New Zealand Law Society - Lawyers’ personal difficulties should not put clients at risk
A Standards Committee (Committee) determined that a lawyer, Ms DJ, engaged in unsatisfactory conduct after she failed to keep her client informed and later terminated the retainer but did not assist her client to find a new lawyer and delayed returning the client file. While the Committee acknowledged that Ms DJ had personal difficulties at the time, her actions left her client “unsupported and vulnerable”. Ms DJ was ordered to pay compensation of $2,000. The decision emphasised that lawyers continue to have professional obligations even in challenging times.
Ms DJ acted for Ms Q in a family law matter that included appeal proceedings in the Court of Appeal. Ms DJ told Ms Q that she planned to engage more experienced counsel to appear in court, but she was unable to find alternative counsel. At short notice, she informed Ms Q that she would do the appearance. Following the court hearing, Ms Q contacted Ms DJ multiple times for an update, but Ms DJ did not respond. Ultimately, Ms DJ wound up her practice but failed to return Ms Q’s file to her in a timely manner and did not help her to find a new lawyer. Ms Q complained to the Law Society Te Kāhui Ture o Aotearoa. The Committee resolved to inquire into the complaint and consider if Ms DJ had breached any of her professional obligations under the Lawyers and Conveyancers (Lawyers: Client Care and Conduct) Act 2008 (RCCC).
The Committee assessed Ms Q’s allegation that Ms DJ was not qualified to appear in the Court of Appeal. She claimed that Ms DJ told her that she had never handled an appeal and she was otherwise inexperienced. Ms DJ submitted that she told Ms Q that she had appeared in the Court of Appeal before, but not as senior or sole counsel. In the Committee’s view, Ms DJ was qualified to act and she could not be criticised for being transparent with Ms Q about her experience.
Ms Q also complained that Ms DJ did not respond to her in a timely manner during the retainer. Prior to the court hearing, Ms Q requested several updates, but Ms DJ was slow to respond. She also did not provide an update following the court hearing, despite Ms Q contacting her several times.
In assessing the facts, the Committee was satisfied that Ms DJ failed to clearly advise Ms Q on when the hearing was scheduled and whether she would be acting in the appeal or finding alternative counsel. Ms DJ had indicated to Ms Q that she could not appear in the Court of Appeal and suggested that she would find alternative counsel. It was not until the day before the hearing that she advised Ms Q that she would be appearing after all. The Committee commented that Ms DJ should have provided more regular updates to Ms Q and she should have informed Ms Q, well in advance, about the date for the hearing and that she would be appearing.
The Committee also assessed the circumstances of Ms DJ’s failure to update Ms Q following the court hearing. It noted that about two months after the hearing, Ms DJ wound up her practice. It added that it is standard practice for lawyers appearing at a hearing to provide a reporting letter or email to the client promptly following the appearance. This is especially essential if the lawyer intended to wind up their practice and may not be able to advise the client once the judgment is released.
The Committee acknowledged that Ms DJ’s “radio silence” meant that when the judgment for Ms Q was released, Ms Q had no knowledge of what happened at the hearing, did not have her file and Ms DJ had wound up her practice so she could no longer advise her. In addition, Ms Q had no information about handover arrangements for a new lawyer, or if such arrangements had been made nor did she have a list of lawyers that she might contact about the judgment. Ms Q had written to Ms DJ twice about the next steps following the judgment release. While Ms DJ was no longer practicing on her own account, she could not give advice, but she still had ongoing communication obligations as Ms Q’s former lawyer. The Committee found that Ms DJ had an obligation to respond to Ms Q in a timely manner and provide a list of lawyers that could advise her. The Committee determined that Ms DJ breached rules 3.2, 7.1 and 7.2 of the RCCC.
The Committee considered the facts around Ms DJ terminating the retainer. In doing so, it had regard to rule 4.2 of the RCCC that provided a lawyer must not terminate a retainer unless they have good cause to do so and after giving reasonable notice and reasons to the client. Rule 4.2.1 provides a list of what “good cause” might include but it is not an exhaustive list.
Ms DJ terminated the retainer because she was winding up her practice and shifting into an in-house role. She informed Ms Q that she was in the process of doing so. She later started work as an in-house lawyer and the Committee noted that her practising certificate as an in-house lawyer did not permit her to act for any party other than her employer. It found that winding up her practice was a necessary step as she changed roles. Therefore, Ms DJ did not breach rule 4.2 of the RCCC.
The Committee then assessed whether Ms DJ complied with her obligation under rule 4.2.4 of the RCCC that required her to provide Ms Q with reasonable assistance to find another lawyer following termination of the retainer. On review of the facts, the Committee noted that Ms DJ had mentioned Ms Q’s matter to other lawyers, but she did not follow up or make any handover arrangements. Ms DJ also delayed returning the client file to Ms Q (discussed further below) and those delays meant that Ms Q was left in a position where Ms DJ did not help her find a new lawyer and Ms Q’s own efforts to find a lawyer were impacted because she did not have her file. The Committee commented that because of Ms DJ’s conduct, Ms Q was “…left unsupported and vulnerable and missing her opportunity of taking any action further to the judgment of the Court of Appeal.” It determined that Ms DJ breached rule 4.2.4 of the RCCC.
The Committee assessed Ms DJ’s delayed return of the client file to Ms Q. It had regard to rule 4.4.1 of the RCCC that provided the right for Ms Q to uplift her file and required Ms DJ to act upon any written request to uplift without “undue delay”.
In reviewing the timeline of events, the Committee noted Ms Q requested her file in writing about one year after the hearing. It was not until Ms Q made a formal complaint to the Law Society that Ms DJ provided the file to the Lawyers Complaint Service to pass on to Ms Q. Therefore, it took about six months for Ms DJ to supply the file following Ms Q’s request. The Committee found that six months is “clearly” an “undue delay”. In addition, the Committee noted that from the time Ms DJ appeared in court on Ms Q’s behalf and wound up her practice, it had taken Ms DJ one and a half years overall to provide Ms Q with her file. Ms DJ acknowledged the delays. She said that she was unwell and facing mental health difficulties during that period. The Committee acknowledged Ms DJ’s circumstances but emphasised that it was incumbent on Ms DJ to:
…seek appropriate support and ensure that any personal issues she was experiencing did not expose her clients to risk or disadvantage as a result of non-compliance with professional obligations. For example, if [Ms DJ] was not able to attend to the return of the files herself, she ought to have engaged administrative support.
The Committee emphasised that the delay in transferring the client file to Ms Q caused Ms Q emotional distress and financial loss. She was unable to obtain proper legal advice regarding the judgment without recourse to the file. It also delayed any next steps that Ms Q would have had to take in terms of the judgment. Ms Q stated that she had “…lost faith in the legal system following [Ms DJ’s] conduct, especially as [Ms DJ] was well aware of the challenges [Ms Q] had faced in pursuing her case and the delays that she had already suffered.”
The Committee determined that Ms DJ failed to act without undue delay and breached rule 4.4.1 of the RCCC. She also breached her fiduciary obligations under s 4(c) of the Lawyers and Conveyancers Act 2006 (LCA). In addition, the unreasonable delay constituted a failure to promote and maintain professional standards that breached rule 10 of the RCCC.
Overall, the Committee considered that Ms DJ’s conduct fell short of the standard of competence and diligence that a member of the public is entitled to expect of a reasonably competent lawyer. Similarly, lawyers of good standing would regard her conduct as being unacceptable. It followed that Ms DJ’s behaviour amounted to unsatisfactory conduct pursuant to s 12(a), (b) and (c) of the LCA.
In determining a penalty, the Committee assessed the seriousness of Ms DJ’s conduct in the low to medium range. It commented that despite Ms DJ’s initial reluctance to appear in the Court of Appeal, she acted responsibly in the hearing and avoided a situation where Ms Q was left unrepresented. There was also no reason to consider her advocacy fell below professional standards. However, the Committee was concerned by the delays and communication failures that impacted Ms Q. In recognition of the anxiety, inconvenience and distress Ms Q suffered, the Committee ordered Ms DJ to pay compensation of $2,000. The Committee took into consideration that Ms DJ had experienced wellbeing challenges and it chose not to impose a fine or costs. It added that this was a “significant concession” to Ms DJ, noting that in the ordinary course, a fine and costs would follow a finding of unsatisfactory conduct.
The Committee directed that an anonymous summary be published for its education value. It commented that the decision “…serves as a reminder of the importance of effectively managing mental health issues, overwhelming workload and winding up a practice.”