New Zealand Law Society - Systems should be in place to respond to clients even in challenging circumstances
A Standards Committee (Committee) determined that a lawyer, Mr TY, breached his professional obligations after he failed to keep his client informed and failed to respond to his client in a timely manner. In addition, while Mr TY had good cause to terminate the retainer due to a death in the family, he failed to provide his client with reasonable assistance to find a new lawyer. The Committee concluded Mr TY’s behaviour amounted to unsatisfactory conduct. He was fined $1,000. The Committee emphasised to the profession that lawyers, especially sole practitioners or lawyers in small firms, should have systems in place to respond to clients regardless of the circumstances.
Mr TY acted for Mr B in a property dispute. He provided advice that included Mr B engaging with third party services to obtain specialist reports and further evidence. Mr B progressed the matter and then asked Mr TY multiple times for assistance, but he did not hear from Mr TY for several months. He subsequently filed a complaint with the New Zealand Law Society Te Kāhui Ture o Aotearoa. Separately, Mr TY emailed Mr B and apologised for his lack of communication. He explained that a family member had died unexpectedly. He suggested that Mr B find another lawyer with construction expertise or apply for legal aid if possible.
The Committee resolved to inquire into the complaint. The key issues for consideration were whether Mr TY acted in a timely manner, if he had good cause to withdraw as counsel, if his email to Mr B constituted a termination of the retainer and if he provided Mr B with reasonable assistance to find another lawyer.
Mr TY provided the Committee with an email timeline describing the work he completed for Mr B between 7 August and 17 March when he terminated the retainer. He also advised that his family member died in early March.
During its assessment, the Committee acknowledged that from 7 August to 5 November, Mr TY was engaged in the matter and provided advice to Mr B about coordinating expert reports. However, the timeline showed that from 5 November to 17 March, Mr TY did no other work. During that period, Mr B had sent four inquiry emails to Mr TY, but he did not respond. The Committee could not identify any reason that would explain Mr TY’s failure to respond or do any work for Mr B between 5 November and the passing of his family member in early March. It concluded that Mr TY had breached rules 3 and 3.2 of the RCCC as he failed to act in a timely manner to advance Mr B’s matter and did not respond to his inquiries.
The Committee went on to consider whether Mr TY informed Mr B of the material and unexpected delays in his matter as required by rule 3.3 of the RCCC. It found that an expert report, which Mr TY had identified as necessary to advance Mr B’s case had been obtained and provided to Mr TY on 7 January. Mr B asked Mr TY to review the report and provide comments. The Committee found that Mr TY’s failure to review the report or respond to Mr B caused a material and unexpected delay in progressing Mr B’s matter. It concluded that failing to inform Mr B over two months that there would be a delay breached rule 3.3 of the RCCC.
Rule 4.2(c) of the RCCC requires a lawyer to act for client and complete the work under the retainer unless the lawyer has good cause to terminate and the lawyer gives reasonable notice and specifies the grounds for termination. In addition, rule 4.2.1 of the RCCC lists factors of what “good cause” to terminate may include.
Mr TY withdrew as counsel due to the death of a family member and extensive family obligations. While this is not one of the factors listed as “good cause” in rule 4.2.1 of RCCC, the Committee noted that list is not exhaustive. It concluded that Mr TY had good cause to terminate the retainer with Mr B. The Committee added that Mr TY had also provided reasonable notice. He advised Mr B of his circumstances about 13 days after the passing of his family member. The Committee further considered that the reasonableness of the notice was supported by the fact Mr TY had no intention of charging any legal fees and court proceedings had not been filed. To conclude, Mr TY did not breach rule 4.2(c) of the RCCC.
As required by rule 4.2.4 of the RCCC, when a lawyer terminates a retainer, they must give reasonable assistance to the client to find a new lawyer. In assessing this issue, the Committee had regard to Mr TY’s email to Mr B suggesting that Mr B should “approach the main firms with expertise in construction contracts” or apply for legal aid if possible. Mr TY submitted that he believed this was sufficient and that, had Mr B told him he needed more help, he would have continued to assist. The Committee disagreed. It concluded that Mr TY’s “brief suggestions” were insufficient. On assessment, the Committee found that it was incumbent on Mr TY to:
…at a minimum, provide [Mr B] with a list of lawyers (or firms) with experience in construction disputes who could potentially assist [Mr B] and/or provide [Mr B] with information on how to apply for Legal Aid. The [Committee] further considered that such information is not unduly burdensome and, further, is standard practice in the legal profession when terminating a client’s retainer.
In regard to Mr TY’s comment that he would have continued to assist had Mr B asked, the Committee commented that it was Mr TY’s duty, not the client’s duty, to meet the requirements of the RCCC. The Committee found that Mr TY breached rule 4.2.4 of the RCCC.
In concluding the matter, the Committee determined that Mr TY breached rules 3, 3.2, 3.3 and 4.2.4 of the RCCC and amounted to unsatisfactory conduct. In determining the penalty, the Committee commented that the obligations for a lawyer to act on a matter and respond to a client in a timely manner as well as provide reasonable assistance to find alternative counsel upon termination of a retainer are “cornerstones” of good legal practice. Clients are entitled to expect this base level of professionalism, even in challenging circumstances. Accordingly, Mr TY was fined $1,000.
The Committee ordered that an anonymised summary be published. It considered that the case provided valuable education to the profession. It emphasised the importance of ensuring that practitioners, particularly sole practitioners or small firms have appropriate systems in place to ensure timely responses to clients regardless of the circumstances.