McLanahan v The New Zealand Registered Architects Board
[2016] NZHC 2276
•26 September 2016
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
CIV-2016-485-000002 [2016] NZHC 2276
UNDER Part 1 of the Judicature Amendment Act
1972 and Part 30 of the High Court Rules
IN THE MATTER OF
A request for judicial review of the dismissal of a complaint under Rules 65-
71 of the New Zealand Registered
Architects Rules 2006BETWEEN
JEREMIAH MCLANAHAN AND E-LYN TAN
Plaintiffs
AND
THE NEW ZEALAND REGISTERED ARCHITECTS BOARD
First Defendant
STEPHEN McDOUGALL Second Defendant
Hearing: 12 September 2016 Counsel:
H N McIntosh for Plaintiffs
T Sissons for First Defendant
J M Morrison for Second DefendantJudgment:
26 September 2016
JUDGMENT OF COLLINS J
Introduction
[1] Mr McLanahan and Ms Tan have applied for judicial review of a decision of the New Zealand Registered Architects Board (the Board). In its decision the Board declined to refer to a disciplinary committee a complaint Mr McLanahan and Ms Tan
had lodged with the Board against Mr McDougall, their former architect.
McLANAHAN v THE NEW ZEALAND REGISTERED ARCHITECTS BOARD [2016] NZHC 2276 [26
September 2016]
Mr McLanahan and Ms Tan have asked the Court to quash the Board’s decision and
refer their complaint to a disciplinary committee.
[2] I am dismissing Mr McLanahan’s and Ms Tan’s application for judicial review because although the Board made some errors in its decision, those errors were either not reviewable errors, or do not warrant me exercising my discretion to grant judicial review.
[3] This judgment is divided into three parts. Part I explains the regime for disciplining architects in New Zealand. Part II explains the background to the dispute. It includes a summary of Mr McLanahan’s and Ms Tan’s complaint and the decisions of an investigating committee adopted by the Board. The grounds for judicial review are also explained in this part of the judgment. Part III analyses the issues and explains the reasons for my decision.
PART I: THE DISCIPLINARY REGIME FOR ARCHITECTS
Legislation
[4] The Registered Architects Act 2005 (the Act) and the Registered Architects Rules 2006 (the Rules) prescribe the regime for disciplining architects in New Zealand.
[5] The Act replaced the Architects Act 1963, which imposed a high threshold for disciplining architects. Under the Architects Act 1963, an architect could be disciplined if he or she was:1
… guilty of grave impropriety or infamous conduct in a professional respect; or … guilty of gross carelessness, or gross neglect, or gross incapacity, in the performance of his [or her] professional duties; or … guilty of any act or default discreditable to an architect ….
[6] The Act was passed in an era when Parliament reviewed disciplinary regimes for a number of professions and occupational groups.2 A common theme to the
1 Architects Act 1963, s 42(b). Under the Architects Act 1963 an architect could also be subject to disciplinary proceedings if he or she was convicted of a crime involving dishonesty or adjudged bankrupt: s 43(a) and (c).
2 See for example, the Health Practitioners Competence Assurance Act 2003 relating to the
reforms was an increased emphasis on consumer protection, greater transparency in disciplinary regimes, and, generally, a lowering of the threshold for disciplining members of professions and occupational groups.
[7] Any person may complain to the Board about the conduct of a registered architect3 and the Board is required to investigate a complaint and decide whether or not to proceed with the complaint in accordance with the Rules, as soon as practicable after receiving the complaint.4
[8] If the Board decides to proceed with the complaint, the Act requires it to appoint one or more persons to investigate and report on the complaint5 and after considering the report determine the complaint in accordance with the Rules.6
[9] Section 25 of the Act sets out four broad grounds upon which an architect can be disciplined. Two of those grounds are relevant to this case namely, an architect can be disciplined if he or she has breached the code of ethics contained in the Rules or practised in a negligent or incompetent manner.7
[10] The disciplinary penalties which the Board may impose range, in descending level of severity, from cancellation of the architect’s registration8 to the imposition of a fine not exceeding $10,000.9
[11] In exercising its disciplinary decision-making powers and functions, the
Board must observe the rules of natural justice10 and comply with applicable
discipline of 22 categories of health professionals; the Lawyers and Conveyancers Act 2006, relating to the discipline of lawyers; the Chartered Professional Engineers of New Zealand Act
2002, relating to the discipline of engineers and the Real Estate Agents Act 2008, relating to the discipline of real estate agents.
3 Registered Architects Act 2005, s 24(1); Registered Architects Rules 2006, r 59(1).
4 Registered Architects Act 2005, s 24(2)(a).
5 Section 24(2)(b).
6 Section 24(2)(c).
7 Section 25(1)(b) and (c).
8 Section 26(1)(a).
9 Section 26(1)(f).
10 Section 28(b).
procedures under the Rules.11 The Rules set out in further detail the procedures and grounds for disciplining an architect.12
[12] In July 2015 the procedure in the Rules for investigating complaints against an architect were amended (the new Rules). Those amendments are referred to throughout the following paras and explained in [25]. This judgment refers to the Rules in force as at 1 January 2014 except where comparisons are made with the new Rules.
[13] Part 3 of the Rules sets out a code of minimum standards of ethical conduct for architects (the Code). The Code focuses upon four categories of ethical standards which an architect must observe in relation to the public,13 a client,14 the profession15
and other architects.16
[14] The following seven rules in the Code are relied upon by Mr McLanahan and
Ms Tan in this proceeding:17
46 Not misrepresent himself or herself
A registered architect must not represent or promote himself or herself, his or her business, or his or her professional services in a false, fraudulent, misleading, or deceptive manner.
47 Uphold the law
A registered architect must abide by the professional codes of ethics and conduct and laws in force in the countries and jurisdictions in which he or she provides professional services.
48 Exercise unprejudiced and unbiased judgment
A registered architect must exercise unprejudiced and unbiased judgement.
49 Care and diligence
11 Section 28(c).
12 The rules are made pursuant to s 67(1) of the Registered Architects Act 2005.
13 Registered Architects Rules 2006, rr 46 and 47.
14 Rules 48 to 53.
15 Rule 54.
16 Rules 55 to 58.
17 Rules 53 (disclosing conflicts of interest) and 56 (not to maliciously or unfairly criticise or attempt to discredit another registered architect) were relied on for the complaint but have been abandoned in this proceeding.
A registered architect must perform his or her professional work with due care and diligence.
50 Terms of appointment
A registered architect must not undertake professional work unless the registered architect and the client have agreed the terms of the appointment, which may include but need not be limited to, –
(a) scope of work:
(b) allocation of responsibilities:
(c) any limitation of responsibilities:
(d) fee, or method of calculating it, and terms of trade: (e) any provision for termination:
(f) provision for professional indemnity insurance.
51 Remuneration and inducements
A registered architect must–
(a) be remunerated solely by the fees and benefits specified in the appointment or employment agreement; and
(b) not offer any inducements to procure an appointment.
…
54 Act with honesty and fairness
A registered architect must pursue his or her professional activities with honesty and fairness.
[15] The Rules in place at the relevant time provided for a three-stage process for investigating complaints against architects.
Stage 1 – initial investigation
[16] The Board was required, as soon as practicable after receiving a complaint, to carry out an initial investigation of the complaint.18 The initial investigation was to be carried out by a complaints officer who was required to recommend to the chairperson of investigating committees either that the complaint proceed or be
dismissed.19
18 Registered Architects Rules 2006, r 61(1).
19 Rule 63(b).
[17] The grounds for not referring a complaint to an investigating committee were set out in r 62(a) to (g), and are now replicated in r 69. Those grounds included the following four grounds:
(a) there [was] no applicable ground of discipline under section 25(1)(a)
to (d) of the Act;20 or
(b) the subject matter of the complaint [was] trivial; or
(c) the alleged complaint [was] insufficiently grave to warrant further investigation; or
(d) the complaint [was] frivolous or vexatious or [was] not made in good faith …
Stage 2 – investigating committee
[18] If the chairperson of the investigating committee decides that the complaint should not be dismissed, then an investigating committee is required to be appointed and the complaint referred to that committee.21 After investigating the complaint the
investigating committee is required to make a recommendation to the Board.22
[19] The investigating committee’s powers include the ability to:23
(a) make, or appoint a person to make, any preliminary inquiries it considers necessary:
(b) engage counsel to advise the committee on matters of law, procedure, and evidence:
(c) request the person complained about or the complainant to provide to the committee, within a specified period of at least 20 working days that the committee thinks fit, any documents, things, or information that was in the possession or control of the person and that, in the opinion of the committee, was relevant to the investigation:
(d) take copies of any documents provided to it:
(e) receive any evidence that the committee thinks fit.
20 The grounds of discipline under s 25(1) of the Act that were relevant in this case were that the architect breached the code of ethics or practised in a negligent or incompetent manner.
21 Registered Architects Rules 2006, r 64(b).
22 Rule 65.
23 Rule 66.
[20] The investigating committee was empowered to explore conciliation, mediation, arbitration and other dispute resolution processes to resolve a complaint.24 This jurisdiction was removed in the new Rules.
[21] The investigating committee is required to recommend the Board either refer the matter to a disciplinary committee or dismiss the matter on one of the grounds set out in r 62,25 the relevant portions of which are summarised in [17].
Stage 3 – disciplinary committee
[22] If the investigating committee recommends to the Board that the matter proceed to a disciplinary hearing and the Board accepts that recommendation, the Board is required to appoint a disciplinary committee under r 91 and refer the matter to that committee.26 The Board can however delay making a decision to refer a matter to a disciplinary committee pending the outcome of any other legal proceeding that may affect the Board’s finding.27
[23] A disciplinary committee is required to determine the complaint as soon as practicable and recommend to the Board any penalty that should be imposed by the Board under s 26 of the Act if the disciplinary committee decides that there are grounds for disciplining the architect in question.28
[24] The powers of the disciplinary committee are broader than those of the investigating committee. The powers of the disciplinary committee include the ability to receive evidence on oath and summons witnesses.29
2015 Amendments to the Rules
[25] Under the new Rules the Board must decide upon receiving a complaint whether or not to refer the complaint to an investigating committee or dismiss the
complaint on the grounds that it has previously dealt with a complaint in relation to
24 Rule 67.
25 Registered Architects Rules 2006, r 68.
26 Rule 71(b).
27 Rule 70(a).
28 Rule 72.
29 Rule 73.
the same matter or on the basis it does not have jurisdiction to determine the complaint.30 Under the new Rules, the investigating committee must investigate, prepare and present a written report on the matter to the Board. The investigating committee may recommend that the Board refer the matter to a disciplinary hearing or dismiss the complaint on one of the grounds previously set out in r 62(a) to (g), and now contained in r 69, the relevant parts of which are explained in [17].31
PART II: BACKGROUND
The engagement
[26] Mr McLanahan is an American citizen. Ms Tan is Singaporean. They came to New Zealand in 2009 on a diplomatic posting and in 2012 they decided to settle permanently in Wellington.
[27] Mr McDougall is a registered architect practicing in Wellington in a firm called “Studio of Pacific Architecture” (the firm). Although Mr McLanahan’s and Ms Tan’s agreement was with the firm, and a number of architects and employees of the firm worked on their project, Mr McDougall accepts that he was the architect primarily responsible for the services provided to Mr McLanahan and Ms Tan by the firm.
[28] In September 2012, Mr McLanahan and Ms Tan viewed a site at
21 McFarlane Street in Mount Victoria, Wellington. The property comprised an old single dwelling. Mr McLanahan and Ms Tan decided to purchase the property, demolish the existing house, sub-divide the land and build two new houses, one of which would be their family home, and the other would be sold (the project).
[29] Mr McLanahan and Ms Tan spoke with Mr McDougall on several occasions in early October and November 2012. Mr McDougall lives in McFarlane Street and knows a neighbour of the property which Mr McLanahan and Ms Tan purchased. He
showed them properties he had designed and on 16 November 2012 Mr McDougall
30 Rules 61 and 62.
31 Rule 66.
sent Mr McLanahan and Ms Tan an eight page letter setting out the firm’s offer to
provide architectural services for the project (the engagement letter).
[30] The engagement letter included a description of the project, the budget, the scope of services which the firm would provide and the basis upon which fees would be rendered, including the fees for obtaining resource consent and additional services that might be required.
[31] The description of the project in the engagement letter recorded that the family home for Mr McLanahan and Ms Tan was to be approximately 300 m2 (house A), while the second house (house B) was to be in the range of 150 to 200 m2. The engagement letter acknowledged the budget for the project included $1.5 million for house A and $1 million for house B and that the cost of building house A
and house B would be approximately $4,000 per m2.
[32] The scope of services in the engagement letter summarised the services which the firm would provide. Those services included:
(1) a feasibility assessment;
(2) concept design (Work Stage C);
(3) preliminary design (Work Stage D); (4) developed design (Work Stage E); (5) detailed design (Work Stage F);
(6) procurement including tendering and negotiations (Work Stage H);
and
(7) contract administration and observation (Work Stage K). [33] The engagement letter included the following paragraph:
Conditions of Engagement
The provision of our services for your project will be based on the New Zealand Institute of Architects Agreement for Architect Services Long Form (AAS 2011) and this letter should be read in conjunction with that document. Please note that the contents of this letter take precedence over the agreement. We will follow up this letter with a full copy of AAS 2011, to be issued to you at a later date or [sic] if we are successful.
[34] On 23 November 2012, Mr McLanahan and Ms Tan sent the firm a memorandum confirming the agreement and setting out their “brief” to the firm.
Breakdown in the relationship
[35] Mr McLanahan and Ms Tan say problems began to occur in their relationship with Mr McDougall within the first few months of the agreement. The following six examples illustrate what they say led ultimately to the breakdown in their relationship with Mr McDougall.
[36] First, they say, that during the “feasibility and concept design” phase of the contract, Mr McDougall never provided them with designs that met the agreed square metre requirements for house A or house B and they also considered Mr McDougall deliberately compromised the design of house B in order to protect the interests of the neighbour who is a friend of Mr McDougall. They also expressed concern that Mr McDougall charged them $2,000 for a “presentation model” that they had not asked for or wanted.
[37] Second, as the “preliminary design” phase progressed, Mr McDougall began to undertake work on the application for resource consent that would be needed for the project. Mr McLanahan and Ms Tan say they became increasingly concerned about the high cost of that work and over the following months they repeatedly asked Mr McDougall for a copy of his billing records. They say however that despite several times agreeing to do so, Mr McDougall never provided any detailed billing records.
[38] Third, in April 2013 Mr McDougall’s concept design was priced by a quantity surveyor and the resulting overall estimated price was far higher than Mr McLanahan and Ms Tan had agreed to. When they raised this issue with
Mr McDougall they say he seemed confused about the per square metre rate and total budget figure that had been agreed upon. They say Mr McDougall began to include terraced areas within his square metre calculations in order to artificially lower the per square metre cost of each house.
[39] Fourth, Mr McLanahan and Ms Tan say they began to notice what they thought were serious errors in Mr McDougall’s work. For example, they say that in March to May 2013 Mr McDougall miscalculated the site coverage area thereby making house B non-compliant with the District Plan. They say that in March to June 2013 Mr McDougall miscalculated the daylight access plane making a large portion of house A non-compliant with the District Plan. They also say that in August 2013 Mr McDougall used outdated and inaccurate project information to evaluate a tender received from the preferred builder.
[40] Fifth, in August 2013 Mr McLanahan and Ms Tan say they received Mr McDougall’s invoice for July 2013 that included $28,000 in charges for “detailed design”. This caused them concern because they say Mr McDougall had told them by email at the end of July 2013 that the detailed design work had not commenced, nor was he authorised to commence that phase, at that time.
[41] Sixth, Mr McLanahan and Ms Tan say they raised their concerns about errors and billing records during a meeting with Mr McDougall on 29 August 2013. They say that during that meeting Mr McDougall threatened to quit the project unless they abandoned their concerns. They say they were disturbed by the threat and reviewed the engagement letter. At this point they say they realised they had not received a copy of AAS 2011. They say they then asked for that document from Mr McDougall and he provided it for the first time on 4 September 2013, 10 months after the commencement of the contract.
[42] These, together with other issues formed the basis of Mr McLanahan’s and
Ms Tan’s subsequent complaint to the Board about Mr McDougall’s conduct.
Termination of the agreement
[43] Mr McLanahan and Ms Tan say they did not agree to all the AAS 2011 terms sent to them by Mr McDougall on 4 September 2013 and that they therefore requested further meetings to sort out the proper contractual basis for their relationship.
[44] On 19 September 2013, Mr McDougall told Mr McLanahan that he was going on holiday and that they would need to confer with Mr Novak, another partner at the firm. Mr McLanahan and Ms Tan met with Mr Novak on three occasions over the next month. On 31 October 2013, Mr Novak emailed Mr McLanahan and Ms Tan a “total package” offer. That offer was unacceptable to Mr McLanahan and Ms Tan because, amongst other reasons, it contained a fixed price for contract administration that was approximately $100,000 greater than the original offer.
[45] Mr McLanahan and Ms Tan decided that they should terminate the agreement. They did so by letter from their solicitor dated 11 November 2013. On
19 November 2013, the solicitor for the firm acknowledged the termination and submitted further invoices to Mr McLanahan and Ms Tan.
[46] Mr McLanahan and Ms Tan then instructed another architect.
[47] The terminated contract is the subject of a civil claim in this Court.32
[48] In March 2014, Mr McLanahan and Ms Tan decided that, irrespective of the outcome of their contractual dispute they had with the firm about fees, they should lay a complaint about Mr McDougall with the Board. They filed their complaint with the Board on 5 March 2014.
[49] On 29 August 2014, the Board advised Mr McLanahan and Ms Tan that their
complaint had been dismissed on the grounds that their complaint was “probably vexatious”.
32 Studio of Pacific Architecture Ltd v McLanahan HC Wellington CIV-2014-085-738.
First judicial review
[50] Mr McLanahan and Ms Tan asked the Board to reconsider its decision. The Board refused to do so. In October 2014, Mr McLanahan and Ms Tan filed an application for judicial review in this Court.33 The parties then negotiated an agreement which resulted in Mr McLanahan and Ms Tan withdrawing their first application for judicial review on the basis that the Board would refer their complaint to an investigating committee. This agreement recorded that the Board did not agree that any reviewable errors were made when dismissing Mr McLanahan and Ms Tan’s complaint.
The investigation
[51] On 5 February 2015, the Board established an investigating committee. The chairperson of the investigating committee was Professor van Raat, a professor of architecture at the University of Auckland, Ms Wright, an architect based in Arrowtown, and Ms Cole, a lay person who has had extensive experience as a member of a number of regulatory and disciplinary bodies.
[52] On 11 February 2015, Mr McDougall submitted 1,500 pages of documentation in response to the complaint.
[53] On 13 March 2015, Mr McLanahan and Ms Tan’s request to address Mr McDougall’s response was granted. Mr McLanahan and Ms Tan’s full response was submitted to the investigating committee on 16 April 2015.
[54] On 8 May 2015, the investigating committee had a telephone conference about the complaint. Following that telephone conference the investigating committee requested appearances from the parties. On 24 July 2015 Mr McLanahan and Ms Tan gave a one hour presentation to the investigating committee. Mr
McDougall met with the investigating committee for approximately two hours.
33 McLanahan v The New Zealand Registered Architects Board HC Wellington CIV-2014-485-
11273.
[55] On 27 July 2015, Mr McDougall was given until 24 August 2015 to respond to “new evidence”34 given during the course of Mr McLanahan’s and Ms Tan’s presentation to the investigating committee.
[56] On 4 August 2015, Mr McLanahan and Ms Tan attempted to reply to new evidence given by Mr McDougall in his presentation to the investigating committee but that request was declined.
[57] On 21 August 2015, Mr McLanahan and Ms Tan wrote to the investigating committee addressing material in Mr McDougall’s response but their letter was rejected.
[58] During the course of the investigatory stage of its deliberations the investigating committee received approximately 3,000 pages of evidence and submissions and conducted hearings that lasted close to three hours.
[59] On 21 September 2015, the investigating committee recommended that the Board dismiss all of Mr McLanahan’s and Ms Tan’s complaint. The Board accepted the investigating committee’s recommendation and dismissed Mr McLanahan’s and Ms Tan’s complaint on 23 September 2015.
The decision
[60] The investigating committee’s recommendations and the Board’s decision responded to Mr McLanahan’s and Ms Tan’s complaint under the following eight headings:
(1) No agreement on terms of the contract. (2) Inappropriate billing practices.
(3) Work errors.
34 An accountant’s letter interpreting the billing figures that Mr McDougall had given in his response.
(4) Deceptive conduct. (5) Conflicts of interest.
(6) Failure to follow clients’ brief.
(7) Confidentiality.
(8) End of relationship.
[61] To avoid unnecessary repetition I shall explain the essential elements of the investigating committee’s recommendations when summarising the grounds of judicial review.
Grounds for judicial review
[62] The amended statement of claim pleads four generic causes of action, namely, that the investigating committee and therefore the Board made errors of law, made errors in the fact-finding process, reached conclusions that were unreasonable and breached the principles of natural justice.
[63] The application for judicial review is polycentric and wide ranging. By my calculations there are 29 allegations of errors of law, 25 allegations of errors of fact, seven allegations of unreasonableness and 20 allegations of breaches of natural justice.
[64] The very extensive submissions advanced by Mr McIntosh in support of the application for judicial review focused upon six of the eight headings of complaints summarised by the investigating committee in its recommendations.35
No agreement on terms of the contract
[65] Mr McLanahan and Ms Tan were concerned that the AAS 2011 document was not provided by Mr McDougall until approximately 10 months after the
35 Refer to [60]. The allegations that Mr McDougall had conflicts of interest and had breached
confidentiality obligations were not pursued in Mr McIntosh’s submissions.
commencement of the contract. They alleged Mr McDougall’s failure to provide a copy of the AAS 2011 with agreed terms breached r 50 which prohibits an architect from undertaking professional work unless the architect and the client agree to the terms of the architect’s appointment.36
[66] The investigating committee was satisfied the engagement letter met the requirements of r 50 and recommended this aspect of the complaint be dismissed under r 62(a) on the basis there was no applicable ground of discipline.
[67] This aspect of the investigating committee’s recommendation was challenged on the basis that its recommendation constituted an error of law. It was submitted by Mr McIntosh that the investigating committee appeared to have reasoned that as the engagement letter was sufficiently detailed to satisfy the requirements of r 50, it did not matter if there was a failure to reach agreement on the terms set out in AAS
2011.
[68] Mr McIntosh submitted the investigating committee’s recommendation was
plainly wrong because:
(1)The requirements of r 50 were not all included in the engagement letter making it impossible to say they were agreed before work was undertaken.
(2) Some of the matters in AAS 2011 were clearly material.
Mr McIntosh also submitted r 50 was designed to protect clients and needed to be interpreted in that light. Mr McIntosh further submitted that the investigating committee’s interpretation was inconsistent with one of its previous decisions
concerning another architect.37
36 Refer to [14].
37 The New Zealand Registered Architects Board v Morrison, 12 April 2013.
Inappropriate billing
[69] In their complaint Mr McLanahan and Ms Tan explained they were concerned Mr McDougall had breached r 54 of the rules, which requires an architect to act with honesty and fairness, in relation to his or her billing practices.38
[70] Four aspects of Mr McDougall’s invoicing practices were examined by the
investigating committee.
Detailed design charges in July 2013
[71] The investigating committee found Mr McDougall had charged Mr McLanahan and Ms Tan $28,000 for detailed design work in July 2013 having advised them at the end of July that detailed design work had not commenced. The complaint was also made that the engagement letter required Mr McLanahan and Ms Tan’s consent for the detailed design phase to proceed. The investigating committee went on to say that this work was necessary for the resource consent application, and did not constitute a prima facie case of dishonesty or unfairness on
the part of Mr McDougall.
[72]
reco
Mr
men
(1)
McIntosh submitted this aspect of the investigating committee’s
ation was a reviewable error of fact because the investigating committee:
did not identify any specific work that was undertaken for the
resource consent that accounted for the $28,000; (2)
failed to have regard to the fact that the resource consent application
had been submitted in June 2013 and work for the resource consent was to be billed separately; and (3)
did not make a finding on whether or not Mr McLanahan and Ms Tan had approved this work.
38 Refer to [14].
He also submitted this recommendation was a breach of the investigating committee’s duty to properly investigate his clients’ allegations and follow a fair procedure because it did not ask for or review any of Mr McDougall’s billing records. Mr McIntosh submitted the records show issues in relation to the hours invoiced being attributed to the wrong phases of work and “misleading billing”. Mr McIntosh submitted that if the investigating committee had made these inquires it would have identified obvious anomalies in Mr McDougall’s explanation. It was also submitted the investigating committee erred in law in acting in an adjudicatory role by reaching a conclusion on the resource management work.
September 2013 detailed design
[73] Mr McLanahan and Ms Tan had alleged Mr McDougall charged them $5,754 for detailed design work in September 2013 notwithstanding they had sent Mr McDougall an email on 26 August 2013 instructing him to “pause” which he confirmed.
[74] The investigating committee said the evidence before it was “contradictory” and that it was satisfied there had been two sets of instructions to “pause” and there was some ambiguity about the instructions given to Mr McDougall. The investigating committee said the fee in question may have been mis-identified by the architect and understood by the clients to be part of the detailed design phase rather than as detailed design associated with an earlier phase of work. The investigating committee said this aspect of Mr McLanahan’s and Ms Tan’s complaint fell short of
establishing a prima facie case of dishonesty or unfairness.39
[75] Mr McIntosh submitted the investigating committee made several errors in its fact-finding process in relation to this aspect of his clients’ complaints. In particular, he said the investigating committee ignored the plain meaning of the text of his clients’ instructions and appeared to accept Mr McDougall’s explanation without providing Mr McLanahan and Ms Tan with a reasonable opportunity to respond.
Mr McIntosh also submitted the investigating committee was wrong to create a
39 Registered Architects Rules 2006, r 54, refer to [14].
defence for Mr McDougall, that he may have mis-identified some of the charges, which Mr McDougall himself did not advance.
Resource consent preparation
[76] Mr McLanahan and Ms Tan had alleged Mr McDougall charged them
$33,000 for resource consent preparation in March and June 2013 and refused to give them the detailed billing records to support those charges.
[77] The investigating committee said that the discounted resource consent cost was $21,710 and therefore close to the $20,000 estimate provided by Mr McDougall. The investigating committee also said there was evidence the billing records had since been provided by Mr McDougall, and concluded that the evidence in relation to this aspect of Mr McLanahan’s and Ms Tan’s complaint did not constitute a prima facie case of dishonesty or unfairness.
[78] Mr McIntosh submitted the investigating committee made errors in its fact- finding process because Mr McDougall acknowledged he had charged Mr McLanahan and Ms Tan over $26,000.40 Mr McIntosh submitted that the investigating committee also made an error when it said there was evidence Mr McDougall had disclosed the billing records. He further submitted the investigating committee made an error of law when it concluded Mr McDougall’s failure to provide billing records was not a breach of r 54.41
Charges beyond the scope of the base fee
[79] Mr McLanahan and Ms Tan had complained about charges rendered by Mr McDougall beyond the base fee for engineering, marketing services and the preparation of a presentation model.
[80] The investigating committee recorded:
40 The Board subsequently acknowledged it had made an error in relation to this aspect of the complaint when it accepted the investigating committee’s conclusion that the discounted resource consent fee was $21,710. The Board declined, however, to reopen the investigation.
41 Refer to [14].
(1)Mr McLanahan and Ms Tan were aware that the engineering work was being considered;
(2)that the evidence relating to marketing was contradictory and that it was not its role to decide disputed matters of fact; and
(3) the fees for the presentation model had been fully discounted.
[81] The investigating committee said that even if Mr McDougall had carried out the engineering and marketing work without the approval of Mr McLanahan and Ms Tan, that would not constitute a failure by Mr McDougall to uphold the law or act with honesty and fairness as required by rr 47 and 5442 as these matters were identified in the engagement letter as additional charges.
[82] Mr McIntosh submitted the investigating committee made an error in its fact- finding process in relation to this aspect of its report because it accepted Mr McDougall’s evidence and explanations without independent verification and ignored the evidence from Mr McLanahan and Ms Tan that they had not agreed to these extra charges. Mr McIntosh also submitted the investigating committee had made an error of law by assuming the role of making findings on disputed facts when that task should have been performed by a disciplinary committee.
[83] In addition, Mr McIntosh submitted the investigating committee made errors of law in failing to address additional issues, such as Mr McLanahan’s and Ms Tan’s argument that demanding payment for unsolicited work was a breach of s 21C of the Fair Trading Act 1986 and possibly r 47.
Work errors
Site coverage error
[84] Mr McLanahan and Ms Tan had complained that Mr McDougall had miscalculated the site coverage ratio for house B by six per cent thereby requiring
42 Refer to [14].
that house to be constructed rather than sold from the plan unless the error was remedied.
[85] The investigating committee concluded this error was not significant and that it had been identified and corrected by Mr McDougall and did not constitute a failure by him to act with care and diligence as required by r 49 or r 54.43
[86] Mr McIntosh submitted the investigating committee made errors in its fact- finding process particularly in relation to its calculation of the site coverage error and that it also made an error of law by “volunteering its own explanation of the issue” so as to justify its finding that Mr McDougall had not breached any rule in the Code.
Daylight access plane
[87] Mr McLanahan and Ms Tan had complained that Mr McDougall had miscalculated the daylight access plane for house A and did not inform them.
[88] The investigating committee found that this error was “identified and corrected by the architect within a reasonable timeframe” and did not constitute a lack of due care or diligence on the part of Mr McDougall.44 Furthermore, the failure to inform the clients of the error did not constitute a failure to act with honesty and fairness.45
[89] Mr McIntosh submitted the investigating committee made errors in its fact- finding process in relation to this aspect of his clients’ complaint by resolving for itself a disputed matter of fact, and that the reasoning process followed by the investigating committee also constituted a reviewable error of law.
Tender oversight error
[90] Mr McLanahan and Ms Tan had complained that Mr McDougall had relied on an obsolete price to validate the costings received from the builder and that he
43 Refer to [14].
44 Registered Architects Rules 2006, r 49, refer to [14].
45 Registered Architects Rules 2006, r 54, refer to [14].
made a significant arithmetical error in a spreadsheet when setting the price for the project.
[91] The investigating committee found the “evidence established” the price given by the builder was not a tender and so found in favour of Mr McDougall on this issue without engaging in the details of the complaint.
[92] Mr McIntosh submitted the investigating committee made errors in its fact- finding process, in relation to evidence suggesting the builder’s price was a tender and also in ignoring the over-calculation error. Mr McIntosh also alleges errors of law in relation to this aspect of its report.
Stormwater pipe error
[93] Mr McLanahan and Ms Tan had complained that house A was designed to sit over a stormwater pipe which needed to be moved at a cost of $30,000. They alleged Mr McDougall either did not know about the stormwater pipe or was negligent in designing house A over that pipe.
[94] The investigating committee concluded Mr McDougall knew about that pipe because it was “on the architect’s drawings” and that this aspect of Mr McLanahan’s and Ms Tan’s complaint should be dismissed under r 62(a) on the ground there was no applicable ground of discipline.46
[95] Mr McIntosh submitted the investigating committee made an error in its fact- finding process because the pipe was drawn on a Wellington City Council plan and not “on the architect’s drawings” and an error of law by resolving a disputed matter of fact in relation to this aspect of his clients’ complaint.
Moving the property line by 100 millimetres
[96] Mr McLanahan and Ms Tan had complained that late in the design process
Mr McDougall had moved the property line between houses A and B by 100
46 Refer to [26].
millimetres and that Mr McDougall’s conduct in this regard breached rr 49 and 54 of
the Code.47
[97] The investigating committee found that moving the property line was required for reasons of “buildability” and that there was no breach of Mr McDougall’s duty to exercise due care and diligence or to act with honesty and fairness.
[98] Mr McIntosh submitted the investigating committee made an error in its fact- finding process and an error of law by resolving a disputed matter of fact in relation to this aspect of his clients’ complaint.
Deceptive conduct
Square metre area calculations
[99] Mr McLanahan and Ms Tan had complained that Mr McDougall changed the method of calculating the square metre area of the houses by including terraced areas in the calculations to bring down the cost per square metre of each building. They alleged under this aspect of their complaint that Mr McDougall had possibly acted in a false, fraudulent, misleading or deceptive way, contrary to r 46 and that he had
breached his duty under r 54 to act honestly and fairly.48
[100] The investigating committee found there was no evidence the change in calculations was made to deceive Mr McLanahan and Ms Tan.
[101] Mr McIntosh submitted that the investigating committee made errors in its fact-finding process when reaching this conclusion and made an error of law by
resolving a disputed matter of fact.
47 Refer to [14].
48 Refer to [14].
Costs tracking
[102] Mr McLanahan and Ms Tan had complained that Mr McDougall had not accurately tracked the costs of the project and in failing to do so had breached rr 48 and 54.49
[103] The investigating committee disagreed and found the costs of the project were tracked continuously and diligently.
[104] Mr McIntosh submitted the investigating committee made an error in this aspect of its fact-finding process including ignoring evidence which showed significant cost savings that had not been included and an error of law when it resolved a disputed fact.
Failure to follow clients’ brief
[105] Mr McLanahan and Ms Tan had complained that Mr McDougall had, in breach of rr 46, 49 and 54,50 failed to produce any designs which met their brief in relation to the size, costs per square metre or the budget for the project.
[106] In essence, the investigating committee concluded that Mr McLanahan and Ms Tan had not established any error on the part of Mr McDougall that justified their complaint proceeding to a disciplinary hearing.
[107] Mr McIntosh submitted that the investigating committee made a reviewable error of law in its fact-finding process in relation to this aspect of his clients’ complaint.
End of the relationship
[108] Mr McLanahan and Ms Tan had complained about the way Mr McDougall
had threatened to terminate their agreement. They said that Mr McDougall’s
conduct constituted a breach of r 54.51
49 Refer to [14].
50 Refer to [14].
51 Refer to [14].
[109] The investigating committee found no evidence that Mr McDougall had failed to act with honesty and with fairness.
[110] Mr McIntosh submitted the investigating committee had made a reviewable
error by mischaracterising the architect’s behaviour and then excusing it.
Unreasonableness
[111] Mr McIntosh submitted that some of the errors said to have been made by the investigating committee were also reviewable on the grounds that the investigating committee’s recommendations were unreasonable and that when viewed holistically, the whole of the investigating committee’s decision “appears …unreasonable”.
[112] Mr McIntosh cited the following aspects of the investigating committee’s
decision as being reviewable on the grounds that its findings were unreasonable: (1) The lack of terms of the contract.
(2) Inappropriate billing. (3) Work errors.
(4) Deceptive conduct.
Breach of natural justice
[113] It was submitted that the investigating committee breached the rules of natural justice when it decided not to afford Mr McLanahan and Ms Tan the opportunity to:
(1) respond to further submissions made by Mr McDougall;
(2) respond to the investigating committee’s own “assertions” constituted
a breach of the principles of natural justice; and
(3)provide further evidence when there was insufficient evidence to make out a ground of complaint.
[114] It was also submitted that the investigating committee’s failure to identify “evidence” relied upon to address specific allegations against Mr McDougall52 or to respond to subsequent Official Information Act requests regarding this evidence constituted a breach of the principles of natural justice.
[115] Finally, Mr McIntosh submitted on behalf of his clients that the principles of natural justice were also breached when the Board denied Mr McLanahan’s and Ms Tan’s request to “reopen, review or appeal” the decisions of the investigating committee and the Board.
PART III: ANALYSIS
Threshold for referral of a complaint to a disciplinary committee
[116] A key issued raised by this proceeding concerns the threshold for referring a complaint from an investigating committee to a disciplinary committee. The issue is whether the investigating committee is required to recommend that the Board refer a matter to a disciplinary committee if it finds the complaint discloses a prima facie case of disciplinary offending, or whether the investigating committee is required to determine there was a “real prospect” of a disciplinary charge succeeding before recommending disciplinary proceedings.
[117] Most of the grounds of judicial review which allege the committee engaged in a flawed fact-finding process and made errors of law are addressed by my decision concerning the threshold for referring a complaint to a disciplinary committee.
[118] In this case, the investigating committee said in a number of places in its report that it was applying the prima facie threshold.53 Mr McIntosh submitted the
role of the investigating committee was to determine whether there was a prima facie
52 In particular the tender oversight error; square metre calculations and failure to follow client’s
brief, refer to [90], [99] and [105].
53 Investigating Committee Investigation Report on complaint or inquiry, 21 September 2015 at
5.2.1, 5.2.2 and 5.2.3.
case of a breach of ethical standards by the architect. The essence of the plaintiffs’ case is that the investigating committee failed to properly apply that test in the circumstances of this case.
[119] Mr Sissons, counsel for the Board and Mr Morrison, counsel for Mr McDougall, submitted that the correct test was whether the investigating committee was satisfied there was a real prospect of the architect being found guilty of a disciplinary offence.
[120] In Owen v Physiotherapy Board,54 Goddard J reviewed a number of statutes then in force concerning disciplinary proceedings for health professionals and lawyers. Goddard J reasoned that although the threshold tests in the various statutes differed as to their wording, the principle common to all the disciplinary regimes she examined was that a professional person should not be subject to disciplinary proceedings unless a prima facie case was established. In adopting the criminal law
threshold for committing a person for trial,55 Goddard J said the same test was
appropriate in professional disciplinary proceedings. The approach adopted by Goddard J in Owen was also endorsed by Ronald Young J in Dallison v Complaints Assessment Committee.56
[121] The threshold advocated by Mr Sissons and Mr Morrison is derived from England and Wales where authorities have referred to the “real prospect” threshold as the “evidential test”.57 That test owes its origins to the Code for Crown Prosecutors for England and Wales and is replicated in some disciplinary contexts in
some parts of the United Kingdom.58 It is questionable whether the “evidential test”
54 Owen v Physiotherapy Board [1997] 3 NZLR 600 (HC).
55 The committal procedure was an initial screening process aimed at establishing whether there was sufficient evidence to put the defendant on trial. The procedure was previously governed by a combination of provisions in the Summary Proceedings Act 1957 and Crimes Act 1961.
Subpart 8 of pt 3 of the Criminal Procedure Act (CPA) now reflects the abolition of the formal
step of committal for trial on the basis that the step had become redundant following the abolition of oral preliminary hearings in 2009. The CPA now integrates the substantive steps associated with committal that enabled evidence to be tested before the trial into a more streamlined pre-trial process to determine evidence admissibility and/or to dismiss a charge under s 147.
56 Dallison v Complaints Assessment Committee HC Wellington CIV-2003-484-2183,
10 November 2005 at [17].
57 Gregory Treverton-Jones, Alison Foster and Saima Hanif Disciplinary and Regulatory
Proceedings (8th ed, Jordan Publishing, 2015) at [6.04] to [6.11].
58 For example, the rules of discipline issued by the Solicitors’ Regulatory Authority and the Bar
label accurately distinguishes between the prima facie and real prospect of success test as both tests involve the decision-maker being satisfied, to different degrees, that there is sufficient evidence to justify prosecuting disciplinary charges. For this reason, I shall refer to the “evidential test” as the “real prospect of success test”.
[122] In Henshall v General Medical Council59 the Court of Appeal for England and Wales considered an application for judicial review from a decision of the Preliminary Proceedings Committee (PPC) of the General Medical Council not to refer three doctors to the Professional Conduct Committee (PCC) to face a disciplinary hearing. The relevant regulation required the PCC to decide if the allegations “appeared to raise a question whether the practitioner had committed serious professional misconduct”.60 The Court of Appeal held this test equated to the real prospect of success test which had previously been articulated in R (on the application of Toth) v GMC61 and Woods v GMC62 in which Burton J said:63
The “real prospect” test applies to both the factual allegations and the question whether, if established, the facts would amount to serious professional misconduct. It reflects not a probability but rather a genuine (not remote or fanciful) possibility. It is in no-one’s interest the case is to be referred to the PCC when they are bound to fail, and the PPC may properly decline to refer such cases. On the other hand, cases which raise a genuine issue of serious professional misconduct are for the PPC to decide.
[123] The relevant powers of the investigating committee include its ability to recommend to the Board that the complaint against an architect be dismissed. The grounds upon which a complaint can be dismissed include that there is “no applicable ground of discipline under s 25(1)(a) to (d) of the Act”.64 This criterion required the investigating committee in this case to take the further step of deciding if there were grounds to refer the architect to a disciplinary committee for breach of
the Code or for practising in a negligent or incompetent manner.
Standards Board.
59 Henshall v General Medical Council [2005] EWCA Civ 1520.
60 General Medical Council Preliminary Proceedings Committee and Professional Conduct
Committee (Procedure) Rules 1988 SI 1988/2255 RR 6(3).
61 R (on the application of Toth) v GMC [2000] 1 WLR 2209.
62 Woods v GMC [2002] EWHC 1484.
63 At [2].
64 Registered Architects Rules 2006, r 62(a) and r 69.
[124] The text of r 62(a) as it applied at the relevant time, and r 69, in the amended rules, does not provide direct guidance on the threshold which must be passed before an investigating committee recommends that a complaint regarding a registered architect be referred to a disciplinary committee. The appropriate threshold can, however, be ascertained by examining the purpose of the Act and Rules in question.
[125] First, as its name suggests, the investigating committee must undertake an investigation. Its investigatory powers are extensive and include the ability to appoint a person to make preliminary investigations, engage counsel, obtain documents and information from the architect and receive evidence, including
evidence from the architect as well as the complainant.65 The process which an
investigating committee follows involves more than simply assessing whether there is a prima facie case for the architect to answer. The investigating committee’s decision may involve a degree of evaluation of contested evidence to determine whether or not the matter in dispute should be considered by a disciplinary committee.
[126] Second, the role of an investigating committee is not the same as that which applies in the criminal jurisdiction when determining whether or not a defendant should be committed for trial. The committal process usually involves an assessment of whether or not the prosecution has produced sufficient evidence to justify a defendant standing trial. Defendants cannot be required to provide evidence at this stage of a criminal trial. The fact an investigating committee is empowered to undertake an evaluation of a complaint and the architect’s response strongly suggests that the prima facie threshold is not the appropriate test for an investigating committee to apply when deciding whether or not an architect should face a disciplinary hearing.
[127] Third, the purposes of rr 62 and 69 include enabling the investigating committee to reach a judgement on whether or not the material before it justifies recommending an architect be referred to a disciplinary committee. The requirement for the disciplinary committee to reach a decision on this issue places a responsibility
on the investigating committee and recognises that cases should not be referred to a
65 Rule 67.
disciplinary committee simply on the basis that there is a prima facie case against the architect. The investigating committee must ensure that matters are not referred to a disciplinary committee when there is no real prospect of a finding against the architect even where there is a prima facie case against him or her. To paraphrase the words of Burton J in Woods v GMC,66 it is in no one’s interest for cases to be referred to a disciplinary committee when there is no real prospect of a disciplinary finding against the architect. The investigating committee may properly decline to recommend referring such cases.
[128] It is important to stress, however, that where there is a real prospect of a disciplinary finding against an architect, it is for the disciplinary committee to decide if in fact the architect is guilty of a disciplinary offence. In this respect, the investigating committee must not trespass on the functions of the disciplinary committee.
[129] When viewed from a purposive perspective, it is apparent that the threshold which the investigating committee is required to apply when deciding whether or not to recommend that an architect be referred to a disciplinary committee is whether or not there is a real prospect of the architect being found guilty of a disciplinary offence.
Errors of fact
[130] It is trite that judicial review is rarely an appropriate mechanism to address disputes about facts. Judicial review may be available however where there have been material errors in the decision-maker’s fact-finding processes, or where an error of fact is so untenable that it constitutes an error of law or is unreasonable.67
[131] I have analysed Mr McLanahan’s and Ms Tan’s challenges to the investigating committee and Board’s factual conclusions by considering whether or not a flawed fact-finding process was followed and whether complained of errors of
fact were so untenable as to amount to a reviewable error.
66 Woods v GMC, above n 62.
67 Bryson v Three Foot Six Ltd [2005] NZSC 34, [2005] 3 NZLR 721 at [23]-[28].
Fact-finding processes
[132] The essence of this aspect of the application for judicial review is that the investigating committee trespassed upon the role of a disciplinary committee by evaluating disputed facts in reaching conclusions that favoured Mr McDougall.
[133] There would be merit to this aspect of the claim for judicial review if the task of the investigating committee was confined to deciding whether or not there was a prima facie case to justify Mr McDougall being prosecuted for a disciplinary offence.
[134] As I have explained, in my assessment, the role of the investigating committee is to evaluate all of the material presented to it, including any explanation provided by the architect, and determine whether or not there is a real prospect of an adverse finding against the architect if the matter is referred to a disciplinary committee.
[135] In this case, the investigating committee, comprising two senior members of the profession and an experienced lay representative, evaluated the material presented to it and concluded in many instances that the material did not disclose a prima facie case. Mr McIntosh submitted that if I concluded the real prospect of success test was the correct threshold then the investigating committee would have applied the wrong test. He submitted in these circumstances the Board and the investigating committee should be required to reconsider their decision.
[136] There is an obvious reason why I reject that submission. Plainly, if the investigating committee was not satisfied of a prima facie case, it could not be satisfied there was a real prospect of a disciplinary finding against Mr McDougall.
Untenable findings
[137] After carefully reviewing all the material presented to me, I have concluded that three findings of fact made by the investigating committee were plainly wrong. In my assessment, all other findings of fact which Mr McLanahan and Ms Tan continue to dispute were findings that the investigating committee was entitled to
make after considering all of the material presented to it, including Mr McDougall’s
explanation.
[138] The three factual errors made by the investigating committee concerned:
(1)Its conclusion that the fees charged for the resource consent application were $21,710 and therefore close to the estimate of
$20,000 provided by Mr McDougall.
(2)Its conclusion that there was evidence of detailed billing records having been provided by Mr McDougall.
(3) Its conclusion that the stormwater pipe was depicted on
Mr McDougall’s designs.
[139] Mr McDougall, and subsequently the Board, acknowledged the fees charged for the additional resource consent were over $26,000. As I understand their case, Mr McLanahan and Ms Tan say that in fact the fees in question were close to
$33,000.
[140] The investigating committee made a factual error in relation to this matter, but in my assessment, its error was not so profound as to constitute a reviewable error of fact.
[141] It is important not to conflate the investigating committee’s factual error with the recommendations that followed from this aspect of Mr McLanahan’s and Ms Tan’s complaint. It is, however, significant that the allegation was that by charging more than he had estimated, Mr McDougall engaged in dishonest and unfair conduct. That allegation involved a degree of moral opprobrium and it is not surprising the investigating committee found, albeit on the basis of an error of fact, that this allegation did not pass the threshold of a prima facie case. It is also significant the Board acknowledged the investigating committee’s error but chose not to reopen this part of Mr McLanahan’s and Ms Tan’s complaint.
[142] In my assessment, even if the investigating committee had reached the correct conclusion as to how much Mr McDougall had charged for this aspect of his work it is highly unlikely it would also have decided that there was a real prospect of a disciplinary committee finding against Mr McDougall on his matter.
[143] For this reason, I conclude that the investigating committee’s error was not
one that constituted a reviewable error of fact.
[144] The investigating committee also made an error when it concluded that Mr McDougall had made his detailed billing records available to Mr McLanahan and Ms Tan.
[145] I have carefully considered whether this error by the investigating committee would justify me quashing this aspect of the investigating committee’s and Board’s decisions and remit this issue back to the Board for further investigation. I have concluded that while the investigating committee made an unfortunate error in relation to this matter, the error was not so profound that the decisions of the investigating committee and the Board in relation to this issue need to be set aside and reconsidered. The reason I have reached this conclusion is that the allegation against Mr McDougall was that his failure to supply detailed billing records constituted dishonesty and unfairness on his part. The investigating committee concluded that the material before it did not pass the prima facie case threshold.
[146] I think it is highly unlikely the investigating committee would have reached another view had it been aware that Mr McDougall had not provided detailed billing records as it is very unlikely that a disciplinary committee would conclude his omission was an act of dishonesty or unfairness, especially in light of my finding that the more appropriate threshold for referral is the real prospect of success test.
[147] The third error made by the investigating committee was when it considered that the stormwater pipe was drawn on Mr McDougall’s plans when in fact it was on a Wellington City Council plan.
[148] The evidence from Mr McDougall was that the stormwater pipe had, on
26 March 2013, been pointed out to Mr McDougall by the structural engineer. Mr McDougall explained to the investigating committee that had his contract extended to the point where detailed design work would have been undertaken then he would have addressed any issues arising from the stormwater pipe.
[149] In my assessment, the evidence in relation to this issue falls well short of that required for the investigating committee to have been satisfied there was a real prospect of Mr McDougall being found guilty of a disciplinary offence had this issue been referred to a disciplinary committee.
Errors of law
[150] During the course of his submissions, Mr McIntosh explained that even if I decided the threshold for referring a matter to a disciplinary committee was the real prospect of success test, the investigating committee’s alleged error of law relating to Mr McLanahan’s and Ms Tan’s complaint about the terms of agreement still needed to be addressed by me. The reason for that was, according to Mr McIntosh, this aspect of Mr McLanahan’s and Ms Tan’s case involved the investigating committee misinterpreting r 50.
[151] The investigating committee’s reasons for recommending against a disciplinary prosecution in relation to this aspect of Mr McLanahan’s and Ms Tan’s complaint do appear to involve a degree of confusion. That confusion was no doubt attributable to the investigating committee deciding not to engage the services of a lawyer to check its report before it was released. The lack of clarity in the investigating committee’s reasons does not however justify me quashing this aspect of its recommendation. My reasons for reaching this conclusion can be succinctly stated.
[152] First, I agree with Mr Morrison when he submitted that plainly there was a contract between Mr McLanahan, Ms Tan and the firm. That agreement was in the form of the letter of 16 November 2012 from the firm setting out its proposal and its reference to AAS 2011. Mr McLanahan and Ms Tan accepted the firm’s letter of engagement. The agreement was given effect to by Mr McDougall and the firm
providing architectural services and the payment of those services for almost a year. The essence of this aspect of Mr McLanahan’s and Ms Tan’s complaint is that the AAS 2011 terms were not provided until some 10 months after the commencement of the agreement.
[153] When the AAS 2011 terms were provided, the only real issue raised by Mr McLanahan and Ms Tan concerned the level of professional indemnity insurance that was required to be provided.
[154] Regardless of the uncertainty about a specific provision, when it comes to the enforcement of the contract, or to claim damages for alleged breach of the contract, the investigating committee was entitled to conclude the parties had agreed to terms of appointment which enabled Mr McDougall to undertake professional work in accordance with r 50. Rule 50 does not require agreement on all terms. The investigating committee was entitled to conclude that in this case, the essential elements of r 50 had been complied with.
[155] This case is readily distinguishable from The New Zealand Registered Architects Board v Morrison,68 where it was apparent the architect who was the subject of disciplinary proceedings had commenced work for his client in clear breach of r 50.
Unreasonableness
[156] Mr McIntosh properly acknowledged that the submission that the investigating committee’s decisions were, in some respects, unreasonable involved a substantial degree of replication of the submission that the investigating committee’s recommendations were reviewable because it followed a flawed fact-finding process or reached conclusions which were untenable.
[157] It is not necessary for me to repeat what I have previously said about the
cause of action relating to the claim that the investigating committee’s
recommendation was reviewable because of the way the investigating committee
68 The New Zealand Registered Architects Board v Morrison, above n 37.
went about its fact-finding processes or because it reached conclusions that were untenable.
[158] It is sufficient for me to record that having carefully reviewed all of the material that was presented to the investigating committee I am in no doubt that its decision to recommend no disciplinary action be taken against Mr McDougall was one that was reasonably available to it in the circumstances of this case.
Breaches of natural justice
[159] The investigating committee and the Board were required to adhere to the principles of natural justice. This obligation required those entities to follow a fair and reasonable process and to ensure the parties had a reasonable opportunity to be heard. The essence of Mr McLanahan’s and Ms Tan’s complaint is that the investigating committee did not afford them the opportunity to respond to all of Mr McDougall’s submissions and respond to the investigating committee’s own conclusions.
[160] This aspect of the application for judicial review cannot succeed. Mr McLanahan’s and Ms Tan’s complaint and their evidence was considered fully and fairly by the investigating committee. The principles of natural justice do not require an investigating committee to afford the parties the opportunity to respond to every point made by the opposing side, nor was it necessary for the investigating committee to provide Mr McLanahan and Ms Tan with an opportunity to respond to the investigating committee’s conclusions.
[161] The suggestion that the Board had a duty to allow Mr McLanahan and Ms Tan to have the “opportunity to reopen, renew or appeal” the Board’s decision once it was released is also misconceived. It is not surprising that Mr McIntosh did not refer to any authority in support of this argument.
Discretion
[162] Even if I had concluded that the investigating committee and the Board had made reviewable errors I would not have quashed the decisions in question or have directed a reconsideration.
[163] This is a dispute that has had a protracted history. The first time Mr McLanahan’s and Ms Tan’s complaint was assessed by the chairman of the disciplinary committees it was dismissed on the grounds that it was “probably vexatious”. The complaint has now been the subject of a comprehensive investigation by an experienced investigating committee and found to fall short of the threshold required for a disciplinary hearing.
[164] While it is clear that Mr McLanahan and Ms Tan feel deeply aggrieved by Mr McDougall’s services, the disciplinary process does not exist to appease those who are dissatisfied with their architect. The disciplinary process for architects exists to ensure professional standards are maintained in order to protect clients, the profession and the broader community. These objectives would not be served by allowing this dispute to continue.
[165] For these reasons, the application for judicial review is dismissed.
Costs
[166] The first and second defendants are entitled to costs on a scale 2B basis. Those costs are to be apportioned on the basis that the first defendant receives 20 per cent of the costs payable by Mr McLanahan and Ms Tan. Mr McDougall is to
receive the balance.
Solicitors:
Gibson Sheat – Wellington Branch, Wellington for Plaintiffs
Lundons Law, Blenheim for First Defendant
Rainey Collins, Wellington for Second Defendant
D B Collins J
5