Lawyers and Conveyancers Bill

Part 2 of the bill contains the title protection provisions. It will be an offence to use the term “lawyer” or “law practitioner” if one is not entitled to do so. This part also defines the areas of work that are restricted to lawyers and licensed conveyancers. The Government Supplementary Order Paper amendments clarify that the bill will not prevent State sector non-lawyer employees from carrying out functions they currently perform legitimately. These amendments address concerns raised by the Inland Revenue Department in relation to the definitions of conveyancing and legal services. Government Supplementary Order Papers also clarify that patent attorneys can continue to undertake intellectual property conveyancing functions. These amendments are supported by the New Zealand Law Society and the New Zealand Institute of Patent Attorneys.

National supports the Lawyers and Conveyancers Bill and has done so from the outset, with some reservations that are contained in the report that forms part of the commentary reported back by the Justice and Electoral Committee. I want to indicate, against the background of some 14 amendments that have been made by Supplementary Order Paper, that National’s contribution to those amendments is in only three areas.

The first area, as members of the Committee will have heard in comments relating to those amendments in connection with Part 1, is all about the New Zealand Society of Conveyancers. The amendments seek to strike from this bill reference to that particular organisation. National members have seen that as a very principled response. Let me explain why. This bill is called the Lawyers and Conveyancers Bill. For our money, it would only have been called—and should only have been called—the “Lawyers Bill”. But instead, the Government has decided that there is to be brought into existence a new class of statutory creature—the New Zealand Society of Conveyancers. As members will have noted from the number of amendments to Part 1, the legislation reeks of reference to this New Zealand Society of Conveyancers.

Well, what is the planned stature of this organisation, the New Zealand Society of Conveyancers? Not much, I would say. The committee heard evidence from the New Zealand Law Society that there might be five or six such persons who would be qualified to join the society, and the faint possibility that Australian conveyancers might seek to join the society. So the likelihood is that there would be, in total, seven or eight such people. If that is right—and that is what the New Zealand Law Society tells us—then that clearly raises the justification for a highly prescriptive statutory regime and the impossibility of funding a realistic fidelity fund for such a limited occupational grouping.

Reference is made in other parts of the bill to the fidelity fund, and I am not going to deal with that now. But it is an amazing circumstance that this bill, which in its reported-back state runs to 346 pages, has so much stuff on the New Zealand Society of Conveyancers when it is intended that there might be only seven or eight such people belonging to it. Why is that? Well, it has an ideological history and it reflects the bias and determination of a former Minister of Justice when he was Labour’s spokesperson on justice. The Hon Phil Goff, who was not “the Hon” then, became absolutely convinced that the legal profession’s monopoly on conveyancing should be broken. He spared no effort to try to translate that plan into action. In fact, he sought to introduce into the Parliament a member’s bill to end that statutory monopoly. He said at the time that it was a move that would bring down the costs for homebuyers and sellers.

I shall quote what he said in that context. He said: “The privileged position enjoyed by lawyers in having the sole right to do conveyancing is imposed by law. Today, when most other services have been opened up to competition, there is no justification for continuing this protection. Lawyers have fought strenuously to preserve their monopoly power and undoubtedly will bitterly resist this change. In the end however the self-interest of lawyers cannot be allowed to prevail over the wider interests of ordinary New Zealanders who are consumers.”

It is surprising that the New Zealand Law Society has not been bold enough to stand against the inclusion of conveyancers in this bill. Certainly, some of its members would not wish to see conveyancers forming part of this legislation. The reality, of course, is that events have moved on. At the time when Mr Goff articulated those concerns, there were scales of charges for types of conveyancing transactions. Those scales of charges have now been swept away and the reality is that conveyancing operates on very much a cut rate and a cutthroat basis. So if there were a so-called premium to be taken from carrying out conveyancing work, that premium has now long gone.

In fact, in some ways the legal profession, in its pursuit of competitive interest, has so priced conveyancing that for many law firms it is simply not cost-effective to do that work. There also was, underlying the stance taken by the Minister, a naivety that conveyancing was no more than the simple transfer of property from one owner to another. But it is much more than that, and although lawyers in the conveyancing context are involved in the selling of land from seller to buyer, there is much subtlety in the conveyancing task. That subtlety and the work that is done in sophisticated leases, easements, and other interests of land was wholly overlooked.

That is why National has persisted, apparently against the wish of the New Zealand Law Society, to maintain this monopoly for lawyers—albeit many lawyers will not seek, and will never seek in the future, to carry out conveyancing work. But there it is. The New Zealand Society of Conveyancers, established by this bill, is to have pride of place alongside lawyers, and the seven or eight people will be tasked by this—in my view—unknowing and unwise Government to set up a structure of control, including a fidelity fund.

Part 2 deals with restrictions on the provision of legal services and conveyancing services. But what will that mean to the public of New Zealand? As a layperson, I am not particularly interested in the law, or in lawyers and much of what they talk about. To me as a layperson, most of what lawyers do is not even vaguely relevant. But I, Joe Public, like the sound of a bill that states its purposes are to maintain public confidence in the provision of conveyancing and legal services, to protect the consumers of those services, to recognise the status of the legal profession, and to establish a new profession of conveyancing practitioners. I feel better when I think that someone is protecting my rights and that that person is a professional.

The chances are that the only time I will interact with lawyers is when I intend to buy a house, and when I do that I want the matter to be dealt with efficiently, effectively, and cheaply. I want someone to make sure I do not make a terrible mistake. I want to pay for, and get, what I am expecting. I do not want to pay the wrong person. I do not want to have the surprise of discovering that a motorway is to be built right next door, and I do not want my money to disappear during the transaction. I want to be very sure that in the future I will have a clear title to the property. Buying a house will probably be the biggest purchase of my life, and, up until now, like most New Zealanders, I have trusted a lawyer to do that for me. The system has worked pretty well. Sure, there have been glitches, but in comparison with land courts in other parts of the world, we do well.

Part 2 of the bill defines who can be a lawyer and how he or she can practice. It outlines the penalties for people who pretend to be something they are not. As a layperson, that is important to me. I need to know that those whom I employ are qualified to advise me well, and to protect me and my property. The bill also defines who can do my conveyancing services. As a layperson, it is all the same to me, as long as the job is done properly. The bill requires that both lawyers and conveyancers have a practising certificate, and as long as the New Zealand Law Society and the New Zealand Society of Conveyancers do the job properly and ensure the required standards are met, I am a happy consumer. From my point of view, I want to receive professional advice at the right time, at the right place, and without excessive cost.

The question was put that the amendment set out on Supplementary Order Paper 344 in the name of Dr Richard Worth to the heading to Part 2 be agreed to.

I seek leave for all Dr Worth’s amendments to clause 28 to be taken as one question, and not to have individual votes on them.

The CHAIRPERSON (Hon Clem Simich): Leave has been sought for that to happen. Is there any objection? There appears to be none. We will proceed as we have agreed.

The question was put that the amendments set out on Supplementary Order Paper 344 in the name of Dr Richard Worth to clause 28 be agreed to.