as soon as practicable.
Bankruptcy of itself does not prohibit a person from practising as a lawyer. However, the circumstances of a practitioner’s bankruptcy may involve misconduct or unsatisfactory conduct, or bring into question whether someone remains a fit and proper person or is otherwise suitable to engage in practice as a lawyer.
The committee was not satisfied that the lawyer’s conduct that resulted in his bankruptcy warranted a disciplinary response.
In its decision, the committee drew attention to the guidance on the Law Society website on what to declare when a lawyer is renewing their practising certificate. The guidance advises practitioners to adopt a precautionary approach when advising of problems and, if in doubt, to include them in their application.