New Zealand Law Society - Lawyer was acting as trustee

Lawyer was acting as trustee

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Names used in this article are fictitious

The Legal Complaints Review Officer (LCRO) has upheld a lawyers standards committee decision to take no further action against a lawyer accused of wrongly holding himself out as a trustee (LCRO 160/2017).

Both the complainant, Mr Grayper, and the lawyer, Lenville, owned properties that, along with several other properties, had the use of a private accessway.

The land comprising the accessway was held by three trustees. At the relevant time, Lenville was acting as one of those trustees.

After a landslip on the accessway resulted in erosion, one of the landowners requested a geotechnical engineer “to assess the potential and remediation work required”.

Some years later, another of the landowners, Ms Chadband, proposed carrying out work on her property. Mr Grayper said he was concerned about the risk of a further landslip and warned Ms Chadband’s contractor that “the lower part of the accessway was in a slip zone”.

Further subsidence resulted in the accessway being closed for safety reasons. Mr Grayper said that this deprived the beneficiaries of “access for an entire season”.

Mr Grayper lodged a complaint with the Lawyers Complaints Service about the way Lenville conducted himself in authorising the contractor to use the accessway to gain access to and to carry out work on Ms Chadband’s property. Mr Grayper alleged that Lenville made misrepresentations and had a conflict of interest which, in his view, constituted misconduct.

Mr Grayper claimed that Lenville wrongly held himself out as a trustee when evidence showed he had not been validly appointed. He also said that Lenville benefitted from the authorisation given as he then employed the contractor to carry out work on his own property.

The LCRO noted that in its decision, the standards committee stated that because Mr Grayper’s complaint concerned Lenville’s role on the behalf of a trust, the issue for consideration was whether the committee had jurisdiction to consider the complaint.

The committee determined that while it “can review the conduct of lawyers” it “cannot review the actions of a trustee” which is “a matter for the High Court even where the trustee is a lawyer”. The proper course for Mr Grayper “is an application to the courts”, the committee said.

The LCRO concluded that Lenville’s interactions with Mr Grayper, the contractor and Ms Chadband, including his authorisation to the contractor, were in his capacity as an “endorsed” or “acting” trustee, and not as a lawyer.

Lenville’s explanation of the background to his “election” as a trustee and the authorisation he provided in that capacity “also lend support for the view that he had not set out to mislead” as to his role, the LCRO said.

“I appreciate that Mr [Grayper] wishes to resolve the appointment of trustees issue in the interests of continued use of the accessway by the [estate’s] property owners, and the protection of both the accessway and adjacent properties to the fullest extent possible from damage caused by natural events.

“However, he does have the alternative courses open to him of calling a meeting of property owners to discuss this issue and agree a course of action. Also, as considered appropriate, applying either alone or with other property owners who are beneficiaries, to the High Court,” the LCRO said.

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