National Standards Committee (no 1) of the New Zealand Law Society v X

[2021] NZHC 821

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2021-404-000546

[2021] NZHC 821

UNDER

Section 253 of the Lawyers and Conveyancers Act 2006

BETWEEN

NATIONAL STANDARDS COMMITTEE (NO 1) OF THE NEW ZEALAND LAW SOCIETY

Appellant

AND

X

Respondent

Hearing:

12 April 2021

Counsel:

D La Hood for Appellant

J Long and JK Grimmer for Respondent

Judgment:

19 April 2021

Reissued:

15 June 2021

JUDGMENT OF DOWNS J

(Public version with redactions)

Solicitors/Counsel:

Luke Cunningham Clere, Wellington. Duncan King Law, Auckland.

J Long, Auckland.

JK Grimmer, Auckland.

NATIONAL STANDARDS COMMITTEE (NO 1) OF THE NEW ZEALAND LAW SOCIETY v X [2021] NZHC 821 [19 April 2021]

An appeal with an unusual combination

[1]    X faces eight professional disciplinary charges. The most serious alleges he [engaged in sexual misconduct with] K, a summer clerk. The evidence underlying this charge is hearsay. The New Zealand Lawyers and Conveyancers Disciplinary Tribunal1 ruled the evidence inadmissible at the now-imminent hearing.2

[2]    The National Standards Committee3 appeals this ruling, contending the Tribunal erred to exclude the evidence. The Committee emphasises the protective nature of professional disciplinary regimes, and the difference between criminal proceedings and those here. The Committee contends admission of the evidence would not compromise X’s right to natural justice.

[3]    The appeal has an unusual triumvirate. K is available but is not to be called as a witness. The hearsay evidence is not detailed. And, what amounts to a serious charge could not be sustained without the hearsay.

Background

[4]    X was a partner at a prestigious national law firm. K was a summer clerk with the firm from late 2015 until early 2016. [Redacted].

[5]    On 18 December 2015, the firm had a Christmas party. Charges 1–5 allege at the party, X indecently touched four summer clerks, kissed one and invited another to return home with him.

[6]    On 21 December 2015, X held a team Christmas party at his home. K attended. Alcohol was consumed. X invited the guests to use the pool and sauna. He and K were seen kissing in the latter. The witness reported this to the firm. When questioned by the firm, X and K denied anything happened.

[7][Redacted.]

1      The Tribunal.

2      The hearing is 17 May 2021.

3      The Committee.

[8]    K is not being called as a witness. K has declined to assist the inquiry in relation to X or make any statement. Through counsel, K has said it would be too traumatic to be involved in any way. K was recently asked to confirm the accuracy of the hearsay evidence. She declined to do so.

The charge

[9]The alleged [further sexual misconduct] is captured by charge 7. This reads:

...

[Details of the alleged sexual misconduct have been redacted.] Therefore the Practitioner committed Charge 7 as follows: The Practitioner’s conduct amounted to misconduct.

5.     The Practitioner’s [sexual misconduct] would justify a finding that the Practitioner is not a fit and proper person or is otherwise unsuited to engage in practice as a lawyer because:

5.1The Practitioner was in a position of seniority and/or authority over K in that:

(a)he was a partner at the Wellington Office;

(b)she was a law student working as a summer clerk at the Wellington Office;

(c)[redacted];

(d)she was hoping for an offer of permanent employment at the Wellington Office; and

(e)he had, or would reasonably be understood by her to have, a role in determining whether she received an offer of permanent employment.

5.2The Practitioner was significantly intoxicated [redacted].

5.3K was vulnerable because:

(a)of the power disparity described above at paragraph 5.1;

(b)she was intoxicated; and

(c)she was isolated [redacted].

5.4The Practitioner was aware of the circumstances which rendered K vulnerable.

5.5The Practitioner’s conduct was an abuse of his position of seniority and/or authority.

6.     The Practitioner’s [sexual misconduct] with K was connected with the provision of regulated services, and, in these circumstances, would reasonably be regarded by lawyers of good standing as disgraceful or dishonourable for the reasons given above at paragraph 5.

7.     The Practitioner’s [sexual misconduct] with K in these circumstances consisted of a wilful or reckless violation of r 10 of the Rules because:

7.1For the reasons given above at paragraph 5, the Practitioner’s conduct failed to promote and maintain proper standards of professionalism in his dealings with K.

7.2The Practitioner’s failure to adhere to the standard imposed by r 10 was wilful or reckless.

8.     The Practitioner’s [sexual misconduct] with K in these circumstances consisted of a wilful or reckless violation of r 12 of the Rules because:

8.1For the reasons given above at paragraph 5, the Practitioner did not, while acting in a professional capacity, conduct dealings with others, namely K, with integrity, respect, and courtesy.

8.2The Practitioner’s failure to adhere to the standard imposed by r 12 was wilful or reckless.

In the alternative, the Practitioner’s conduct amounted to unsatisfactory conduct

9.     In the alternative to paragraph 6, the Practitioner’s [sexual misconduct] with K occurred at a time when he was providing regulated services and, in these circumstances, would be regarded by lawyers of good standing as being unacceptable for the reasons given above at paragraph 5.

10.   In the alternative to paragraph 7, the Practitioner’s [sexual misconduct] with K in these circumstances consisted of a contravention of r 10 of the Rules for the reasons given above at paragraph 7.1.

11.   In the alternative to paragraph 7.2, the Practitioner’s [sexual misconduct] with K in these circumstances consisted of a contravention of r 12 of the Rules for the reasons given above at paragraph 8.1.

X’s response

[10]   X has filed a response to the charges. He acknowledges “intimate contact” with K at the team party, including kissing and touching. X says K “instigated” the conduct. He says he ended it the same night, and K “expressed disappointment”.

[11]   X accepts he was less than candid with the firm about K. He says he and K were embarrassed by what happened and agreed to pretend as if nothing had.

[12]   In relation to charge 7, X [denies the alleged sexual misconduct and says that K] “has never, to his knowledge, made any complaint to that effect to anyone at all”.

The hearsay evidence

[13]   The hearsay evidence comes from five then employees [who say K spoke to them about X’s alleged sexual misconduct].

[14][A’s evidence; redacted].

[15][B’s evidence; redacted].

[16][C’s evidence; redacted].

[17][Redacted].

[18][D’s evidence; redacted].

[19][F’s evidence; redacted].

Some preliminary observations about the law

[20]Section 239 of the Lawyers and Conveyancers Act4 provides:

239 Evidence

(1)   Subject to section 236, the Disciplinary Tribunal may receive as evidence any statement, document, information, or matter that may, in its opinion, assist it to deal effectively with the matters before it, whether or not that statement, document, information, or matter would be admissible in a court of law.

(2)   The Disciplinary Tribunal may take evidence on oath, and, for that purpose, any member of the Disciplinary Tribunal may administer an oath.

4      The Act.

(3)   The Disciplinary Tribunal may permit a person appearing as a witness before it to give evidence by tendering a written statement and verifying that statement by oath.

(4)   Subject to subsections (1) to (3), the Evidence Act 2006 applies to the Disciplinary Tribunal in the same manner as if the Disciplinary Tribunal were a court within the meaning of that Act.

(5)   A hearing before the Disciplinary Tribunal is a judicial proceeding within the meaning of section 108 of the Crimes Act 1961 (which relates to perjury).

[21]As is apparent, s 239 is subject to s 236. The latter provides:

236 Rules of natural justice

The Disciplinary Tribunal must, in performing and exercising its functions and powers, observe the rules of natural justice.

[22]   Taken together, these provisions allow the Tribunal to receive evidence that is not admissible under the Evidence Act 2006, provided admission of the evidence would not contravene the rules of natural justice.

[23]   As its name suggests, the Evidence Act contains the primary set of rules by which Courts and Tribunals admit, exclude, and hear evidence. The Act regulates hearsay evidence, more particularly, hearsay statements.5 A hearsay statement is a statement made by a person who is not a witness, and which is offered as evidence to prove the truth of its contents.6 The alleged facts provide an obvious example. K told others X [engaged in sexual misconduct]. K is not a witness. The Committee offers the evidence, in K’s absence, to prove [the sexual misconduct], to sustain the charge he committed misconduct.

[24]   The Evidence Act contains strict rules about hearsay statements. Put very broadly, a hearsay statement is not admissible unless the circumstances relating to the statement provide reasonable assurance the statement is reliable, and the maker of the statement is unavailable as a witness.7 To be unavailable as a witness, the person must be dead; or beyond New Zealand in circumstances in which it is not reasonably

5      Evidence Act 2006, s 18.

6      Evidence Act, s 4(1).

7      Section 18. A hearsay statement is also admissible if the circumstances relating to the statement provide reasonable assurance it is reliable; and undue expense or delay would be caused if the maker of the statement were required to be a witness. No one suggests this exception is applicable.

practicable to be a witness; or unfit because of age or physical or mental condition; or not locatable (with reasonable diligence); or not compellable to give evidence.8

[25]   The key reason for the rules is simple. It can be very difficult to challenge a hearsay statement because the maker of the statement is not a witness. This can compromise the fairness of a proceeding. The exception to the hearsay rule addresses the concern because the statement is sufficiently reliable to be admissible and its maker unavailable as a witness.

[26]   Sections 236 and 239 of the Act are very much like clauses 5 and 6 of Schedule 1 of the Health Practitioners Competence Assurance Act 2003.  Indeed,  Mr La Hood acknowledges in this respect, the two enactments are “materially identical”. As with ss 236 and 239, the clauses allow the Health Practitioners Disciplinary Tribunal to receive evidence inadmissible under the Evidence Act, again provided admission of the evidence would not contravene the rules of natural justice.

[27]   In the recent case of A Professional Conduct Committee of the Nursing Council of New Zealand v Health Practitioners Disciplinary Tribunal,9 the Court of Appeal closely considered clauses 5 and 6. I call the case Nursing Council for ease of reference.

[28]   Nursing Council involved professional disciplinary proceedings against a nurse alleged to have had a sexual relationship with a 14-year-old patient. The Professional  Conduct  Committee   laid   a   charge   of   misconduct   in   the  Health Practitioners Disciplinary Tribunal. The complainant withdrew his support for the charge. The Committee then sought to adduce the complainant’s statements as hearsay statements.

[29]   The nurse asked the Tribunal to exclude the hearsay statements and dismiss the charge for lack of admissible evidence. The Tribunal declined to do either. The nurse judicially reviewed the Tribunal. The High Court held the Tribunal erred in admitting

8      Section 16(2).

9      A Professional Conduct Committee of the Nursing Council of New Zealand v Health Practitioners Disciplinary Tribunal [2020] NZCA 435.

the evidence but declined to dismiss the charge. The Committee appealed, and the nurse cross-appealed. The Court of Appeal dismissed both appeals.

[30]   The Court held the “precise content” of a decision-maker’s natural justice obligations vary according to subject matter.10 When the issue “is the admissibility of hearsay evidence of a complainant … and he is the only witness to the actions complained of ... the assessments called for … will be informed by the important natural justice right to challenge the truth of a complainant’s allegations by asking questions of the complainant in sworn testimony”.11

[31]   The Court said if the Evidence Act test for the admission of hearsay statements is not met, the Tribunal could still admit the evidence, but the related discretion was subject to the “hard limit” of natural justice.12 It followed “the seriousness of the allegation” was an important consideration.13

[32]   The Court added if pivotal hearsay evidence is not admissible under the Evidence Act, “there may be little room to admit [it] ... under the residual discretion”.14 This conclusion followed “from the close link between the natural justice right to challenge one’s accusers and the need to exclude unfairly prejudicial evidence as expressed in s 8(1) and (2)” of the Evidence Act.15 The Court said the Tribunal’s discretion may be broader “in other circumstances”.16

[33]The Court said the “overall effect” was this:17

(a)   That evidence is inadmissible under the Evidence Act does not in and of itself make it inadmissible before the Tribunal.

(b)   Notwithstanding, the Tribunal must consider whether evidence would be admissible under the Evidence Act before considering whether to exercise its discretion under cl 6(1).

10     A Professional Conduct Committee of the Nursing Council of New Zealand v Health Practitioners Disciplinary Tribunal, above n 9, at [36].

11 At [39].

12 At [46].

13 At [46].

14     A Professional Conduct Committee of the Nursing Council of New Zealand v Health Practitioners Disciplinary Tribunal, above n 9, at [46] (emphasis added).

15 At [46].

16 At [46].

17     At [47](a)–(d) (footnotes omitted).

(c)   That general admissibility standard is broad and reflects the principal purpose of the Act, of protecting the health and safety of members of the public by providing for mechanisms to ensure that health practitioners are competent and fit to practise their professions.

(d)   The discretion reflected in that standard is limited by what the Judge referred to as the “hard limit” found in cl 5(3). Moreover, for that discretion to be properly exercised, the Tribunal needs to be aware of, and assess the significance of, the reasons cl 5(3) applies. Hence the importance of a question as to the admissibility of a hearsay statement being assessed by reference to the  relevant  provisions  of  the  Evidence Act, informed by the natural justice interests those provisions reflect, and in the specific context in which the issue arises.

[34]   In summary, the Court of Appeal held the Health Practitioners Disciplinary Tribunal could receive evidence that was not admissible under the Evidence Act, including hearsay statements, provided admission of the evidence did not contravene the “hard limit” of natural justice principles. The Court emphasised those principles involved the right to challenge an accuser, at least when the only evidence came from that person and she, or he, was an available witness.

The Tribunal’s decision

[35]   Citing Nursing Council, the Tribunal concluded the hearsay evidence was not admissible under the Evidence Act because K was available to be called as a witness but not being called.

[36]   The Tribunal then considered whether the evidence should nonetheless be admitted within s 239(1) of the Act. The Tribunal held it should not be:18

[23]   In this case, while we have considerable sympathy for the alleged victim’s position, there is no “compelling reason” why she should be “exempted from giving evidence”, to use the words of Collins J in W. Sadly, there are many cases of sexual abuse that are heard throughout the country every day and, despite the obvious trauma caused to victims, they are expected to give evidence to support the allegations of fact made against an accused person. The availability of alternative means of giving evidence and the ability to have a support person present are intended to protect a complainant as much as possible. We would have had no hesitation in directing that evidence be given in an alternative way, in a closed hearing room and in the presence of a support person.

18     National Standards Committee No 1 v Name Suppressed [2021] NZLCDT 5 at [23]–[25] (footnotes omitted).

[24]     We are also concerned about the nuanced differences in the statements said to have been relayed to the five confidants by the alleged victim. Two of the five confidants do not state precisely what they were told but express their own conclusions about what happened. Evidence such as that could not be admitted on any basis.

[25]    We consider that there is an unacceptable risk that the Practitioner could not meet the specific allegations made against him by the Committee, if one or more of the five confidants gave evidence of what was said to them. There is no statement from the alleged victim to provide a foundation from which the Tribunal could conclude whether what was said to the five confidants was consistent or inconsistent. None of the five confidants have any personal knowledge of what actually took place. There could be no meaningful cross-examination on the question whether [sexual misconduct] took place.

A précis of the Committee’s submissions

[37]   On behalf of the Committee, Mr La Hood makes four interrelated points. First, he observes professional disciplinary proceedings, including those here, protect the public. Such proceedings should not be confused for criminal ones, in which a defendant’s liberty is often at stake. Mr La Hood says the Tribunal wrongly treated the case as if it were criminal in nature.

[38]   Second, Mr La Hood argues natural justice principles are informed by their context, and because this is not a criminal proceeding, X has no unqualified right to be shielded from hearsay evidence, at least when the evidence reaches a threshold level of reliability, even though K is available.

[39]   Third, Mr La Hood says the evidence meets this threshold, particularly as it is called to prove a very simple matter: [redacted]. Mr La Hood observes it is uncontested K was present; that she and X kissed and touched each other in a sexual manner [on the night of the team Christmas party]. Against this background, what K allegedly said to the five witnesses is sufficiently reliable to warrant admission as hearsay evidence. Mr La Hood says the Tribunal failed to conduct a (threshold) reliability-based assessment of the evidence.

[40]   Finally, Mr La Hood contends X would not be prejudiced by the admission of the hearsay evidence, for, he may cross-examine the witnesses about what K told them; identify discrepancies as between K’s accounts; and highlight the hearsay nature of

the evidence as a factor affecting weight. This, Mr La Hood stresses, would better reflect the prophylactic nature of professional disciplinary proceedings.

Analysis

[41]   The Tribunal was obliged to assess the admissibility of the hearsay statements in accordance with the decision of the Court of Appeal in Nursing Council. The Tribunal was thus obliged to consider the seriousness of the allegation against X, and whether admission of the hearsay statements would contravene the rules of natural justice vis-à-vis the allegation. The mix addresses Mr La Hood’s first and second submissions; the Tribunal did no more than apply Nursing Council to this case.

[42]   Mr La Hood submits Nursing Council is distinguishable, for, the allegations against the nurse were little short of criminal, whereas charge 7 “only” alleges [sexual misconduct]. So, this case is a professional disciplinary matter only, not a criminal case in the guise of a professional disciplinary one.

[43]   The first answer to the submission is charge 7 itself. The charge alleges X had a position of authority over K; that K was vulnerable by reasons of “power disparity”; intoxication; and isolation […]; and that X “was aware of the circumstances which rendered K vulnerable”. On one view, the charge is not much removed from an allegation of […] a very serious criminal offence.19

[44]   The next answer is that even if [that] analogy is misplaced, the charge is self-evidently serious. In fairness, Mr La Hood does not argue otherwise.

[45]   The remaining answer is that s 236 of the Act requires the Tribunal to observe the rules of natural justice, including, given the facts, the rule emphasised by the Court of Appeal in Nursing Council, the right to challenge an accuser.20 Again, the Tribunal did no more than apply that case to this one.

19     [Redacted.]

20     Section 27(1) of the New Zealand Bill of Rights Act 1990 also affirms “the right to the observance of natural justice by any tribunal”.

[46]   Mr La Hood contests the applicability of this reasoning. He argues the accuser is the Committee, not K. Mr La Hood notes K has never complained formally about

X. It follows K is not a complainant.

[47]   These arguments are technically correct, but the point goes nowhere. K is the maker of the hearsay statements—the person saying to the witnesses—X [engaged in sexual misconduct]. The concept of an accuser is not confined to a complainant or victim; the idea is that the person facing the allegation should be able to test the account of the person who made the allegation, at least when that person is available as a witness.

[48]   Mr La Hood’s third submission overlooks the significance of the unavailability criterion in the Evidence Act’s exception to the hearsay statement rule. It is not enough that the circumstances relating to the statement provide reasonable assurance of its reliability; the maker of the statement must also be unavailable. These requirements are conjunctive, not disjunctive, and Courts have interpreted the unavailability criterion cautiously. For example, in R v Alovili, an eyewitness with a mental illness was held not to be unavailable even though the stress of testifying would likely aggravate his illness.21 It is thus unsurprising the Tribunal said little about reliability, for, even if that criterion were satisfied, it was common ground K was available as a witness.

[49]   In any event, the reliability criterion is not satisfied in relation to K’s statements to F and D. K did not tell F what the “it” referred to.  Context does not fill the gap.  D does not report what K said. Rather, she offers her opinion of what K was conveying. Mr La Hood responsibly acknowledged these shortcomings but emphasised the reliability of K’s statements to the remaining witnesses. He stressed the simplicity of the fact to be established by the evidence: [redacted].

[50]   Reliability in this context typically includes an assessment of the nature of the statement; its content; the circumstances relating to the making of the statement; the

21     R v Alovili HC Auckland CRI-2007-404-162, 27 June 2008.

veracity of the maker; and “any circumstances that relate to the accuracy of the observation of the person”.22 The assessment is a threshold one only.23

[51]   K’s statement to each witness is informal. The circumstances in relation to the making of each suggests the imparting of a confidence with associated distress. But, what K actually said—as against what each witness established or understood K to say—is unclear. A refers to “the gist” of what K said; C refers to getting “only half the information”, and to difficulty in establishing what K was saying; and B says K referred to [redacted]. Relatedly, the statements are not detailed. They are more allegation than narrative. While this is often true of sexual cases—rarely does a victim give a confidant much detail about what happened—the difficulty here is that the alleged victim is not a witness, hence there is no narrative. Importantly, the only evidence of [the alleged sexual misconduct], as against intimate touching and kissing [on the night of the team Christmas party], is the hearsay evidence.24

[52]   Mr La Hood contends there is no reason to believe K has been anything other than honest about X. This may be correct, but as observed, K has declined, through counsel, to confirm the accuracy of what she said to the witnesses.

[53]   Given this mix, K’s hearsay statements to A, B and C do not meet the reliability criterion either.

[54]   This conclusion makes it unnecessary to address Mr Long’s detailed submissions about the statements on behalf of X, or whether significance attaches at this (threshold) juncture to an apparent inconsistency [redacted].25

[55]   The same conclusion addresses Mr La Hood’s final submission that X would not be prejudiced by the admission of the hearsay evidence. I agree with the Tribunal there is an obvious, unacceptable risk he would.

22 Evidence Act, s 16(1), “circumstances”.

23 Adams v R [2012] NZCA 386.

24 Mr La Hood argues events at the earlier party and the acknowledged intimacy provide some  support for the charge. I am inclined to agree. However, the hearsay evidence remains the only evidence of [the alleged sexual misconduct]. It is pivotal of charge 7.

25 [Redacted].

A final observation

[56]   This case’s broader orbit has attracted public attention. The attention has extended to whether Courts and other institutions are sufficiently conscious of the rights of victims in sexual cases. The debate is important, and welcome. That said, the Tribunal was bound to apply existing law in determining whether K’s hearsay statements are admissible. Its conclusion they are not is orthodox given the case’s unusual triumvirate: an available witness; hearsay evidence lacking detail; and a serious charge reliant on hearsay.

[57]The appeal is dismissed.

Suppression orders

[58]   Lang J made a suite of interim suppression orders 1 April 2021. I affirmed these at the hearing as a media representative was present. The (interim) orders are:

(a)An order suppressing the names and identifying details of all alleged victims named in the charges and secondly of those witnesses who might lead to identification of the alleged victims, namely witnesses 5, 9, 10 and 12 on the witness schedule.

(b)An order prohibiting publication of X’s name or identifying particulars of his affairs in connection with this proceeding until non-publication is finally determined in the Tribunal (including the grounds for and evidence in support of his application for non-publication).

(c)A suppression order pending commencement of the Tribunal hearing of any details of charge seven, save that they involve allegations of sexual misconduct at Russell McVeagh functions held some years ago.26

(d)An order that no third parties be permitted to access the court file without leave of the Court.

26     I have not referred to the firm by name, but Lang J did not suppress it. Hence reference to it here.

[59]   This judgment has been anonymised. It may be reported in a law report, legal digest, or the like.

Costs

[60]   X said he wished to be heard on costs. I invite memoranda of not more than six pages:

(a)X on or before 4 May 2021.

(b)National Standards Committee on or before 11 May 2021.

……………………………..

Downs J