Lawyer ordered to repay non-existent tax he charged clients

Clients were charged a "Land Transfer Tax". Photo / File

A lawyer who charged clients a non-existent tax has been ordered to repay them and reduce his fee.

A lawyers standards committee found the man had charged clients a $100 disbursement for either a "Land Transfer Tax", "Land Transfer Tax Statement" or "Land Transfer Tax Statement for LINZ" when no such tax exists.

The lawyer admitted the $100 charge, which was implemented for around 22 months during which time 240 invoices were issued, had been introduced to recover the extra time spent on the establishment of identity steps required by the introduction of anti-money laundering legislation.

In addition, he accepted there had not been any payment to a third party for a land transfer tax or completion of a land transfer tax statement, and that he had been wrong to record them as such on his invoices.

The committee found the lawyer had breached rule 11.1 of the Lawyers and Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008 (RCCC) which states a lawyer must not engage in conduct that is misleading or deceptive or likely to mislead or deceive someone.

The committee also found unsatisfactory conduct by the lawyer for:

• failing to adequately disclose to clients in his letter of engagement that he would charge extra fees to cover additional overhead costs;

• failing to adequately disclose to clients in his letter of engagement that he would charge them separately for recovery of office expenses such as forms, postage and communication;

• Failing to provide adequate GST invoices to his clients.