Zhao v Legal Complaints Review Officer

[2013] NZHC 1052

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2012-404-002533 [2013] NZHC 1052

UNDER  the Judicature Amendment Act 1972

IN THE MATTER OF     an Application for Judicial Review

BETWEEN  RICHARD ZHAO Plaintiff

ANDTHE LEGAL COMPLAINTS REVIEW OFFICER

First Defendant

AND  YU NIE

Second Defendant

Hearing:         On the papers

Counsel:         F C Deliu for the Plaintiff

P Collins for the First Defendant
Y Nie in person

Judgment:      10 May 2013

JUDGMENT OF WOOLFORD J

(Costs)

This judgment was delivered by me on Friday, 10 May 2013 at 4:00 pm pursuant to r 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Solicitors/Counsel:

F C Deliu, PO Box 68559, Newton, Auckland 1145. P Collins, PO Box 4338, Auckland 1140.

Alice Lawyers (A Y Nie), PO Box 77101, Mt Albert, Auckland.

ZHAO V THE LEGAL COMPLAINTS REVIEW OFFICER & ANOR HC AK CIV-2012-404-002533 [10 May

2013]

[1]      In a judgment dated 4 December 2012, I allowed an application to review the decision of a Legal Complaints Review Officer to remit a complaint which had been dismissed back to the Auckland Standards Committee for reconsideration.  I quashed the decision to remit the complaint back and directed that the complaints process in respect of the second defendant’s complaint against the plaintiff be stayed.

[2]      I  stated  that  if  the  parties  wished  to  seek  costs  then  I  would  receive memoranda.  I noted that the first defendant took no steps and abided the decision of the Court.  I noted that the second defendant also took no steps and abided the decision of the Court and that I did not accept that her complaint against the plaintiff or her initial application to review the dismissal of her complaint was in any way made in bad faith.  Finally, I recorded the advice of plaintiff’s counsel that he had no intention to seek costs against the New Zealand Law Society as intervener given its limited role.

[3]      The plaintiff now seeks costs against both the first and second defendants.

[4]      There are two issues.  First, can costs be awarded against the first defendant as a quasi-judicial officer?  If so, should such an order be made?  Secondly, should the second defendant, who was automatically joined to the judicial review proceedings, have a costs order made against her?

Plaintiff ’s Submissions

[5]      The plaintiff submits that both  the first defendant, the Legal Complaints Review Officer (LCRO), and the second defendant, Ms Nie, should have costs ordered against them.  The plaintiff accepts there is no proper basis to order costs against the intervener, the New Zealand Law Society.

[6]      The  plaintiff  submits  the  LCRO  should  have  costs  awarded  against  her because if the LCRO had exercised basic diligence the proceedings would not have been necessary.  The plaintiff contrasts the LCRO’s conduct in the present case with

her  conduct  in  U v Legal  Complaints  Review  Officer1   where  she  acknowledged making a procedural error.   He puts that forward as evidence that in this case an award of costs would be appropriate.

[7]      The plaintiff submits that due to the LCRO’s conduct, the fact that she abided the decision of the Court should not be taken into account.

[8]      The plaintiff also submits that costs should be awarded against Ms Nie as she was  at  fault  for  failing  to  provide  professionally  translated  copies  of  Chinese language posts by the plaintiff on the Skykiwi forum and not filing a proper review application or proper submissions in a hearing in December 2011.  The plaintiff submits that if the second defendant had presented her case for review properly the LCRO may not have made her error.

First Defendant’s submission

[9]      The LCRO submits she should not be held liable for costs.  She submits that costs cannot be awarded against a decision-maker except in the cases of perversity, oppression or bad faith.  Because the LCRO is a decision maker, this principle accordingly applies.

[10]     The LCRO points to the fact the plaintiff withdrew causes of action alleging that she acted in bad faith as evidence that her conduct does not meet the threshold required for costs to be awarded against a decision-maker.

Second Defendant’s submission

[11]     Ms Nie submits that she was required to be joined in the proceedings as she filed the complaint.  This was beyond her control and accordingly she should not be required to pay costs.  She rejects the plaintiff ’s submission that she was required to provide a professional translation and submits that there are no grounds to suggest that she failed to present her case appropriately.

The first defendant’s liability for costs

[12]     In The Coroner’s Court v Newton the Court of Appeal states:2

Costs will only be awarded (even in judicial review proceedings) against judicial officers such as Justices or Coroners in the rarest of circumstances when such a judicial officer has done something which calls for strong disapproval. It is certainly not the practice to grant costs against Justices or a Coroner merely because that person has made a mistake in law. It must be shown that the judicial officer concerned has acted perversely, oppressively or in bad faith.

[13]     In Siemer v District Council at North Shore3 Lang J held that Justices of the Peace as an institution were judicial officers who were immune from costs awards unless they had acted perversely, oppressively or in bad faith.  He cited the case of R v Liverpool Justices in which it was stated:4

It has been the practice not to grant costs against justices or tribunals merely because they have made a mistake in law, but only if they have acted improperly,  that  is  to  say  perversely  or  with  some  disregard  of  the elementary principles which every court must obey and only then if it was a flagrant instance.

[14]     The relevant question in relation to the LCRO is whether she falls within the

ambit of a “judicial officer”.  In Deliu v Hong Winkelmann J stated that:5

...[I]t will be rare for costs to be awarded against a quasi-judicial officer such as the LCRO.

[15]     In U v LCRO6 Associate Judge Faire also stated that the LCRO is a quasi- judicial officer.  As such, Associate Judge Faire applied the test set out in The Coroner’s  Court  v  Newton.    He  decided  not  to  award  costs  against  the  LCRO because he did not believe this was one of the circumstances where a judicial officer

had done something which called for strong disapproval via an award of costs.

2      The Coroner’s Court v Newton [2006] NZAR 312 (CA) at [44].

3      Siemer v District Council at North Shore [2013] NZAR 168 at [10].

4      R v Liverpool Justices, ex p Roberts [1960] 1 WLR 585 at 586-587.

5      Deliu v Hong HC Auckland CIV-2011-404-3758, 18 December 2012 at [13].

6      U v LCRO HC Auckland CIV 2010-404-6350, 3 June 2011 at [54].

[16]     Associate Judge Faire listed provisions of the Lawyers and Conveyancers Act

2006 (the Act) illustrating that the LCRO is a quasi-judicial officer.  These include s

206(2) of the Act which grants an LCRO the power to hold hearings or to reach a determination on the papers.  Counsel and witnesses have the same immunities and privileges as they would have if they were in a court of law, pursuant to clauses 8 and 9 of the Third Schedule of the Act.  Under s 211 of the Act the LCRO also has the power to confirm, modify or reverse any decision of a Standards Committee and to exercise any of the powers which could have been exercised by the Standards Committee.  All of these provisions indicate that the LCRO has powers of a quasi- judicial nature.

[17]     Clause  11  of  the Third  Schedule  of  the Act  provides  that  the  LCRO  is immune from civil or criminal liability in relation to acts or omissions in the course of carrying out his or her functions, duties or powers unless he or she has acted in bad faith.  It would be inconsistent with this provision if bad faith or oppressive behaviour was not required in order for the LCRO to have a costs order made against them.

[18]     Having established that the LCRO is a quasi-judicial officer and is therefore prima facie immune from costs awards, the question is whether the LCRO in this case has acted oppressively, perversely, or in bad faith so as to justify a costs award being made against her.

[19]     I do not believe this threshold has been made out.   The LCRO made a material mistake of fact but this does not mean she was acting in bad faith.   The LCRO has abided by the decision of this Court.  In U v LCRO Associate Judge Faire did not consider that the procedural errors made by the LCRO fell into the category of rare circumstances which would call for strong disapproval by this Court in the

form of an order for costs.7

[20]     Newton and Siemer both state that a mere error of law is not sufficient for a costs award to be granted against a judicial body.  In Siemer the Council made two errors of law but Lang J said those errors cannot be considered to have been made

perversely, oppressively or in bad faith.8   Furthermore the fact the Council abided the decision of the Court was also a factor in his decision not to award costs.9   If an error of law is not sufficient to meet the threshold for a costs order then neither is a mistake of fact.  In my view, the LCRO did not act improperly, in a biased manner or

in a manner deserving punishment or condemnation.

The second defendant’s liability for costs

[21]     The  court  also  has  discretion  not  to  award  costs  where  a  party  has  not actively participated in the proceeding.  The overriding costs principle is r 14.1, that costs are at the discretion of the court.  The general rules contained in r 14.2 of the High Court Rules are that costs will be awarded against the losing party and that they must be predictable and expeditious.

[22]     Rule 14.7 of the High Court Rules also gives the court discretion to refuse or reduce an award of costs.   Rules 14.7(a)-(f) set out some common situations in which a refusal or reduction of costs may be granted.  Rule 14.7(g) allows the court to refuse or reduce costs in circumstances where:

Some other reason exists which justifies the court refusing costs or reducing costs despite the principle that the determination of costs should be predictable and expeditious.

[23]     I consider this to be such a circumstance where r 14.7(g) applies.  In Deliu v Hong Winkelmann J refused to award costs against either the LCRO or the complainant, Mr Hong, despite the fact her Honour had allowed the application for judicial review of the LCRO’s decision.  Winkelmann J stated that costs were not appropriately awarded against Mr Hong because he did not play an active role in the

proceeding.10

[24]     The same can be said of this case.   Ms Nie applied for a review of the decision of the LCRO on the basis that she was entitled to reasons.  Therefore she

became a party to the later judicial review proceedings of the decision by the LCRO

8 At [19].

9 At [20].

10 At [13].

and was named as the second defendant.  However Ms Nie took no part at all in the proceedings. As I noted in my substantive decision: 11

[T]he  second  defendant  took  no  part  in  these  hearings,  abiding  by  the decision of the Court, and I do not accept her complaint or application for review was in any way mala fides.

[25]     Therefore I consider this to be a circumstance such as in Deliu v Hong where the court should exercise its discretion and not award costs against Ms Nie.

Conclusion

[26]     The  plaintiff ’s  application  for  costs  against  both  the  first  and  second

defendant is dismissed.  Costs are to lie where they fall.

……………………………….

Woolford J