Parmenter v Legal Complaints Review Officer

[2021] NZHC 2025

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2020-404-000687

[2021] NZHC 2025

UNDER

the Judicial Review Procedure Act 2016

IN THE MATTER

of an application for review

BETWEEN

RAYMOND OWEN PARMENTER
Applicant

AND

LEGAL COMPLAINTS REVIEW OFFICER

First Respondent

NEW ZEALAND LAW SOCIETY

Second Respondent (appearing as contradictor)

CLEMENT CATTELL

Third Respondent

Hearing:

25 February 2021

Subsequent submissions: 1 March and 4 March 2021

Appearances:

WA McCartney for the Applicant SM Earl for the Respondents

Judgment:

6 August 2021

JUDGMENT OF HINTON J

This judgment was delivered by me on Friday, 6 August 2021 at 9 am

pursuant to r 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Solicitors/Counsel:

Daniel Overton & Goulding, Auckland. Meredith Connell, Auckland.

WA McCartney, Barrister, Auckland.

PARMENTER v LEGAL COMPLAINTS REVIEW OFFICER [2021] NZHC 2025 [6 August 2021]

[1] Mr Parmenter applies for judicial review of a decision of the Legal Complaints Review Officer (LCRO) which in essence upheld a decision of the Auckland Standards Committee, finding that certain conduct of Mr Parmenter amounted to unsatisfactory conduct under the Lawyers and Conveyancers Act 2006 (the Act). The Committee imposed a fine of $2,000 and costs of $1,000. The penalty and costs were confirmed by the LCRO.

[2]    Mr Parmenter seeks an order setting aside the findings of the LCRO and the Committee on the basis that the decision was wrong in law and that the decision is unreasonable.

[3]    The decisions resulted  from  a  complaint  by  Mr  Cattell  arising  out  of  Mr Parmenter acting for a trust of which Mr Cattell was a trustee. The trust was involved in proceedings against Auckland Council regarding earthworks undertaken by the Council which allegedly caused damage to the trust’s adjoining property.

[4]    Mr Parmenter was the third solicitor to act in the proceeding. The first solicitor ceased to act for unknown reasons. The second solicitor died. Mr Parmenter took over the file on 27 May 2015. Mr Parmenter ceased to act on 20 April 2016 after he and Mr Cattell had fallen out.

[5]    Mr Cattell’s complaint was dated 28 December 2017 and filed on 8 January 2018. It related to a number of allegations of incompetence and untruthfulness. The only matter that was upheld was a complaint about Mr Parmenter’s approach to discovery by the Council. The Committee found this was unsatisfactory conduct under s 12(a) of the Act. The LCRO narrowed that finding to a lack of diligence constituting unsatisfactory conduct.

Background

[6]    The matter was complicated by the fact that both Mr Cattell and Mr Parmenter had computer problems and had lost their emails from the relevant time period. The timeline as set out below is drawn as best as possible from the documents that are available, particularly a letter from Mr Cattell to Mr Parmenter dated 29 March 2016,

the letter of complaint filed by Mr Cattell dated 28 December 2017, Mr Parmenter’s time records and Court documents.

[7]    The order for discovery at the centre of this case was made by Associate Judge Sargisson on 11 February 2015, requiring both parties to file and serve verified lists of documents by 9 April 2015.

[8]    As already noted, Mr Parmenter was instructed on 27 May 2015 following the death of previous counsel. Almost immediately after being instructed he became very unwell and in fact was diagnosed, as evidenced by a medical certificate dated 2 June 2015, with pneumonia. This took him out of action until he departed on 12 June 2015 on a pre-arranged trip to France.

[9]    On 12 July 2015, Mr Parmenter returned from France and on 17 July, very shortly after his return, he and Mr Cattell carried out a site inspection of the relevant properties and earthworks.

[10]   On 29 July 2015, Mr Parmenter commenced drafting a brief of evidence for Mr Cattell, and on 6 August he commenced drafting an amended statement of claim. In the first half of August  2015,  according  to  Mr  Cattell’s  letter  of  complaint, Mr Parmenter raised with Heaney and Partners, the Council’s solicitors, the Council’s lack of compliance with the discovery order.

[11]   On 17 August 2015, Heaney and Partners acknowledged delay on the part of the Council and later that month delivered the Council’s affidavit of documents. It seems (oddly) that had been completed a few months before.

[12]On 25 August 2015, Mr Parmenter completed the amended statement of claim.

[13]   In September 2015, Mr Parmenter advised the Council’s solicitor of deficiencies in discovery. According to Mr Parmenter’s timesheets, there were a number of telephone calls and emails regarding discovery between October and December 2015.

[14]   Mr Cattell had taken responsibility for a close study of the Council’s discovery. On 16 November 2015, Mr Parmenter emailed him, clearly trying to move him along with his analysis. He said: “This is getting a bit urgent. We have a close of pleadings date of 18 December and I would really like to know WTF before then”.

[15]   On 24 November  2015  Mr  Cattell  provided  an  eight-page  analysis  to  Mr Parmenter. It was clear from that and later letters that Mr Cattell, who is a forensic investigator, was very well informed about the proceeding and the Court process. That same day, Mr Parmenter again advised Heaney and Partners of deficiencies in discovery and forwarded a version of Mr Cattell’s analysis to them. Around that time he arranged for a meeting with the lawyer from Heaney and Partners, which was aborted due to her having double-booked.

[16]   On 17 December 2015, Mr Parmenter and Heaney and Partners filed a joint memorandum in which Heaney and Partners conceded deficiencies in their discovery. They sought a pre-trial conference in January 2016 and an extension of the close of pleadings date. This led Associate Judge Sargisson to allocate a call in the Chambers List on 19 February 2016 and to extend the close of pleadings date to then. The matter was set down for hearing on 18 July 2016.

[17]   There was a second delivery of documents by the Council just before Christmas 2015, this presumably following the conceded deficiencies. Mr Parmenter sent that immediately to Mr Cattell for analysis pursuant to their arrangement.

[18]   On 19 February 2016 there was a further Chambers mention, the result of which is unclear.

[19]   On 18 March 2016, the Council filed and served a second affidavit of documents apparently relating to the document  delivery  that  Mr  Parmenter  and Mr Cattell had received just before Christmas 2015. On 23 March Mr Parmenter spent considerable time working on the file.

[20]   There had been updating communications  from  Mr  Cattell,  including  on 10 February when he advised of his intention to send his worksheet amalgamation of

discovery shortly. But it was not until 29 March 2016, that Mr Cattell provided his second detailed analysis of discovery to Mr Parmenter along with a cover letter. It did not emerge from Mr Cattell’s letter that in his view (and although not the lawyer in charge as I have said he was well informed) Mr Parmenter needed to immediately pursue further discovery. Mr Cattell was critical of the Council’s discovery, particularly in respect of the form (or lack of form) it had taken. But, he said, “the facts can speak for themselves” and that he was developing Mr Parmenter’s fourth version of his  brief based on a list  of  documents he had  drawn up.  I agree with  Mr McCartney, for Mr Parmenter, that comments in Mr Cattell’s letter suggest that his primary concern was over lateness in terms of finalising his brief. He runs through what can be said about the Council’s discovery process for purposes of “arse covering” in this regard.

[21]   There were various telephone calls  and  emails  between  Mr  Cattell  and  Mr Parmenter and on 16 April 2016 further lengthy attendances reviewing the evidence.

[22]   Then on 18 April 2016 there is a further letter from Mr Cattell to Mr Parmenter which has a sharp change in tone. He criticises Mr Parmenter’s approach to analysis of the evidence. It seems he was very unhappy with the draft brief that had been provided to him by Mr Parmenter. It is fairly clear from that note that by this stage they have had significant differences of opinion. Two days later, on 20 April 2016, Mr Parmenter emails Mr Cattell saying he cannot continue as counsel due to a “mutual loss of confidence and breakdown in [their] relationship”. Oddly, it seems Mr Cattell then tried to insist that Mr Parmenter continue to act but on 6 May 2016 Heath J recorded in a Minute that he accepted Mr Parmenter’s reasons for withdrawing as counsel. As a consequence, the trial date was vacated and a new date allocated.

[23]   On 8 January 2018, Mr Cattell filed his complaint which as noted raised a range of allegations but only the charge of failing to pursue discovery in a timely way was ultimately upheld by the LCRO.

Decision of the Standards Committee

[24]The Committee found as follows:

(a)It was common ground that the Council had not provided complete discovery in accordance with the Court order made in February 2015, this  having  been  recorded  in  the  joint  memorandum   filed  by   Mr Parmenter and Heaney and Partners;

(b)Mr Parmenter deferred to Mr Cattell too much, to the point that he overlooked his own responsibilities as far as discovery was concerned. It was ultimately Mr Parmenter’s role to take all reasonable steps to ensure compliance by the Council with the February 2015 discovery order;

(c)Mr Parmenter should have taken active steps to request further discovery when Mr Cattell advised him on 12 and 22 September 2015 that the first tranche of discovery provided by the Council was deficient. There was no evidence that he took any steps to pursue the matter when Mr Cattell raised concerns  again  in  November 2015. Mr Parmenter also appeared to have taken no action when Mr Cattell identified the second tranche of documents, delivered in December 2015, as being deficient;

(d)Mr Parmenter could, and should, have been more proactive in pursuing discovery from the Council. It would “doubtless” have assisted in obtaining better discovery if he had “vigorously pursued” the issue with the solicitors for the Council; and

(e)By failing to pursue discovery in any meaningful way, and by failing to prioritise the matter, Mr Parmenter breached his professional obligations under r 3 of the Lawyers and Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008 (Conduct and Client Care Rules), in a manner which amounted to unsatisfactory conduct under s 12(c) of the Act. His failures in this regard also fell short of the standard of competence and diligence that a member of the public is entitled to expect of a reasonably competent lawyer, and therefore constituted unsatisfactory conduct in terms of s 12(a) of the Act.

Decision of the LCRO

[25]The LCRO:1

(a)Agreed with the Committee’s finding that it was for Mr Parmenter to take all reasonable steps to ensure compliance with the February 2015 discovery order.

(b)It also agreed with the Committee that  there was  no  evidence that Mr Parmenter took any steps to pursue the matter with the solicitors for the Council either following delivery of the first tranche of documents, or the second.2

[26]The LCRO further observed:

(a)there would have been grounds for an application to the Court for further and better discovery, which would have “demanded far more respect from the Council than Mr Parmenter’s letters”;3

(b)after the significant and exhaustive efforts that Mr Cattell had made to examine the documents discovered by the  Council,  and  to  advise Mr Parmenter of the shortcomings of the discovery, Mr Cattell was entitled to expect that Mr Parmenter would take steps to have that rectified;4 and

(c)a member of the public could have expected Mr Parmenter to write a letter to Heaney and Partners before he departed overseas (even taking note of Mr Parmenter’s ill-health) and then, on his return, to apply to the Court to have the defects in discovery rectified.5

1      Cattell v Parmenter [2020] NZLCRO 59.

2 At [78].

3 At [82].

4 At [84].

5 At [85].

[27]   The LCRO found those shortcomings to be more appropriately categorised as a lack of diligence, rather than incompetence, and modified the Committee’s finding by focussing on that part of the definition of unsatisfactory conduct in s 12(a) of the Act.6

Relevant statutory law

[28]Section 12(a) of the Act provides:

12Unsatisfactory conduct defined in relation to lawyers and incorporated law firms

In this Act, unsatisfactory conduct, in relation to a lawyer or an incorporated law firm, means—

(a)conduct of the lawyer or incorporated law firm that occurs at a time when he or she or it is providing regulated services and is conduct that falls short of the standard of competence and diligence that a member of the public is entitled to expect of a reasonably competent lawyer; or

[29]Rule 3 of the Conduct and Client Care Rules provides:

3     Rules of conduct and client care for lawyers

Every lawyer must comply with the rules of conduct and client care for lawyers set out in the Schedule.

[30]   The Schedule provides, inter alia, that a lawyer must act competently and in a timely way and in accordance with instructions received and arrangements made.

[31]   Competence in the context of s 12(a) relates to knowledge of subject matter where diligence relates to procedural timeliness.

[32]   Section 12(a) does not require a high standard of competence or diligence. The duty is in reality a duty not to be incompetent, or lacking in diligence. The Conduct and Client Care Rules are aimed at ensuring minimum standards of service.7

6      Cattell v Parmenter, above n 2, at [86].

7 Lawyers and Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008, preface.

Discussion

Error of law as to finding of obligation to enforce

[33]   Mr Parmenter contends, first, that the LCRO (and the Committee) erred in law in finding that he had a duty or obligation, independent of his instructions, to enforce the discovery order against the Council and that the Committee confused the position of a lawyer pursuing discovery from another party, to that of a lawyer having to see to proper discovery from his own client.

[34]   I can see nothing in either decision that suggests the decision-maker was confused with the obligation a lawyer has to the Court when their own client is making discovery. Furthermore, I do not agree with the applicant that a lawyer for the party who has the benefit of an order for discovery has no obligation independent of specific instructions to enforce the order. The lawyer does not have to, at least as a general rule, take enforcement action immediately on breach of a discovery order made in favour of their client. But, they do have a duty to see to it that discovery is properly and efficiently completed for the benefit of their client, just as they do with any step in litigation. A lawyer does not have to wait for instructions from a client to “enforce” an order (using the word in its broadest sense) but rather should be advising the client as to what is required and/or what options are available and implementing the consequential instructions. To the extent Mr Parmenter submits otherwise, I disagree.

Does s 12(a) require incompetence and lack of diligence?

[35]   The second ground of review was raised only at the outset of the hearing by Mr McCartney, for Mr Parmenter. As noted above, the LCRO concluded that this was a case not of incompetence but rather lack of diligence. Mr McCartney submitted that s 12(a) of the Act requires both incompetence and a lack of diligence. He says that on the face of the LCRO finding, the requirements of the section are therefore not met and the complaint should have been dismissed.

[36]   This argument is neatly answered, as Mr McCartney fairly observed in his post- hearing memorandum, by Handley AJA in the New South Wales Court of Appeal in Fitzgibbon v Council of New South Wales Bar Association when he said:8

Parliament cannot have considered that either diligent incompetence or

dilatory competence was satisfactory professional conduct. (emphasis added)

[37]   The relevant provision in the New Zealand legislation is the same as that referred to by Handley AJA.

[38]   Mr McCartney accepts, on the strength of the statement quoted above, that unsatisfactory conduct can comprise either lack of competence or lack of diligence.

Wednesbury unreasonableness

[39]   As a third ground, the applicant submits that the conclusion of the LCRO (and therefore the Committee) is erroneous in law because of Wednesbury unreasonableness. To be satisfied that the decision is unreasonable in this sense, I have to find, to adopt the language used by Palmer J in Hu v Immigration and Protection Tribunal, it is so insupportable or untenable that proper application of the law requires a different answer.9

[40]   I find for the applicant on this ground. The Committee and the LCRO had to be satisfied that there was a lack of diligence. This does not involve holding the practitioner to a high standard. The Committee and the LCRO provided somewhat different reasons for their conclusions, but I consider the reasons do not support a finding of a lack of diligence.

[41]In terms of the key reasons:

(a)The Committee was wrong to say  (and  the  LCRO  to  agree)  that Mr Parmenter had not taken active steps to pursue the discovery issue following hearing from Mr Cattell in September 2015 and in November

8      Fitzgibbon v Council of New South Wales Bar Association [2011] NSWCA 165 at [16].

9      Hu v Immigration and Protection Tribunal [2017] NZHC 41, [2017] NZAR 508 at [2].

2015. In fact, Mr Parmenter had advised Heaney and Partners of deficiencies  in  discovery  in  September  2015,  as  referenced  in  Mr Cattell’s own letter, and he had done so again in November 2015 after receiving Mr Cattell’s first analysis. He had also arranged a meeting with Heaney and Partners which did not take place through no fault of his own, but then nonetheless had some effective communication with  them  leading  to  the  joint  memorandum  of  17 December 2015 and the provision of further discovery just before Christmas  2015.  There  had  been  a  number  of  attendances  on   Mr Parmenter’s part in addition to those mentioned. The findings and evidence do not support a finding of lack of diligence down to the end of 2015.

(b)The Committee was also wrong to say that Mr Parmenter had taken no action when Mr Cattell identified the second tranche of documents as being deficient.  Mr  Cattell  did  not  complete  that  exercise  until  29 March 2016.  Mr  Parmenter  spent  considerable  time  both  on  23 March and 16 April reviewing the evidence. Further, Mr Cattell and Mr  Parmenter  fell  out  shortly  afterwards  over  the  drafting  of   Mr Cattell’s  brief   and   Mr   Parmenter   withdrew   as   counsel.   Mr Parmenter cannot be said to have taken no action in that short period.

[42]   In terms of the remaining relevant period, which is between Christmas 2015 and 29 March 2016, there is no express finding. During that period Mr Cattell was conducting an analysis of the second tranche of discovered documents. As the Committee said Mr Cattell had insisted on a high degree of involvement. He clearly had a very good understanding of the facts and the documents that enabled him to do that. As the Committee also found there was nothing inappropriate about Mr Cattell taking on that role. As a general rule though, a lawyer is obliged to see to it that a document review is completed in a timely manner either by the client, or failing that, by themselves. Mr Cattell took longer than he expected, or told Mr Parmenter he would, to conduct his second analysis. Mr Parmenter had previously pointed out the need for urgency. It is clear from Mr Cattell’s own letters that he knew of the timetable

and the  significance  of  it.  He  had  a  lawyerly  grip  on  the  proceeding.  While Mr Parmenter arguably should have done more in February/March 2016 to push    Mr Cattell along, it cannot be said in the circumstances of this retainer and the arrangements made, that he fell short of a minimum standard of diligence regarding the discovery process.  Nor,  significantly, given his high level of knowledge, did   Mr Cattell suggest any shortcoming on Mr Parmenter’s part in his letter of 29 March 2016.

[43]   Further, immediately before and shortly after Mr Cattell provided his second analysis, Mr Parmenter spent considerable time in preparation, considering the brief and the documents. Had he and Mr Cattell identified further documents that were in fact required by them, there was still time to either obtain such documents from the Council or file an application for further discovery given the Council’s failures. But the relationship ended.

[44]In terms of the additional “reasons” provided by the LCRO:

(a)I disagree that Mr Parmenter was obliged in terms of the Act or otherwise to write to Heaney and Partners regarding discovery when he was first instructed, given the combined circumstances of his acute ill- health and his immediate departure thereafter for France. I consider that is too rigorous a standard, to the extent of being unreasonable, especially in circumstances where the hearing was still a year away. It does not amount to a lack of diligence to have not written such a letter.

(b)Mr Parmenter, as the LCRO held, could have filed an application in Court for further and better discovery on his return from overseas in July 2015, but there was no obligation that he do so. In fact, it would not even be typical to do so at that point. Normally it would be expected that a party like the Council would comply with its discovery obligations. Mr Parmenter was in liaison with Heaney and Partners and the Court regarding discovery shortly after his return from overseas which led to two tranches of documents being provided and two affidavits filed.

(c)Mr Parmenter did take steps to advise Council of the shortcomings in discovery following the first tranche of documents. As already noted, he was working on the evidence shortly after receiving Mr Cattell’s letter of 29 March 2016. Very shortly after that, the two fell out over Mr Cattell’s brief.

[45]   I consider that the LCRO’s decision (and therefore the Committee’s determination on which it is based) is unreasonable in Wednesbury terms. I would add that I agree with the Committee and LCRO that Mr Parmenter’s conduct of the proceedings was not vigorous enough. He was too passive, especially for proceedings of this nature. He was “allowing” his client to have too much control.10 But I do not consider any of the reasons or the evidence supports a finding of unsatisfactory conduct based on a lack of diligence with regard to discovery.

Conclusion

[46]The application for judicial review is granted.

[47]   The findings of the LCRO (and of the Standards Committee) that the applicant was guilty of unsatisfactory conduct are set aside and the fine and costs order are quashed.

[48]   As to costs, I have decided that costs are to lie where they fall. Although there is ultimately no breach, for the reasons I have indicated immediately above, and because the respondent is a disciplinary body properly fulfilling a public role, I consider a costs award inappropriate.

[49]   This decision is not to be published for 10 working days to allow the parties an opportunity to make submissions as to suppression or otherwise and if so of what particulars. Hopefully this will be by joint memorandum.

Hinton J

10     As further examples, Mr Parmenter complained that Mr Cattell had insisted on claiming $130,000 exemplary damages against his advice and similarly was refusing to engage experts.