8 Dec 2022

Law Society's actions compounded errors of its disciplinary body - lawyer

1:05 pm on 8 December 2022
Maia Health Foundation chairman Garth Gallaway

Garth Gallaway is angry that two years after the High Court ruled in his favour, the Law Society has not published the decision which found against one of its committees. Photo: Supplied

A top lawyer embroiled in a long dispute with the Law Society's disciplinary committee says the profession's complaints system is "broken" and needs a complete overhaul.

The High Court ruled two years ago that the committee made an error in law in a case involving Chapman Tripp partner Garth Gallaway. He was furious the Law Society still had not published that decision.

In December 2020, the High Court ruled Gallaway had acted appropriately in providing advice to a client, and the Law Society's National Standards Committee hearing a complaint about him had misinterpreted the law and breached the principles of natural justice by failing to give him fair notice of issues that found against him.

The Law Society's failure to publish a summary of the High Court decision showed a lack of integrity, Gallaway said.

"They waive decisions against practitioners around so freely and so quickly, and yet, nearly two years after the High Court has found against their number one National Standards Committee so fundamentally, they have failed to publish that decision.

"I think it raises real questions of integrity," Gallaway said.

The saga started in 2015 when a valuer gave an earthquake prone building in Wellington a market rental value of nil.

A complaint was made about the valuer to the Valuers Registration Board. The valuer's indemnity insurance company appointed Gallaway as the lawyer to defend the charges.

The valuer eventually pleaded guilty and was fined, but soon after filed a complaint against Gallaway with the Law Society's National Standards Committee. The 2018 complaint alleged Gallaway had failed to act in the valuer's best interests.

The Law Society operates 12 standards committees to hear complaints made about lawyers. National Standard Committee One was allocated to Gallaway's case.

In June 2019, the committee decided Gallaway had acted appropriately in providing advice but had failed to correctly identify the valuer as his primary client, rather than the insurance company that appointed him, which was not part of the client's original complaint. It made a finding against Gallaway of unsatisfactory conduct.

This was despite a peer reviewed legal opinion from Mike Ring KC which said Gallaway had acted appropriately throughout and that his instructions were from the valuer and the insurance company.

"The strange thing about this is, in terms of the matters complained of, they found that there was no case to answer, that I had acted appropriately at all times and provided a good quality of service to the valuer. But then they went off down this rabbit hole of their own volition," Gallaway said.

Believing the committee's interpretation was wrong, Gallaway - with Chapman Tripp's help - sought a judicial review of the decision.

"The point about that finding is it would turn insurance law on its head.

"It's very clear that the National Standards Committee One doesn't have the slightest understanding about insurance law. They didn't interpret the contract correctly. And, you know, in my opinion, they were completely out of their depth."

In its December 2020 decision, the High Court found there was a "material error of law" in the committee's ruling.

It also found the committee breached Gallaway's natural justice by failing to give him fair notice of its intention to investigate the client issue.

Four months after the decision was issued, the Law Society told Gallaway it would develop guidelines to address the professional issues that arise when a lawyer is instructed by an insurer to represent an insured party.

Gallaway said he was still waiting for those guidelines. His requests for an apology for "the years of hell I've been put through" have also been ignored, he said.

"The worst part about it for me is not only did the National Standards Committee make such a fundamental error, but the Law Society then intervenes. Why would they get it so wrong as well?"

The complaints system was broken, too lengthy and needed an overhaul, Gallaway said.

The High Court found there was a "material error of law" in the committee's ruling and it had breached Garth Gallaway's natural justice. Photo: RNZ / Dan Cook

Backlog for appeals

Appealing Standard Committee decisions with the Legal Complaints Review Office, which was part of the Ministry of Justice, was also a lengthy process.

"The backlog there is currently in excess of a year," said Gallaway.

"The system's broken. We have to get things resolved in a more timely manner. Practitioners need to be treated with more respect and more kindly, and you have to have people who are competent sitting on these committees."

The Law Society said it doesn't normally publish full decisions of the High Court on its website, but it hoped to publish a summary of Gallaway's judicial review before Christmas.

Draft guidelines were also currently being reviewed by its legal team, it said in a statement.

"We hope to be able to publish them as soon as that review has been completed."

It was also "standard process" for the Law Society to intervene in judicial review matters involving a Standards Committee - this was not an unusual or unique intervention.

"The Law Society does so only to assist the Court as the Standards Committee abides. Since July this year, there have been seven judicial reviews against a Standards Committee and the Law Society has either been a party to or intervened in all of them."

Gallaway said he was troubled by the society's response that it intervenes in such matters to assist the court.

"That doesn't seem to me to be prudent or fair. What they did in my case was defend the decision of the committee and that seems improper to me."

When asked if it would be apologising to Gallaway, the society said it would be "inappropriate for us to make any comment on their decision".

"Standards Committees make independent decisions, and it is important that the Law Society does not seek to influence Standards Committees as decision makers."

An independent review panel was currently looking at the scope of the Law Society, including whether the complaints process was fit for purpose. The panel would report its findings to the Law Society's board by the end of the year, which hoped to release the report in the first quarter of 2023.