canterbury tales - nz law society · canterbury tales november 2016 vol. 22 no. 9 inside: 2...

Canterbury talesNovember 2016

Vol. 22 No. 9

Inside:2 President’s column

3 Comings and Goings

4 Why Lawyer Trustees need to understand the implications of The Financial Markets Conduct Act 2013

5 NZILE Canterbury Westland Branch Legal Executive Branch News

6 Is the RMA broken?

8 Education programme

8 Brighter financial future for Community Law Centres

9 Relationship property arbitration

10 Making Mistakes: Owning up or Covering up?

12 Teaching Civil Litigation in Tonga

12 LINX Case Summary – TWA v HC

Continued on next page...

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Katie Cowan of Symphony Law has launched “The New Lawyer” http://thenewlawyer.co.nz

Canterbury Tales talked to Katie about her new initiative:

Where did “The New Lawyer” idea come from?Katie, after reading Josh Pemberton’s 2016 report, realised that some troubling issues in and around young lawyers in the work-force were more widespread than previously appreciated. While Katie had been aware of some of these issues prior to the report, it was the impetus for her to find a way of supporting and encouraging young lawyers. Notwithstanding that the podcast has young lawyers as its focus it is a very exciting and professional initiative that will be of interest to anyone involved in the legal profession.

The New Lawyer is so-named for two reasons: its target audience is new and pro-spective lawyers and it aims to think in new ways about the practice and culture of law.

What is “The New Lawyer”?It is an audio podcast of 30-60 minute episodes, released on a fortnightly basis. It can be subscribed to and downloaded (at no cost) via iTunes, Stitcher and the iOS and Android podcasts apps or viewed via the website (above). Katie interviews guests, ranging from junior lawyers to Supreme Court Judges, about the basics of their

practice and what got them to where they are. The interviews then switch to discus-sions of issues of particular importance to that guest. Topics include, mental health and stress management, gender and diversity in legal leadership, how to find the right way to practice for your needs and advice on how to be a good junior and improve your experience as a new lawyer.

The website also has lists of resources that will support the discussions and other relevant helpful information.

Who will be interviewed?Upcoming guests include a second year solicitor in a provincial firm, a sixth year solicitor in a mid-size city firm, a former human rights lawyer now practicing in the UK, a novelist and lawyer practicing in a national firm, a Supreme Court Judge, practitioners at PDS and Community Law, an employment barrister, the Solicitor General and that is just to name a few!

What is the aim?To establish an industry-wide conversation about the practice of law, and contribute to a transformation of the experience of the next generation of junior lawyers for the better.

How do you hope to achieve this?» By Illuminating the practice of law,

New Podcast For New Zealand Lawyers

including the broad variety of ways one can practice

» Helping struggling junior lawyers feel connected and less isolated

» Jointly imagining how to make the indus-try better

» Empowering lawyers to make authentic decisions about their career

» Entertaining listeners and» Confronting and transforming key prob-

lems the industry and juniors face.

What will be discussed?The podcast will traverse all aspects of junior practice and career development, with spe-cial attention given to the following issues:» The transition from law school to practice» Finding the practice that fits your own

needs, values and career aspirations, including interviews with people in a wide range of legal roles, and discussion of how to know where you might fit

V I N O F I N OPhoto CaptionEach month we have a photo caption competition where we invite you to submit a caption. The winner will receive two bottles of wine sponsored by Vino Fino (www.vinifino.co.nz, 188 Durham Street). Send your entry to the Canterbury Westland Branch New Zealand Law Society, P. O. Box 565, Christchurch. Or email to [email protected]. All entries must be received by November 10 2016. The winner will be announced in the next edition of Canterbury Tales.

President’s columnBy Craig Ruane

Last month’s winner

Neville Tuck with:» “This is the weirdest police lineup I

have ever been in”

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Canterbury tales · November · Vol. 22 No. 9

LAW DINNERAs I have come to find in the last few months, one of the problems of producing a monthly President’s Column is the deadline. This is being dictated the day before the Law Dinner which was held on 20 October at the Christchurch Art Gallery.

I am not alone in this. Some readers may remember Alistair Cooke’s Letter from Amer-ica broadcast on National Radio for over 50 years. Cooke’s column was recorded on tape a few days before it was broadcast. In 1974 he was faced with the problem of reporting on the Watergate crisis, a topic which had gripped the US and the world in the early 1970’s. The House Judiciary Committee was due to report a few hours before the broadcast was due to air. They would decide whether to impeach Nixon, and Nixon would decide whether to resign.

Naturally enough the broadcast was devoted to the Watergate crisis but there was no way of knowing what the outcome would be. Having spent 30 minutes carefully analysing the issues he neatly sidestepped the problem with his last line: “the rest you know”.

By the time this column goes to print you will know how well the dinner went. I am sure this year’s Law Dinner, held at the Christchurch Art Gallery, will be a resounding success. The organising committee has been beavering away for several months. The pop-ularity of the Law Dinner was again demon-strated when the tickets were sold out within a couple of hours of being released. As usual there was a waiting list.

As well as the speaker, the Solicitor General Una Jagose, there was official entertainment provided by the Law Choir, Colin Eason, and Hans van Schreven and Simon Marks.

For those of you who may not have heard of it, the Law Choir was established barely six weeks ago to emulate, and perhaps to outdo,

similar choirs in Auckland and Wellington. A core group of about 30 have been practicing under the direction of two Choir Masters and the leadership of Stephanie Marsden. Colin Eason provided the accompaniment, and also performed solo later in the evening. His piece, Chopin’s Military Polonaise, was chosen, he claims, in honour of the Presi-dent’s military connection.

There was also a performance by Hans van Schreven and Simon Marks of the Leonard Cohen classic, Hallelujah.

The dinner was also used as an occasion to raise funds for Ronald McDonald House with an auction of small artworks. A more detailed report will follow in the next issue.

Thanks, in advance, to the organising com-mittee, Susie Tait, Lana Paul, Sarah Holder Alexandra Beaumont and Sophie Goodwin. Thanks also to the performers, finally a spe-cial thanks to the sponsors, Tony Mounce – Mortgages and Insurance.

New LawyersOn a more serious note, following the release of the Pemberton Report as published in Law Talk 891 (1 July 2016) the Canterbury Westland Branch of NZLS is leading the push with a number of initiatives to improve the experience of new lawyers entering the professional workplace in the first few years post admission.

With the help of the Canterbury Westland Lawyers Benevolent Fund and Katie Cowan, a series of podcasts have been produced. At this stage four podcasts are available with access via the website www.thenewlawyer.co.nz . The podcasts are free to view. Details of the podcasts have been sent to IPLS and to the College of Law as well as to the other NZLS branches. We are also advising the var-ious law schools so that they can include the link on their respective web pages. The Uni-versity of Canterbury Law School in particular is very supportive and will be promoting this to their students.

I spoke about these initiatives at the NZLS Council Meeting earlier in the month and there was a great deal of interest from all present.

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Canterbury tales is the official newslet-ter of the Canterbury Westland Branch New Zealand Law Society. Publications Committee: Zylpha Kovacs (convenor), Simon Shamy (editor), Carolyn Browne, Ann Maria Buckley, Daniel Weatherley, Beatrix Chin. All correspondence and photographs should be forwarded to:The Branch Manager, Canterbury-Westland Branch New Zealand Law Society, Level 1, 307 Durham Street, Christchurch. PO Box 565 Christchurch.P 03 366-9184 F 03 366-9977E [email protected] Tales is published 11 times per year.

Advertising$35 per column/cm exclusive GST.Contact: Jim KennedyE [email protected] 03 342-5457 M 027 577 7139Disclaimer: Canterbury Tales is published by the Canterbury Westland Branch New Zealand Law Society. The opinions expressed herein may not necessarily be those of the Branch and have not been expressly authorised. The Branch accepts no responsibility whatsoever for any error, omission or statement.

Canterbury tales

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November · Vol. 22 No. 9 · Canterbury tales

» Stress and wellbeing management, including how to handle a mental health issue alongside legal practice (with a spe-cial focus on success stories)

» How to deal with difficult situations at work, such as mistakes or a difficult boss, as well as bullying and harassment

» Gender, race and LGBTQ issues in practice and

» Ideas and examples of new ways to prac-tice and where the industry might go.

The podcast acknowledges the areas where the legal industry is not performing as it should, but uses the optimistic “appreciative inquiry” model to discuss how change can come about. It’s tone is professional but conversational and tends towards personal, authentic story-telling over dry analysis or theory.

Who is Katie Cowan?Katie is the director of Symphony Law Lim-ited. By day she is a civil litigation lawyer based in Christchurch. By weekends she works as an improv comedy musician for the Court Jesters and does other creative work whenever she can.

Symphony Law Limited operates Cowan Litigation, a boutique civil litigation practice, and Symphony Law, an unorthodox practice that creates projects to benefit the profes-sion (like this podcast) and the public (like entertaining legal seminars for lay people).

Who is behind The New Lawyer?Symphony Law created, hosts and bears all responsibility for the podcast.

However, the project has the kind support of the New Zealand Law Society, both via strong encouragement and input from NZLS lawyers and staff all over the country, and via generous expense-covering funding from the Canterbury-Westland Branch Benevolent Fund.

The Law Society wants to improve the experience of juniors as much as they can, and their support of the podcast is one important way they are putting that into action.

Are there any future initiatives?Katie’s podcast initiative is the first of 3 ini-tiatives by the Canterbury-Westland branch Council. The council is planning to set up a “young-lawyer” focused panel of friends and is working with University of Canterbury School of Law to introduce young lawyer focused information sessions for final year law students. The University Of Canterbury School Of Law supports this initiative.

If you have any questions please email Katie – email – [email protected] and don’t forget to tell others about the podcast and leave a review on itunes and subscribe to the podcast (it helps ascend the search rankings). You can also send in feedback or questions on episodes.

Continued from page 1...Comings & Goings

Information for this column must now be sent directly to the Canterbury-Westland branch due to privacy issues. We assume that by the firm supplying the information that the individual people have agreed to their names being published. Please send information regarding changes to firms or practitioners to [email protected] or [email protected].

JoinedDr Maria Pozza has joined Lane Neave (previously with Helmore Ayers)

Change of StatusRebecca Hopkins, and Rachael Mason are now Partners with Lane Neave.

As from 3 October 2016 Lincoln Law Limited has purchased the Lincoln Law Practice from Suburban law. David Hayward will be the sole Director of Lincoln Law Limited.

D I S P E R S A L S P E C I A L I S T S O F D E C E A S E D E S T A T E S A N D D O W N S I Z I N G H O M E S• We work with family members, estate executors, trustees and solicitors

to facilitate the dispersal of household items.• Catalogue household items for the trustees approval for dispersal• We prepare the house for sale with a focus on maximising the value.Owners: Rachel Maule & Phillippa Smith Ph: 03 354 6011 Cell: 022 340 5045Web: www.estatematters.co.nz Email: [email protected]

Andrew Nuttall

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I recently attended a client’s annual Trust meeting with their lawyer Trustee and accountant.

The agenda included updating the doc-uments that defined the relationship with our firm as the investment adviser, as well as the Investment Policy Statement.

The Lawyer, a senior partner of a large Christchurch firm, was grateful to receive the updated documents as it helped him to satisfy his duties as a Trustee. He suggested that I write an article to prepare other lawyer Trustees to receive documents for Trusts that hold investment securities and portfolios.

One of the implications of the Financial Markets Conduct Act is that investment advisers may need to provide new docu-ments and will need to provide new dis-closures to all clients.

There are now two broad types of services that advisers provide.1. Discretionary Investment Management

Service (DIMS)A DIMS is where the adviser has discretion to acquire or dispose of securities in a portfolio on behalf of the client without seeking client approval for each transaction.

2. Non-DIMSA non-DIMS requires client/Trustees to make the final decision before authorising or declining investment recommendations. Trustees would need to consider all recom-mendations and might need to document

reasons why they elected to accept or decline any recommendations.

Advisers who provide a DIMS must be licensed by the Financial Markets Authority (FMA) to do so and update all clients’ documents by December 2019.The licensing requirements include a suite of documents: a Service Disclosure Statement, an Investment Proposal, an Investment Authority and a Client Adviser Agreement (this one’s not new). These documents must be provided to and be signed by all Trustees who should take time to consider and seek clarification as required. These documentsinclude new commentary on risks and greater disclosure around conflicts ofinterest.

Higher standards of Fiduciary care and the draft Law Commission review on Trusts suggest that an Investment Policy Statement should also be provided but that is a topic for another time.

While, at times, working with new legis-lation can be time consuming, we believe that the 2013 act, which replaced the current financial markets conduct law contained in the Securities Act 1978, Securities Markets Act 1988, Securities Transfer Act 1991, the Superannuation Schemes Act 1989, Unit Trusts Act 1960 and parts of the KiwiSaver Act 2006, is a positive step forward and will

improve the quality of financial advice in New Zealand.

If you are a Trustee who is responsible for investment assets we believe that the requirements of the new legislation is an opportunity to formally review the needs, objectives and requirements of all benefi-ciaries. Trustees should give consideration to the possible risks of investments and the rate of return required from those invest-ments to meet the expected and reasonable objectives of the beneficiaries. If Trustees do appoint an investment adviser, they should document how they will measure and evalu-ate the adviser’s performance as well as the due diligence undertaken in the both the initial and any subsequent reappointment.

The above might sound onerous, but higher standards and greater rigour should result in better investment experiences for New Zealanders. Greater transparency will also help to expose and reduce advice influenced by those with vested interests. Trustees should read the above mentioned documents and look for areas of potential conflicts of interest, including commissions and recommending employer’s products. If you are not satisfied, you should not hesitate to seek a second opinion in order to fulfill your duty of care to the beneficiaries. We believe that just like doctors or lawyers, financial advisers should always provide advice that is unbiased, free of conflicts of interest and based on sound fiduciary principles.

Andrew Nuttall is an adviser and director of Bradley Nuttall Limited, an independent financial advisory firm based in Christchurch. Andrew has worked closely with the legal fraternity for over 25 years. His disclosure statement is available on demand and free of charge.

Bradley Nuttall Ltd is licensed to provide both discretionary management services as well as the nondiscretionary service.

Why Lawyer Trustees need to understand the implications of The Financial Markets Conduct Act 2013By Andrew Nutall, Director, Bradley Nuttall Ltd

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We have some important dates coming up:» Wednesday 2 November – Our final

Christchurch legal executive seminar for the year is to be held on Wednesday 2 November at the Burnside Bowling Club. The topic is Wills Drafting – e.g. complex scenarios, blended families, hard ques-tions you have to ask your clients, etc. Please note your diaries now. A flyer will be distributed to the Canterbury mem-bers in early October.

NZILE Canterbury Westland Branch Legal Executive Branch News

Auckland13th Floor, 175 Queen StreetPO Box 2137Keith Harris

Christchurch8b Homersham Place, BurnsidePO Box 20-009Wayne Deuchrass

Dunedin248 High StreetPO Box 1058Iain Nellies Gus Jenkins

www.insolvency.co.nzEmail: [email protected]

Free Phone: 0800 633 343

• • General Insolvency Advice • Mortgage Recovery Assistance • Property

•

Please give them the opportunity to leave a legacy to St John that will provide a vital service to benefit their community.

Email [email protected] call the Legacy Coordinator South Island Region for further information: 03 353 7110 ext 3238

Has your client considered including a charity in their will?

Malcolm Wallace

Malcolm is available to accept appointments as an Arbitrator or Mediator. To discuss terms of appointment and availability contact Malcolm on:[email protected] 03 3796 976 027 260 3431

AMINZ Fellow (Arbitration)BARRISTER

» Monday 7 November is our AGM which is being held at Anderson Lloyd’s offices in Christchurch, commencing at 5.30pm. We ask our members to make an effort to come along to the AGM please. If you are unable to make the AGM please send in your proxy form if you are an Affiliate, Associate or Fellow, as you have voting rights. If you are interested in becoming a committee member then please email us at [email protected]

» Friday 18 November is our end of year Christmas function which is being held at Visions Restaurant in Christchurch from 6.00pm. This is a three course buffet

dinner and this year NZILE National Coun-cil members from around New Zealand will be attending. A flyer will circulate to members shortly.

» Our Quarterly Quip newsletter for October has just been circulated to our branch members. It contains details of the Committee members if you wish to contact them, updates from our liaison officers around the South Island, and our latest news on social events, seminars etc.

» Tuesday 27 September we held a movie night in Christchurch. We were thrilled to have 33 attendees. It was a fun night, meeting first at Dragons Den for drinks and food and then moving to the thea-tre to watch Bridget Jones’s Baby. Some photos are below.

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Minister Smith considers that the Resource Management Act 1991 (RMA) is not work-ing and has some fundamental flaws that require substantial overhaul. He contends the RMA is outdated and ill matched with the reality of the issues that it manages. So he has presented the Resource Legislation Amendment Bill 2015(the Bill) to Parliament.

The Bill has had its first reading and a select committee has heard many submis-sions on the Bill. The Committee was due to report back to the House on 6 September, but this date has now been pushed out until 11 November 2016.

Accompanying the Bill is a discussion document that sets out the Government’s reasons for further reform of the RMA, which are summarised as follows:

“…resource management processes are cumbersome, costly and time consuming, and that the system is uncertain, difficult to predict and highly litigious. The system seems to be difficult for many to understand and use, and is discouraging investment and innovation. The outcome is delivered under the RMA are failing to meet New Zealanders’ expectations.”

In this article I will consider whether the above criticisms are justified and discuss the impacts of the proposed changes if some of the key reforms within the Bill are adopted.

The Reform PackageThe Bill is some 180 pages long comprising 40 changes contained in 235 clauses and eight schedules. The Bill proposes changes to the RMA, the Reserves Act, the Public Works Act, the Conservation Act, the Environmental Protection Authority Act, and the Exclusive Economic Zone and Continental Shelf (Envi-ronmental Effects) Act.

Judged by size alone, the Bill proposes significant changes. Changes of this breadth are not amenable to sensible coverage in a single article so I am focusing on only some of the proposed changes to the RMA that I consider will have the biggest impact.

Is the need for change made out?The first question I have considered is whether the Minister is correct when he describes the RMA as cumbersome, costly, time consuming, and highly litigious.

Examining data can be a useful approach to help determine if these contentions are supportable.

A survey completed of local authorities during 2012/13 confirmed that of the 34,000 resource consents processed, 95% were non-notified, 97% were processed on time and only 0.27% of applications processed to a decision were declined.

Turning to plan changes, that same survey details 133 plan changes and notes that the average time frame for processing was 24 months. These timeframes had increased by 7 to 8 months compared to the previous survey covering 2010/11.

The current Environment Court work-load as at 1 June 2016 is 347 active appeals nationwide. In 2006/2007 the Court had 919 appeals along with some 222 miscellaneous applications. So between 2006 and 2016 the Court has disposed of a significant number of proceedings and the number of fresh proceedings has significantly declined.

Based on the above, in my view the data supports the argument the RMA and its processes are in fact efficient. So taken at face value, the data does not support the proposition the RMA is cumbersome, costly, time consuming and highly litigious.

What really motivates the changes?If the data is not supportive of change, the question becomes what really motivates these changes. In my view reasons for change can be linked to what the RMA is all about. Allocation of access to resources is often contentious with accompanying entrenched positions depending on what side of the argument you sit. Some want access to resources with limited constraints via an allocation process which is stream-lined, meaning one that limits participation, potential opposition and judicial oversight that can cause delay and expense to pro-jects. Others want limits on access and con-trols on the use of resources accompanied with full rights to have a say and judicial oversight by appeal.

Given the RMA processes allocate access to resources, it has an influence on the market and has therefore faced political pressure for change since its inception.

By Paul Rogers, Partner Adderley Head

Is the RMA broken? Not surprisingly there is a link between the nature of the changes now being advanced and the political leanings of the Government of the day.

The RMA has been the centrepiece of our environmental legislation for 25 years. It commenced providing a one stop process for allocation of resource rights including extensive public participation opportunities accompanied with strong judicial oversight.

Both public participation and judicial oversight have faced change pressure since inception of the RMA with a clear trend of contraction for both evidenced in many amendments over time. This Bill not only continues that trend but in my view more than any other amending Bill before it will further and significantly reduce rights of public participation and access to justice and will severely test a long standing principal of planning decision making that local people will make decisions on local issues.

Public Participation and Access to JusticeAdditional reasons supporting the need to review public participation is found in the regulatory impact statement accompanying the Bill. The amendments are supported on the basis that the current scheme of broad public participation is somehow a negative as it “undermines the purpose of notification and seeking submissions, which is to give decision makers useful, focussed input”.

I do not understand how this outcome arises. What is however clear is that this stance is directly opposed to the basic concept of public participation, which is the cornerstone of RMA processes.

Many submissions on the Bill from inter-ested parties raised very clear concerns to the select committee that many of the amendments proposed under the Bill either completely remove or significantly diminish public participation and rights of appeal. Submitters were critical that the removal or loss of those rights was not counterbalanced by benefits of new processes provided for under the Bill.

This Bill proposes reducing public partic-ipation and judicial oversight in a number of ways, as discussed below.

NotificationThe well settled notification provisions of the RMA are up for change. The Bill contains a new step by step test for notification. This proposed change will inevitably lead to

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uncertainty and possible litigation.The circumstances in which an application

will be publicly notified under the Bill are more limited than under the existing section 95A. In addition, the circumstances in which an application may be limited notified and the persons to whom it may be notified are more restrictive than what currently exists.

As already noted there is a low percentage of applications currently notified so reducing scope for notification and thereby reducing public participation and consequent judicial oversight even further is questionable in terms of justification.

Limited appeal rightsThe Bill includes special appeal rules exclud-ing the ability to appeal in relation to bound-ary activities, subdivision, and residential activities on a single allotment.

These rules are promoted on the basis that property rights should be better rec-ognised. Excluding appeals for these types of activities will certainly mean property owners as applicants will be free of the effects of unnecessary appeals on the one hand, but property owners as submitters will be excluded access to justice.

Strike outThe Bill would enable consent authorities on hearing a resource consent to have the same powers to strike out submissions as the Environment Court has with some new additions. The Bill requires an authority conducting a hearing to strike out those submissions that do not have a sufficient factual basis or are not supported by evi-dence or are unrelated to the effects that were the reason for notifying the application.

Directions to strike out can be made at any time through the hearing process. In my view the decision-makers under the RMA will be called upon to exercise this new power because if a submission is struck out appeal rights are lost. Disappointed participants undoubtedly would resort to any available legal avenue to challenge decisions striking out submissions.

Up until now submitters do not face onerous obligations in relation to the sub-missions. The current constraints require a simple statement as to the nature of the concern accompanied with reasons. This is because the subsequent resource consent hearing process which follows submissions enables evidence to be produced in support of those primary submissions.

So when during the process does the

decision maker decide there is a lack of evidence to support a submitter’s view? Would a lack of evidence be made out if the submitter brings forward their own personal views as compared to an expert’s view? These questions remain unanswered.

Ministerial powersAnother set of provisions give the Minister for the Environment new powers, including the ability to dictate the content of rules in regional and district plans via regulations.

In my opinion, the Minister’s new powers directly contradict the previous approach of local decisions being made by local people. These new powers given to the Minister would enable him or her to even change existing rules put in place following public participation and overview of the Environ-ment Court. So access to justice is further reduced.

The proposed new streamlined planning process for plan reviews is another process that the Minister is able to control. How that control is to be exercised is not clearly spelt out within the Bill. What is clear however is the power exists to completely reject an outcome that has been arrived at following local people putting forward their views. The Minister may displace that outcome and the Bill provides no right of appeal arising from the Minister’s decision. This in my view both impacts upon public consultation and removes judicial oversight, further reducing access to justice.

ConclusionsI am far from convinced that the RMA is performing so poorly that the significant interventions proposed by the Bill are justified.

I acknowledge that I have only considered

a very limited number of possible amend-ments. I have chosen to comment on these points because I think they have the most significant impact.

If these proposals are ultimately passed into law in the form that they are expressed in the Bill then public participatory rights will be severely curtailed as well and access to the Environment Court for considered expert and impartial review. Central Government through the Minister will have wide reaching powers in terms of determining content of district and regional plans. I do not think these interventions are justified nor do I think they are likely to improve the RMA. If passed they will create much uncertainty and would likely give rise to more litigation.

We will provide further commentary on this matter once the Bill passes into law.

Disclaimer: This is a brief summary for infor-mation purposes only and is not legal advice

Compass

Who will buy your business?

Do you want to grow your business?

Education Programme

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ChristchurchNovember» 2 Nov – Webinar – Right to silence and

to Counsel at the Police Station» 3 Nov – Clayton implications for practi-

tioners – webinar» 8 Nov – Webinar – Diversion» 9-10 Nov – Reading Accounts and Balance

Sheets» 9 Nov – Costs in Civil Litigation – Webinar» 10 Nov – CPD Reflective Practice – Webinar» 15 Nov – Environmental Law Intensive» 21-22 Nov – Intro to High Court Civil

Litigation Skills» 22 Nov – Fiduciary Relationships» 30 Nov – Ethics Series Practising on Own

Account – Webinar

December» 7 Dec – Webinar – Costs in Civil Litigation

February 2017» 9 Feb – Webinar – Tenanted House or

‘P’ Lab» 14 Feb – CPD Top Up Day» 21 Feb – Media Law» 28 Feb – Guarantees

Social Events:» 17th Nov – litigation social drinks – Look

in weekly notices» 24th Nov – Family Law Drinks – Look in

weekly notices» 8th Dec – Young Lawyers end of year

Christmas Bash – Look out in weekly notices

Out of Christchurch Courses:» 7-8 Nov Wgtn, 14-15 Nov Auck – Intro to

Family Law Advocacy and Practice» 8 Nov – Auck – Body Corporate

Governance

» 16-17 Nov – Auck – Lawyer as negotiator» 17-19 Nov – Auck – Stepping Up» 22 Nov – Auck – Commercial Mediation

» 25-27 Nov – Auck Mediation for Lawyers Part b Civil/Commercial & Family

» 16 Feb – Auck – Trusts for Company and Commercial Lawyers

Community Law Centres will benefit after the final three banks agreed to increase their financial contributions.

The country’s 24 community law centres receive a large proportion of their funding from the Lawyers and Conveyancers Special Fund.

Established in 1982, the fund collects interest from banks on solicitors’ and licensed conveyancers’ nominated trust accounts. The fund is vested in the New Zealand Law Society and the New Zealand Society of Conveyancers jointly and is held by them in trust for the purposes specified in the Act.

The Act allows banks to retain 40% of the interest payable on nominated trust accounts. After deduction of that amount, the banks are required to pay the remain-der to the Special Fund Management Committee.

After deduction of administration expenses including an audit fee, the balance in the fund is paid to the Secretary of Justice for the purpose of funding community law centres.

BNZ and TSB have already agreed to lower their retention to 20% after recognising their declining cost of administration due to advanced computerised collection, and donate the other 20% to community law.

Today, the remaining banks, ANZ, ASB and WESTPAC that are involved in administer-ing the Lawyers and Conveyancers’ Special Fund announced a new partnership with Community Law.

That will result in the bank trio making an annual multi-million dollar donation to Community Law.

Community Law Centres o Aotearoa Co-Chair Cameron Madgwick says it’s a clear demonstration of social responsibility by the banks and their commitment to a healthy civil society.

“For the last 25 years, in an effort to assist Community Law and in accordance with rel-evant legislation, banks have paid interest from solicitors’ nominated trust accounts to a Lawyers and Conveyancers Special Fund. Interest is not normally paid to lawyers and conveyancers on such accounts. Each year around $6 million is paid by the major banks to this fund and that amount helps to fund Community Law Centres,” he says.

The New Zealand Law Society’s annual report for the year to 30 June 2015 shows that $6.862 million dollars was paid to the Secretary of Justice in the year to 30 June 2015.

Mr Madgwick won’t say whether the ANZ, ASB and WESTPAC banks have matched the lower interest retention of 20% in line with BNZ and TSB.

“It’s a confidential agreement but you can be assured their contribution is a multi-mil-lion dollar annual figure,” he says.

The Associate Justice Minister Simon Bridges has welcomed the move by the three major banks.

“The banks are to be applauded for this additional support for community law cen-tres,” he says.

Brighter financial future for Community Law Centres

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LegacyThe Canterbury Medical Research Foundation has funded more than $20 million in health research in the Canterbury area. The mission of the Foundation is to fund new research that will make a di� erence to people’s lives, now and for future generations.

Talk to your clients today about creating their legacy, visit www.cmrf.org.nz

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At the recent NZLS PRA intensive seminar, the Honourable Robert Fisher QC presented a short paper on relationship property arbi-tration. That paper and presentation was a summary of a more detailed article published in the New Zealand Family Law Journal in 2014.

Relationship property disputes are able to be resolved by agreement between the parties if the formalities prescribed by the Act are complied with, and in such an agreement the parties can agree to resolve relationship property disputes by arbitration.

Arbitration has a number of potential benefits to the parties. Almost invariably the quality of the information available to the decision maker (and to the parties) is vitally important in arriving at an appropriate classification and distribution of relationship and separate property assets. Arbitrators have a unique ability to adopt an inquisitorial approach to ensure that there is full disclo-sure with the minimum of fuss. Arbitrators can examine all persons on oath who might hold relevant information and direct them to provide that information to the arbitrator and to the parties. It is very common for the absence of full disclosure to be a reason why relationship property matters are not able to be resolved by agreement between the

Relationship property arbitration

parties. The adoption of such an inquisitorial process by an arbitrator is therefore very likely to lead to early resolution between the parties without the need for a formal hearing.

Once parties appoint an arbitrator to determine a dispute, that arbitrator will decide upon all preliminary issues as well as the final substantive award if necessary. This continuity is an obvious advantage to both the decision maker and to the parties. It is rare for a Judge to be able to retain control of a file in the Court process from commence-ment to final judgment. The arbitrator will be involved in the shaping of how the case proceeds from its inception, subject always to control by the parties.

It should be possible to obtain a final hearing before an arbitrator many months earlier than could be obtained in Court. The availability of the arbitrator to sit at the final hearing is known to the parties at the time of appointment of the arbitrator or at the very least the first preliminary conference. In this way, both the parties and the arbitrator are able to work together to ensure that any final hearing is conducted as soon as reasonably possible.

Parties and lawyers will naturally be con-cerned about the payment of fees to an arbitrator as potentially being prohibitive. However, once Court filing and hearing fees are taken into account the difference between the cost of an arbitrator on a daily basis as compared to Court fees might not be so dramatic as first thought. It is also possible to select an arbitrator at the appropriate level

for the particular dispute. One size does not fit all.

As we all know the longer any matter takes to be resolved, the more expensive it nec-essarily will be. Even in the absence of real progress, the fact that a file is open means that there will continue to be attendances that cost a client fees. This means that a shorter period of greater focus can reduce significantly the overall cost to the clients of resolving their relationship property dispute.

Arbitrators are able to work with the parties to ensure that the particular process that is adopted to determine their dispute is appropriate. One particular aspect that is attractive is the ability to have a single issue hearing on one aspect that is troubling the parties. Often there is one issue alone that is preventing the parties from reaching an overall resolution. If an arbitrator is appointed to determine that single issue that might well enable the parties to resolve all other issues themselves. That might involve the arbitrator then adopting the role of a mediator having become familiar with the issues between the parties so that the arbitrator changes role in helping determine the outcome for the parties once a preliminary or isolated issue is determined.

Arbitration has the attraction of finality and confidentiality. Unless the parties agree to there being an appeal on a question of law, there are very limited grounds for applying to set aside an Award. This can be contrasted sharply with Court proceedings which as recent Supreme Court judgments illustrate might mean that parties are involved in sev-eral years of litigation before having matters finally resolved. While there are undoubtedly circumstances where multiple appeals are appropriate, in the vast majority of cases, it is likely that both parties would prefer to have mattes resolved as quickly and quietly as possible to enable them to continue their lives.

Malcolm WallaceBarrister, FAMINZ (Arb)

Malcolm Wallace is a Barrister and Arbitra-tor practising from Canterbury Chambers. He sets out some of the, perhaps, less widely appreciated advantages of using arbitration in the resolution of disputes in the Relationship Property context. The above article may be helpful to those practitioners considering the options in this area.

Simon ShamyEditor

1. (2014) 8 NZFLJ 15

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Making Mistakes: Owning up or Covering up?By Kate Geenty

If you make a mistake as a lawyer, is your instinct to pretend it hasn’t happened or to own up and apologise? Your reaction could depend on your firm’s culture, according to research by Catherine Gage O’Grady from the University of Arizona’s James E. Rogers College of Law.

Her article, “A Behavioral Approach to Lawyer Mistake and Apology” will be pub-lished in the New England Law Review. It may be downloadedfrom the Social Sciences Research Network.

Professor O’Grady says mistakes can be caused by a lack of knowledge or an error of judgement. She defines a lawyering mistake as something a lawyer does (or doesn’t do) that results in an actual or possible poor outcome for clients.

“Mistake is not intentional – the lawyer’s decision to act or not may be intentional, but the poor outcome is unintentional.”

Owning a mistakeFacing the consequences of messing up is unpleasant, to the extent that sometimes a lawyer may not realise or acknowledge they have made a mistake.

“At a most basic level, our unconscious avoidance of mistake realisation reflects our unwillingness to confront the ‘sense of dread on realising that one has made an error’,” Professor O’Grady says.

Lawyers place a lot of importance on their reputations and maintaining that reputation is a powerful motivator for decision-making and behaviour. “Thus, a lawyer may reason-ably be unconsciously motivated to avoid recognising a mistake that amounts to a reputational blemish.”

Fearful newbiesFacing the music can be especially daunting for lawyers at the beginning of their careers. Professor O’Grady says new lawyers can be fearful of the potential consequences of admitting to mistakes, unsure if their superiors will think them incompetent or if they will be sanctioned or even fired.

“Thus, the new attorney with only a shal-low knowledge of actual consequences that might accompany a mistake, may fear that a mistake will be career defining, or even career ending, in a way that a more mature lawyer would not.”

A ‘winning’ mentalityA desire to fit in to a ‘winning’ team, could also discourage mistake acknowledgement, says Professor O’Grady. She says firms that are structured hierarchically do not typically encourage mistake acknowledgement because “firm leaders often view errors as ‘indicative of incompetence’ leading people in organisation hierarchies to ‘systemically suppress mistakes and deny responsibility’.”

She says work teams developed within hierarchically organised firms present their own ‘moral universe’ which may make ‘winning’ the central mission of the team.

Spiralling out of controlProfessor O’Grady says creating work envi-ronments that promote early recognition and acceptance of mistakes “serves to contain unfortunate situations, avoid one mistake building incrementally on another, discourage denial and cover-up, and facili-tate learning for professional growth.”

She cites the case of a lawyer in Arizona who went to extreme lengths to avoid

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admitting to her client that she’d missed a statute of limitations deadline.

“Instead of confessing error and com-pensating the client for her mistake, she invented a fake settlement, created false paperwork and a false court file, and was presumably intent of paying the client the ‘settlement’ money out of her own pocket,” Professor O’Grady says.

The Disciplinary Commission of the Supreme Court of Arizona found that the attorney’s misconduct was driven by a desire to protect herself from humiliation and a fear of losing her job.

Risk management vs quality controlFirms can put a risk management approach to dealing with mistakes, or a quality control model. Professor O’Grady says these models have very different goals and are likely to result in different organisational structures and cultures when it comes to mistakes.

She says an emphasis on risk manage-ment is designed to protect the law firm rather than the client, while a quality-control model has an eye on client services and seeks to design organisation structures and practices in a way that reduces errors and improves performance.

“Thus, applying values-orientation and quality control insights to the practice of law is likely to result in firms creating environ-ments and cultures that insist on attorneys recognising, acknowledging, and ultimately learning from lawyering mistakes.”

Creating an accepting cultureFirms need to create an environment of ‘mistake acceptance’, Professor O’Grady says, so lawyers understand it is safe to confess if they’ve made an error.

“When lawyers feel that they can discuss mistakes openly and confidentially with their supervising attorneys or with a trusted member of the firm, more mistake will be detected and ultimately reduced.”

Some bigger firms in the US have an ethics counsel or an attorney who is available to confidentially talk through matters concern-ing ethics or mistakes. While smaller firms

11


may not be able to provide a dedicated staff member, Professor O’Grady says firms of any size can provide a process or system for discussing ethical questions and exploring mistakes.

She cites a partner at a firm called Wiggin and Dana who regularly sent emails to his firm that he called ‘wit and wisdom’ messages.

“While some of the emails imparted eth-ical guidance on specific issues like conflict of interest, improvident emails, or writing engagement letters, many of them simply reminded attorneys that they should not attempt to fix mistakes or fix potential problems themselves, and the messages underscored that lawyering mistakes will be accepted by firm leaders, but an attorney staying quiet about a mistake will not be,” Professor O’Grady says.

EXAMPLESProfessor O’Grady includes anecdotes from lawyers and how they felt about making mistakes. Here’s what they had to say:

Why feedback is important“When my senior colleague shared with me his view on my [mistakenly worded] email, I was at first visibly upset. But I later sent him an email thanking him for his feedback.” - Municipal court judge describing experience as a new attorney

“I submitted an opposition brief to a motion for summary judgement to the supervising partner a few days late. I did not think much of it – I was just relieved to have it off my plate. I became aware that I could have handled things differently when a few months later, the judge ruled in our client’s favour and the partner sent around a congratulatory email to those who had a hand in the victory, but I was not on the list. I emailed the partner, a little tongue-in-cheek, asking why I didn’t get any recogni-tion for my effort. He then responded with a lengthy, scathing email detailing why I did not deserve any praise – mostly because I turned the motion assignment in late. I set up a lunch with the partner to sit down and discuss what happened, why he was upset, and what I could have done differently.” - Attorney with six years of experience at a

large firm.

Reputational and career fears“The supervising attorneys want to know if you’re in over your head. But as a young lawyer, you don’t know if that’s lip service or if it will be held against you. I think it is held against young attorneys. Mis-take make supervisors ask whether you are progressing as fast as you should.” - Attorney at a tax law consulting firm with 20 lawyers.

The benefits of apologising“Apology to a client is a delicate balance. On the one hand, I want clients to have confidence in my competence. On the other hand, I want them to know that I am a human being, and that I am open to their suggestions about how their case should proceed. I do think there’s a moment for apology to improve trust.” - Plantiffs’ firm employment law attorney in seventh year of practice.

Different firms’ approaches to mistakes“At my second workplace, the incentive was strong not to disclose a mistake, but only if you were sure no one would find out about it.” - Business attorney with three and a half years of practice experience

“The environment at our firm is very encouraging when it comes to admitting mistake – actually, not disclosing a mistake is much more intimidating then disclosing one.” - Attorney at a large commercial liti-gation firm

“As a new attorney, I worked primarily with two supervising attorneys. One was

terrifying whenever anything went wrong – for example a typo in a brief, or if we filled in the wrong county – so I would try to fix things without telling him because it was easier.” - Attorney at a firm with 12 attorneys.

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John Hardie, Barrister and Mediator, was recently in Tonga assisting their Chief Justice, Owen Paulsen, present a course to some of Tonga’s legal fraternity. The course was very well received. The photo above is of the presenters and the attendees outside the venue in Tonga.

Teaching Civil Litigation in Tonga

TWA v HC – Court of Appeal, 28 September 2016, [2016] NZCA 459

CHILD LAW – JURISDICTION – WRIT OF HABEAS CORPUS

Successful appeal against order dismissing application for writ of habeas corpus – appel-lant brought proceedings under Habeas Corpus Act 2001 for a writ of habeas corpus, contending that S (appellant’s daughter) was unlawfully detained because the Family Court orders which regulated her care and guardianship were illegal – at the time of S’s birth both parents were serving prisoners – S was placed in the foster care of HC and had remained in HC’s care since then – Chief Executive of Ministry of Social Development has had legal custody of S for most of this time – S aged 9 years – father remained in prison and mother was deceased – in late 2014 Family Court made orders intended to provide for long-term care of S on the basis that she would continue in HC’s care with

appellant having supervised contact with S when she requested this – orders were made with father’s consent – application was motivated by appellant’s concern that S should have a relationship with him – regu-lar visits with father had ceased when S was 4 years old – appellant believed S required support and counselling to encourage her to continue contact with him and that she was not receiving this.

HELD: appeal allowed – specialist jurisdic-tion of Family Court and powers the Court had under the Children, Young Persons, and Their Families Act 1989 (CYPFA) and Care of Children Act 2004 (COCA) meant that resort to habeas corpus in custody cases was rare in modern times – nevertheless jurisdiction continued to exist and did not depend upon the physical restraint or the absence of consent on the part of a child – appellant had raised an issue as to the law-fulness of the guardianship and parenting orders – those orders governed who made decisions affecting every aspect of S’s care – Court of Appeal was satisfied that there was an issue regarding the custody and guardianship arrangements for S sufficient to engage the habeas corpus jurisdiction – Court of Appeal agreed the HC Judge erred

LINX Case Summary – TWA v HCin finding that the writ procedure was unavailable in this circumstance and as to his interpretation of s120 CYPFA – the High Court had not disputed that a prerequisite to making of parenting or guardianship orders under COCA was that s101 or s110 orders be discharged – however the High Court found that s120 did not prohibit the almost simultaneous removal and reinstatement of orders under CYPFA, allowing the making of COCA orders in the scintilla of time between that removal and reinstatement – while the pragmatism of this approach may have some attraction it was inconsistent with the clear intent of the legislation that parenting and guardianship issues for children subject to custody or guardianship orders under CYPFA be addressed through the CYPFA regime – purpose of s120 was clear – it was to ensure that decisions regarding the guardianship and custody of a child who was subject to the care and protection regime and custody or guardianship orders, were addressed through the decision-making regime in CYPFA not that in COCA – on a plain reading of s120(1) any orders subject to custody or guardianship orders under CYPFA should be dealt with under that leg-islation – Court of Appeal orders: order of High Court dismissing the application for a writ of habeas corpus quashed; – application for writ of habeas corpus to be transferred to the Family Court for determination under s13(2) Habeas Corpus Act 2001; – under the High Court’s parens patriae jurisdiction arrangements for the care and custody of S will continue as set out by the Family Court in 2014 until further orders for the care and guardianship of S are made by the Family Court.

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