Zhao v Legal Complaints Review Officer

[2016] NZHC 2758

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2016-404-000708 [2016] NZHC 2758

UNDER THE

Judicature Amendment Act 1972, Part 30

of the High Court Rules, New Zealand Bill of Rights Act 1990, and the Declaratory Judgments Act 1908

IN THE MATTER

of an application for judicial review

BETWEEN

RICHARD ZHAO Plaintiff

AND

THE LEGAL COMPLAINTS REVIEW OFFICER

First Defendant

SURONG LI Second Defendant

NEW ZEALAND LAW SOCIETY Intervener

Hearing:	20 October 2016
Counsel:	F Deliu for Plaintiff M Hodge for Intervener
Judgment:	17 November 2016

JUDGMENT (2) OF FOGARTY J

This judgment was delivered by Justice Fogarty

On 17 November 2016 at 3.00pm Pursuant to r 11.5 of the High Court Rules Registrar/Deputy Registrar

Date:…………………………

Solicitors/counsel:

F C Deliu, Auckland/Amicus Lawyers

Whitfield Braun Ltd, Auckland
Crown Law, Wellington

Meredith Connell, Auckland

ZHAO v THE LEGAL COMPLAINTS REVIEW OFFICER [2016] NZHC 2758 [17 November 2016]

[1]      The plaintiff applies to recall my judgment in this matter delivered on 2

November 2016.1  The application is on two bases:

(a)       That I did not adjudicate on paragraph [11](1)(k) of the Statement of

Claim; and

(b)      That there no basis to award the LCRO costs.

[2]      Paragraph [11](1)(k) of the Statement of Claim was directed to the finding by the Standards Committee that the failure of the solicitor to provide the client with a letter of engagement for some considerable period of time, while incurring fees to the value of $10,000, was a clear breach of r 3.4 of the Rules of Conduct and Client Care and constituted unsatisfactory conduct.

[3]      The Standards  Committee  did  not  refer the matter to  the Tribunal  for a potential finding of misconduct.  Obviously one of the reasons why it did not is that the solicitor in due course wrote off his costs engaged prior to providing the letter of engagement.    It  is  correct  that  the  decision  of  the  High  Court  rejecting  the application for judicial review did not address the criticisms of this finding of unsatisfactory conduct.  These criticisms were as pleaded that the LCRO was in error of law  in  upholding  the Standards  Committee’s  decision  in  failing  to  take into account that:

(a)       Not every breach of the rules warrants a disciplinary black mark;

(b)That the retainer was paid after the letter of engagement, so the client was not prejudiced; and

(c)       That the solicitor in due course wrote off all the work done before the terms of engagement had been provided.

[4]      The first of these three points is an elementary one which does not need to be stated by the LCRO upon review.

[5]      The second and third points were matters of fact.  It is true that they were not recorded in paragraphs [64] to [69] but, as those very paragraph numbers reflect, the LCRO got to that issue well into the judgment and after an extensive statement of the background of events.  The LCRO also got to the issue after in paragraphs [58] to [63], making some trenchant criticisms of the submission by Mr Deliu that the solicitor’s conduct could be mitigated by an argument of honest mistake.   That argument was hopeless on the facts because there was not one error in depositing the funds, it was a fact that the funds moved through several personal family accounts.  I did not think that there is any merit at all in the proposition that the LCRO could be reviewed for leaving in place the Standards Committee’s finding of unsatisfactory conduct.   There was no failure to take into account relevant considerations.   My judgment focused on the more significant decision of the LCRO to leave in place the recommendation of the reference by the Standards Committee of the mis-banking of the retainer for the Disciplinary Tribunal.  Were I to recall the judgment, all I would be doing is inserting the reasons I have just set out in this judgment.  It would make no difference to the outcome.

[6]      The second ground for recall is there is no basis to award LCRO costs.  Costs follow the event in the normal course.  There is no preliminary requirement to give parties an opportunity to be heard on the matters of costs.  It is frequently the case that costs are automatically awarded.   There are other cases where the Judge, uncertain about costs, calls for submissions and/or sometimes a hearing.  It is not a basis for judicial review.   I am not aware of any decision in which a High Court judgment has been recalled in respect of a costs award, on the basis that there was not provision  for a hearing on  the matter.    See as  an  instance of longstanding

practice, the Supreme Court’s decision in Rafiq v Google New Zealand Ltd.2

[7]      The application for recall is dismissed.

Fogarty J