This article was published in LawTalk 926 with the title 'Principles and practice: Publication, penalties and prosecutions'.
Last month the Law Society published a decision by a standards committee which made an adverse disciplinary finding against a lawyer, following two separate instances of sexual harassment towards two employees.
Standards committees are independent bodies and are comprised of up to 7 lawyer members and up to 2 non-lawyer members.
The decision has been the subject of public comment and criticism, including: whether the lawyer’s actions ought to have been assessed as amounting to misconduct rather than unsatisfactory conduct; whether the lawyer ought to have been suspended from practice (the lawyer was instead censured and ordered to pay a fine, and costs, to the Law Society); and/or whether the lawyer’s identity ought to have been disclosed in the published standards committee decision. The Law Society welcomes such public debate.
It is not appropriate for the Lawyers Complaints Service to publicly comment on an independent standards committee decision and so it is not the intention of this article to seek to justify or defend the decision. The parties to the matter have (or had) rights of review to the Legal Complaints Review Officer if they are dissatisfied with the standards committee decision. The New Zealand Law Society also has (or had) the right to seek a review - see sections 193 to 198 of the Lawyers and Conveyancers Act 2006.
Subject to those caveats, and in light of the current regulatory regime (discussed below), this article is intended to discuss, in a general (non-case-specific) manner:
- the distinction between unsatisfactory conduct and misconduct;
- the respective jurisdiction, and procedures, of standards committees vs the New Zealand Lawyers and Conveyancers Disciplinary Tribunal ("Disciplinary Tribunal"); and
- the underlying rationale in relation to imposing a disciplinary sanction on a lawyer, including the legal principles governing name publication.
Unsatisfactory conduct vs misconduct
Both concepts are comprehensively defined in the Lawyers and Conveyancers Act 2006 ("LCA") - see sections 12 (unsatisfactory conduct) and 7 (misconduct).
The essence of the threshold of unsatisfactory conduct (as it applies to sexual harassment in the workplace, under the current legislation) is that the conduct would be regarded by lawyers of good standing as being unacceptable (including conduct unbecoming a lawyer, or unprofessional conduct).
A finding of unsatisfactory conduct can also be made if a lawyer contravenes the Lawyers and Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008 ("Rules"). Over the past decade, unsatisfactory conduct findings have been imposed in relation to conduct such as: overcharging; breach of duty to take reasonable care; and unintentional breach of a lawyer’s undertaking.
As is self-evident, misconduct is more serious than unsatisfactory conduct. Only the Disciplinary Tribunal can make findings of misconduct. Matters come before the Disciplinary Tribunal following referral, and the laying of a disciplinary charge against a lawyer, by a standards committee (sections 152(2)(a) and 227(b) of the LCA). The most common threshold test for misconduct under the current legislation (which can also be applied to sexual harassment in the workplace) is conduct that would reasonably be regarded by lawyers of good standing as disgraceful or dishonourable.
A finding of misconduct can also be made if a lawyer wilfully or recklessly contravenes the Rules, or engages in conduct that would justify a finding they are not a fit and proper person or are otherwise unsuited to engage in practice as a lawyer. Over the past decade, misconduct findings have been imposed in relation to conduct such as: gross overcharging; serial incompetence; and willful or reckless breach of a lawyer’s undertaking.
Standards committees vs Disciplinary Tribunal
As noted above, standards committees can make findings of unsatisfactory conduct only; they do not have jurisdiction to make findings of misconduct. Following a finding of unsatisfactory conduct, a standards committee can impose a variety of orders (section 156) against the lawyer, including: censure or reprimand; direction to apologise; direction to pay monetary compensation of up to $25,000 to the complainant or affected party; and to pay a fine of up to $15,000 and/or costs to the Law Society.
The New Zealand Lawyers and Conveyancers Disciplinary Tribunal can make findings of unsatisfactory conduct and misconduct. The Disciplinary Tribunal has jurisdiction to impose all orders which are available to standards committees (section 242). In addition, the Disciplinary Tribunal has the ability to remove a lawyer from practice (either temporarily, by way of suspension for up to 3 years; or permanently, by way of strike-off from the roll of barristers and solicitors). It can also order that a lawyer is not able to practise on their own account (i.e. as a sole practitioner, partner or director of a law firm).
Standards committee hearings are almost exclusively conducted “on the papers”, and are held in private. This is the default position established by section 153 of the LCA. By contrast, the default position is that Disciplinary Tribunal hearings are held in public, with the parties appearing in-person (or through counsel) before the Disciplinary Tribunal. This reflects the policy decision that standards committees deal with matters of unsatisfactory conduct only, whereas the Disciplinary Tribunal also deals with more serious matters (ie, misconduct) where evidence is examined and tested in a quasi-court setting and considerations of open justice prevail.
This distinction also has implications in terms of publication of decisions. The statutory presumption is that standards committee decisions remain confidential to the parties, unless a standards committee directs publication as it considers necessary or desirable in the public interest (section 142(2)). As the Court of Appeal noted in New Zealand Law Society v B [2013] NZCA 156 at [47] (footnotes omitted):
"The different legislative approach on the issue of publication between the Disciplinary Tribunal and standards committees and the LCRO [Legal Complaints Review Officer] no doubt reflects the policy decision that it is the Disciplinary Committee [sic] that deals with the more serious matters, which in the public interest should be dealt with openly, whereas the lesser matters dealt with by Standards Committees and the LCRO may or may not justify publication after having been dealt with privately..."
By contrast Disciplinary Tribunal decisions are, in the absence of any order to the contrary, publicly available. This is indicative of the importance of more serious disciplinary matters being in the public domain, and is consistent with two of the purposes of the LCA - to maintain public confidence in the provision of legal services, and to protect the consumers of legal services (section 3(1) of the LCA).
As noted above, standards committees can only make findings of unsatisfactory conduct; it is the Disciplinary Tribunal that has sole jurisdiction to make a misconduct finding against a lawyer (following referral by a standards committee). There is no threshold for a standards committee to refer a matter to the Disciplinary Tribunal and the Disciplinary Tribunal can make findings against a lawyer of unsatisfactory conduct (as well as misconduct). The High Court has, however, observed in Hart v Auckland Standards Committee 1 of the New Zealand Law Society [2013] 3 NZLR 103 at 128:
"In practice, standards committees will in most cases only refer a complaint to the Tribunal if the alleged conduct forming the basis of the complaint is sufficiently serious to warrant consideration of suspension or striking off ..."
While there is no threshold to refer a matter to the Disciplinary Tribunal, a degree of pragmatism is sometimes viewed as appropriate. A standards committee may decide to refrain from referring a matter to the Disciplinary Tribunal if (were the matter to be referred) the prosecuting standards committee would not be seeking a sanction of suspension from practice or strike-off from the roll of barristers and solicitors. That might be because of a variety of different factors, including mitigating and/or medical circumstances, and an assessment there is a low risk of the lawyer reoffending.
Proceedings before the Disciplinary Tribunal can be costly and time-consuming, and may involve litigation risk (given the more serious the allegation/disciplinary charge, the stronger the evidence has to be before the Disciplinary Tribunal will find the charge established on the balance of probabilities): Z v Dental Council of New Zealand CIV-2010-485-2249 (2 December 2011) at [41]. Given the quasi-court procedures of the Disciplinary Tribunal (including cross-examination), proceedings can also be emotionally challenging for the person harmed by the lawyer’s conduct, as well as witnesses.
After taking such factors into account a standards committee may consider it appropriate to make a finding of ‘high-end’ unsatisfactory conduct rather than laying a charge in the Disciplinary Tribunal for misconduct. A contrary view, of course, might be that all instances of prima facie misconduct ought to be referred to, and prosecuted by a standards committee before the Disciplinary Tribunal (with all mitigating circumstances and the like to be assessed by the Disciplinary Tribunal rather than the standards committee).
Any such pragmatism by a standards committee does need to be tempered in light of the following observations of the Court of Appeal (Orlov v New Zealand Law Society [2013] 3 NZLR 562 (CA) at 576:
"Having regard to the legislative purposes of consumer protection and the maintenance of public confidence in the provision of legal services, it is in our view important that the Tribunal be able to determine some complaints even though the likely sanction will not involve striking off or suspension. The complaints may for example involve complex issues of law or fact or be likely to result in a significant precedent..."
Penalties – rationale, and name publication
Rationale
In contrast to criminal proceedings (which reflect adversely upon the individual offender), breaches of professional standards may reflect upon the whole profession. The public (as well as members of the legal profession) are entitled to scrutinise the manner in which lawyers are disciplined, because it is the profession in which the public must have confidence if lawyers are to properly provide the necessary legal services to the public (Daniels v Complaints Committee 2 of the Wellington District Law Society CIV-2011-485-000227 (High Court Wellington, 8 August 2011) at [34]).
As established by case law (Daniels at [22] and Roberts v A Professional Conduct Committee of the Nursing Council of New Zealand [2012] NZHC 3354 at [44] to [51]), the main purposes of the penalty function of both standards committees and the Disciplinary Tribunal are to: protect the public (including ordering penalties that will deter the respondent lawyer, and other lawyers, from offending in a similar way); set and maintain professional standards; impose sanctions on a lawyer for breach of his/her duties; and to provide scope for rehabilitation in appropriate cases.
When setting a penalty, the starting point is fixed according to the gravity of the unsatisfactory conduct or misconduct, as well as the culpability of the lawyer for the particular breach of professional standards. Thereafter, a balancing exercise is required to factor in mitigating circumstances and other considerations (Daniels at [28]). As the High Court has said (Daniels at [28] and [29]):
"...Obviously, matters of good character, reputation and absence of prior transgressions count in favour of the practitioner. So, too would acknowledgement of error, wrongdoing and expressions of remorse and contrition. For example, immediate acknowledgement of wrongdoing, apology to a complainant, genuine remorse, contrition, and acceptance of responsibility as a proper response to the Law Society inquiry, can be seen to be substantial mitigating matters and justify lenient penalties...
"On the other side of the coin, absence of remorse, failure to accept responsibility, showing no insight into misbehaviour, are matters which, whilst not aggravating, nevertheless may touch upon issues such as a person’s fitness to practise and good character or otherwise."
Punishment is not the primary purpose, although penalty orders inevitably will have some such effect (Daniels at [28]). A penalty ought to be fair, reasonable and proportionate in the circumstances (Daniels at [28]). The High Court has also said a penalty ought to be the least restrictive that can reasonably be imposed in the circumstances (which is akin to the ‘least restrictive outcome’ principle applicable in criminal sentencing) (Daniels and Roberts at [50]).
Whilst made in the context of disciplinary proceedings against a health professional, the following observations of the High Court (in relation to rehabilitation) may also be applicable to legal professionals (Roberts at [47]):
"A reason why rehabilitation may be an important consideration is that health professionals and society as a whole make considerable investments in the training and development of health practitioners. Where appropriate, the Tribunal should endeavour to ensure these investments are not permanently lost, provided of course the practitioner is truly capable of being rehabilitated and reintegrated into the profession."
Name publication
For a lawyer, name publication will invariably be the most significant element of a penalty imposed by a standards committee or the Disciplinary Tribunal. Short of being struck-off the roll, a lawyer’s reputation is everything and, once lost, is difficult to regain.
When considering whether to publish the identity of a lawyer who has been the subject of a censure order (a censure order being a prerequisite to name publication by a standards committee), the standards committee (and the Board of the Law Society) is required to take into account the public interest and the impact of publication on the interests and privacy of: the complainant; clients of the censured lawyer; relatives of the censured lawyer; partners, employers, and associates of the censured lawyer; as well as the censured lawyer him/herself (Regulation 30 of the Lawyers and Conveyancers Act (Lawyers: Complaints Service and Standards Committees) Regulations 2008).
The position is different for the Disciplinary Tribunal. Given the public nature of (the generally more serious) proceedings before the Disciplinary Tribunal, the starting position is publication of the whole of the Disciplinary Tribunal’s decision, including the name of the lawyer charged before the Disciplinary Tribunal (as noted above). So, in the absence of orders to the contrary, the name of the lawyer will be able to be published in the media.
The public interest may be protected by means other than name publication. This may arise, for example, where the lawyer is no longer practising. Such a circumstance might be a factor weighing against a decision to publish the lawyer’s name.
Embarrassment, distress and emotional harm are generally not sufficient to justify name suppression (Complaints Assessment Committee 403 v Licensee B [2017] NZREADT 21 at [48] and the cases cited therein).
Non-publication of a lawyer’s name (whether by a standards committee or the Disciplinary Tribunal) may be appropriate in circumstances where the lawyer will be able to continue in practice. As the High Court has said (B v B High Court, Auckland, HC 4/92, 6 April 1993 at page 99; This was cited with approval in Lewis v Wilson & Horton Ltd [2000] 3 NZLR 546 (CA) at [42]):
"In normal course where a professional person appears before a disciplinary tribunal and is found guilty of an offence, that person should expect that an order preventing publication of his or her name will not be made. That will especially be so where the offence found to be proved, or admitted, is sufficiently serious to justify striking off or suspension from practice. But where the orders made by a disciplinary tribunal in relation to future practice of the defendant are directed towards that person’s rehabilitation and there is no striking off or suspension but rather, as here, a decision that practice may continue, there is much to be said for the view that publication of the defendant’s name is contrary to the spirit of the decision and counter-productive. It may simply cause damage which makes rehabilitation impossible or very much harder to achieve."
Reporting unacceptable conduct
Lawyers are required to submit a confidential report to the Law Society if they have reasonable grounds to suspect another lawyer has been guilty of misconduct.
Lawyers can also provide a report if they have reasonable grounds to suspect another lawyer has been guilty of unsatisfactory conduct.
These obligations flow from Rules 2.8 and 2.9. The reporting lawyer does not have a responsibility to make a definitive decision on whether the conduct in question amounts to unsatisfactory conduct or misconduct; those are matters for a standards committee and Disciplinary Tribunal to determine. Guidance on reporting unacceptable conduct can be found here.
Looking ahead
2019 is going to be a year of regulatory change for the legal profession. As readers will know, in December last year the Board of the Law Society accepted the recommendations made in a report on the regulatory processes for lawyers where unacceptable workplace behaviour occurs. The report identifies a range of problems with the current reporting regime and concludes that the regulatory mechanisms and processes are not designed effectively for dealing with complaints about sexual violence, harassment, discrimination and bullying.
This article has been written based on current legislative provisions, regulations, and case law authority. Amongst other things, there may well be future changes to the law governing name publication or suppression in the context of established instances of sexual violence, harassment, discrimination and bullying within the legal profession. Watch this space.
Matt Fogarty is Senior Solicitor - Regulatory with the New Zealand Law Society.