LawNews - Issue 16 | 2023

Tony Herring: Stand up and be COUNTED

Contents

ADLS President Tony Herring on regulation, complaints, conflicts and the Treaty of Waitangi

LawNews is an official publication of Auckland District Law Society Inc. (ADLS).

Editor: Jenni McManus

Publisher: ADLS

Editorial and contributor enquiries to: Jenni McManus 021 971 598 Jenni.Mcmanus@adls.org.nz

The folly of DIY trusts: a lesson from the Singapore courts

NOTE FROM THE EDITOR

Readers may notice this week’s LawNews is smaller than usual, with the CPD and events pages missing, along with our usual page links. This is because ADLS is scheduled to undergo a major IT upgrade this weekend. While readers will receive LawNews in their inboxes as usual on Friday morning, the magazine will not be uploaded to our website until Monday. We apologise for any inconvenience but hope you will enjoy our shiny new system!

Reweti Kohere 022 882 2499 Reweti.Kohere@adls.org.nz

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©COPYRIGHT and DISCLAIMER Material from this publication must not be reproduced in whole or part without permission. The views and opinions expressed in this publication are those of the authors and, unless stated, may not reflect the opinions or views of ADLS or its members. Responsibility for such views and for the correctness of the information within their articles lies with the authors.

Inaugural message from ADLS President Tony Herring

For my inaugural message to members, I’d like to focus on what in my opinion is the most significant issue facing lawyers: the recommendations of the independent panel tasked with reviewing the legal profession. New Zealand’s 16,000 lawyers, including ADLS members, and members of the public have until next Wednesday (31 May) to submit to NZLS their response to the panel’s recommendations. NZLS says it will process and collate this feedback and then present its response to Justice Minister Kiri Allan. New legislation will be required to effect some of the panel’s more radical recommendations.

The panel has produced a mammoth 190-page report but I’d urge you not to be daunted by this. My message is twofold: do your best to read the executive summary and, if you haven’t done so already, have your say. This might be as simple as sending an email and I would suggest you send it direct to NZLS rather than a local branch committee.

You need to inform yourself about these issues because the panel’s recommendations have the potential to make massive and fundamental changes to the way the legal profession is regulated. And that will have a trickle-down effect. If you want to be a member of a profession such as ours, I think it’s important for you to become involved.

There’s a danger that the sheer volume of emails landing in your inbox means important messages about these proposed changes may have been deleted or ignored, particularly when times are a bit tough and work might be a bit hard to come by. That has to be your focus.

But the issues raised in the independent panel’s report are so important that if people don’t respond, then the minister or whoever is ultimately making the decisions for our profession could reasonably assume that people are happy with the panel’s recommendations.

Just do it. Even if you submit on only one issue or pick an issue that you’re passionate about or one where you have a very strong view. The more people who comment, the more engaged we become and the more likely we are to end up with an outcome that’s acceptable. But if we’re all too busy or apathetic, then we’re leaving it up to external decision-makers to make big calls that might not work out to be in our best interests.

Regulation

I personally struggle to understand how the panel can claim that an independent regulator would be significantly cheaper than the cost of the current system which runs on volunteers, apart from a couple of laypeople on the standards committees. How on earth can it be cheaper? It doesn’t make sense to me.

I also have concerns about the mixed messages coming from both the panel’s initial consultation document and the survey provided recently through which lawyers could give feedback on the proposed changes. It seems to me that the way the questions were framed in both documents predetermined a certain type of answer. So, it’s important to understand that you are not limited by the NZLS survey – you can send feedback in any form you choose.

Continued on page 04

Tony Herring

Tēnā koutou katoa. Ko Tony Herring taku ingoa. Ko ahau te Perehitene o ADLS. Nga mihi nui ki a koutou katoa.

The more people who comment, the more engaged we become and the more likely we are to end up with an outcome that’s acceptable

Complaints

I was on a NZLS standards committee for nine years. And before the legislation changed I was on a complaints committee. My personal view is that the complaints system is working pretty well and I think there’s a huge risk that having an independent regulator will take away all of the institutional knowledge that exists within the profession, along with the empathy.

“Empathy” is a big word for me around the complaints system. I was on a fantastic standards committee in Canterbury Westland and we had a range of wonderful people on the committee who were empathetic and understood the pressures lawyers face in our day-to-day practice.

So if something goes wrong, these committee members would understand the context of, for example, what happens on a Friday afternoon in a busy conveyancing practice. They can bring to bear all that skill, all that experience and all that empathy when they reach their decisions.

Having said that, there are a couple of things with the complaints system that are not ideal: chiefly the time it takes to get a decision out. And there has also been a lot of talk about a lack of ability to triage complaints. So, even the most trivial complaint has to be entered into the system and referred to a standards committee.

In my view, if they put more resource into complaints and had an effective triage system so gripes about clearly inconsequential issues didn’t make it to the standards committee, then nothing else is actually wrong. I think the quality of the decisions is fantastic. There could be more consistency between the various standards committees but that’s not a huge issue. Other than that, if it ain’t broke, why fix it? But there does seem to be quite a determination on the part of the independent review panel that independent regulation is the only way to go.

Opportunities for ADLS

As a representative organisation, ADLS is watching all this unfold, thinking about the opportunities that might emerge. For example, if NZLS is no longer the regulator and is forced to reinvent itself as solely a representative organisation, presumably membership of NZLS will no longer be compulsory. So, a lot of those members may then be looking around for other options.

I’m really proud of ADLS. We’ve recently refreshed our strategic plan and our purpose is to be the best member organisation for the legal profession. That’s our goal, regardless of the outcome of the review.

In my opinion, it is possible that NZLS may well cease to exist as a result of a review that it instigated itself. And for what purpose? I acknowledge bad things were happening in isolated pockets of the profession but in my view they were being dealt with by the disciplinary process already in place. The practitioners found guilty have been called to account and have been suspended from practice for lengthy periods of time or publicly named. Changes have been made to the way the profession is regulated to directly address the issues that have occurred.

Conflict of interest

So, why do we need an entirely new regulatory system? What is so broken that an entirely fresh start is needed with people who are appointed by a minister?

That is another good point. The minister appoints the members of this “independent” regulatory board and the minister has to take advice, but she doesn’t have to accept this advice. She will get some recommendations from a panel. But if she doesn’t accept those recommendations and she decides to appoint certain people who hold certain views, that’s a huge conflict of interest.

I don’t buy the argument that lawyers should be regulated independently, like doctors or plumbers and

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I personally struggle to understand how the panel can claim that an independent regulator would be significantly cheaper than the cost of the current system

I don’t buy the argument that lawyers should be regulated independently, like doctors or plumbers and drainlayers or physios

drainlayers or physios because we are in a very different position. We have fundamental obligations to uphold the rule of law. If there are independent regulators who don’t understand how we do that or what the nature of our role is, then they could make very poor decisions.

The treaty

I have a reasonable grasp of te reo Māori, having studied it at high school in Rotorua, and can still get a pass mark if I’m meeting with an iwi. But why elevate compliance with the principles of the Treaty of Waitangi to an absolutely fundamental obligation when it will have no impact, I would think, on 75% of what lawyers do on a day-to-day basis?

I can see how that might relate to some areas of practice, but if I look at my desk and the various tasks I will be doing today, none of them has any connection whatsoever with the treaty.

How do I demonstrate compliance with a fundamental obligation under my governing legislation when it’s simply not relevant to the work I do? It doesn’t touch on a renewal of a lease for premises in a commercial building, for example, nor a request to review a construction contract for an office building fitout.

My vision

At ADLS we do some great work in terms of our forms, our CPD, our collegiality functions and our committee structures. At a high level, I want to continue this great work and make some improvements. One example will be developing a closer relationship between the committees and the ADLS council.

The council has a strategic plan with a vision about who we want to be as an organisation and we need to bring all of the committees along with us. There are 17 committees full of amazing practitioners who are all engaged in the profession and in what they do. But I think we could make that relationship a bit closer.

And I’d like to get around the country, talking to members and telling them that we exist to help them achieve excellence and asking what they need from us on a day-to-day basis.

I want to hear from our members about what they think we could do differently or what we could do better. And then I would be committed to doing something about it. So that’s the first thread.

The second thread is about looking at things that might impact on professionals that we don’t yet fully understand. An example might be AI. I don’t know much about it, I’ve never looked at ChatGPT, although it’s on my list of things to do. It’s all about getting ahead of the curve.

On another note, there are signs that the profession might be starting to shake off the post-covid malaise. We are refreshing the ADLS Friends panel and have had about 80 applications within a couple of days. It was so popular, we had to close applications early.

I am very proud to be President of the great organisation that ADLS is. I want to help foster a greater sense of connection and collegiality within the profession and I want to help shape the future of the profession. I am always keen to chat to our members about what we do, what more we can offer and how we can help you achieve excellence every day. Please feel free to contact me at president@adls.org.nz if you want to talk.

You should also have received an email from TRA on 22 May, with a survey link. We are very keen to receive as much feedback as possible from our members about what you need. Please do take the time to complete the survey. This will enable us to direct our resources in the best way to meet your needs. We are here to help you and your feedback will enable us to best do that.

Ngā manaakitanga ■

How do I demonstrate compliance with a fundamental obligation under my governing legislation when it’s simply not relevant to the work I do?

There does seem to be quite a determination on the part of the independent review panel that independent regulation is the only way to go

Do we need criminal law?

For example, punishment may deter the offender from reoffending. It may deter others from offending. It may incapacitate the offender to prevent them from offending again. And it may rehabilitate the offender, encouraging them to change their behaviour in future.

When judges sentence, they usually consider all these objectives to some degree. In England and Wales, s 57 of the Sentencing Act 2020 tells judges that, in adult criminal cases, they must have regard to the following purposes of sentencing:

Criminal law has been a cornerstone of legal systems across the world for centuries. Its purpose is to provide a framework for defining and punishing behaviour that is harmful to society.

But criminal law has never been uncontroversial. It is often criticised for serving the interests of the ruling class, repressing the poor, meting out brutality and disproportionately harming people of colour and disabled people.

We will take a critical look at criminal law and examine alternative models of justice that prioritise repairing harm, addressing the root causes of criminal behaviour and promoting community healing.

We will explore restorative justice, community-based justice and transformative justice and consider their potential as alternatives to criminal law. We will look at critiques of the criminal justice system from both abolitionist and reformist perspectives. Finally, we will choose between abolitionism and reformism and attempt to answer the central question: do we need criminal law?

What Is criminal law for?

Criminal law differs from civil law in that it is punitive, rather than compensatory. In a civil case, the primary goal is to compensate a person, usually financially, for a wrong done to them. By contrast, in a criminal case, the primary goal is to punish a person – to inflict suffering on him or her by way of retribution for a wrong they have committed.

The deliberate infliction of suffering has always been politically, morally and philosophically controversial. That gives rise to the basic question of why we have criminal law at all.

Broadly, there are two main justifications for criminal punishment. One is retributivist, based on the idea that a person should be punished for their wrongdoing simply because they deserve to be. The other is consequentialist, based on the idea that punishment serves certain positive social ends.

■ punishing offenders;

■ reducing crime, including its reduction by deterrence;

■ reforming and rehabilitating offenders,

■ protecting the public; and

■ making reparation by offenders to people affected by their offences.

Let’s now look at some criticisms of criminal punishment as administered in contemporary societies.

Critiques of criminal law

Critiques of the criminal justice system can be broadly divided into reformist and abolitionist. Broadly speaking, reformist critiques accept that the criminal justice system should continue to exist in some form. They argue for reforms within the system, such as sending fewer people to prison, greater use of alternatives such as non-custodial sentences and restorative justice, better prison conditions and better-funded legal aid.

Abolitionists, by contrast, call for the abolition of criminal punishment altogether. Famous abolitionists include Angela Davis, who wrote the landmark book on the subject Are Prisons Obsolete?, and Mariame Kaba.

Let’s turn to some of the core criticisms of criminal law.

The first critique is that the criminal justice system overwhelmingly criminalises the poor, not the rich. It prioritises the property of the rich at the expense of the lives of the poor.

This is not a new critique. As Anatole France famously said, “The law, in its majestic equality, forbids rich and poor alike to sleep under bridges, to beg in the streets and to steal loaves of bread.” The law itself overwhelmingly penalises actions that are more likely to be committed by the poor, while not penalising the

Continued on page 07

Professor Leslie Thomas KC

Prison is a social environment where prisoners are exposed to pro-criminal attitudes, learn from other prisoners’ behaviour and are incentivised to adjust to prison life and criminality in general

The law itself overwhelmingly penalises actions that are more likely to be committed by the poor, while not penalising the far more harmful actions of the rich

Continued from page 06

far more harmful actions of the rich.

As the criminologist Alex Vitale says in The End of Policing, “the criminal justice system excuses and ignores crimes of the rich that produce profound social harms while intensely criminalising the behaviours of the poor and non-white, including those behaviours that produce few social harms.”

To take a few examples, a homeless person begging in the street is committing a crime but the landlord who made them homeless is not. Stealing a sandwich to feed oneself is a crime but owning a payday loan company that has plunged many families into poverty and hunger is not. Fly-tipping is a crime, but owning an oil company that contributes disproportionately to climate change is not.

The second critique, which is closely related to the first, is that poor communities are the most heavily policed and the state uses policing and incarceration instead of putting the necessary resources into these communities to solve their social problems.

Instead of responding to homelessness by providing housing or responding to mental illness and drug addiction by providing adequate healthcare, we respond to both by locking people up.

In his book, Vitale refers to three homeless men who were killed by police in the United States. He acknowledges that these three men “posed regular threats to public order and in some cases public safety”. He argues, however, that “[t]he use of the police to manage those threats… was largely ineffective and ultimately deadly. These individuals were immune to threats of arrest and incarceration, which they had all experienced in the past. The criminal justice system, with its emphasis on punishment, could not address the underlying and intertwined problems of homelessness, mental illness, and substance abuse that drove their problematic behaviours.”

He goes on to point out that it would be cheaper to provide permanent housing and support services for homeless people than to keep arresting and jailing them. Drug abuse, too, is often linked to poverty. As Vitale highlights, “Many people involved in the drug industry don’t really have a drug problem; they have a job problem. Many others have drug problems that directly stem from the economic conditions they struggle with. There is no way to reduce the widespread use of drugs without dealing with profound economic inequality and a growing sense of hopelessness.”

A third critique of criminal law is its disproportionate impact on marginalised communities, most obviously communities of colour. In the United States context, it is often pointed out that the history of criminal law is deeply rooted in the country’s long history of exploiting and brutalising black people.

For instance, in her book Are Prisons Obsolete? Angela Davis talks about how after the abolition of slavery in the American South, the convict lease system was instituted, where criminalised

black people were subjected to forced labour in even worse conditions than they had suffered under slavery.

Similarly, the influential book The New Jim Crow by Michelle Alexander examines how the modern-day US penal system replicates much of the racism of the former system of racial segregation. She argues that the US imprisons a larger percentage of its black population than South Africa did at the height of apartheid and that ex-offenders are discriminated against legally for the rest of their lives, including through denial of the right to vote. She describes the system of mass incarceration as a “racial caste system”.

The high point of this racial disparity is seen in the war on drugs. Despite similar rates of drug use among different racial groups, individuals from minority communities are more likely to be arrested, charged and sentenced to longer prison terms for drug offences.

Much has been written about the racial disparities in drug policing in the US. Vitale writes, in an American context, that “Drug policing is almost exclusively undertaken in poor, mostly non-white communities. Across the country, most people in prison for drug offences are black or brown.”

President Richard Nixon’s chief domestic policy advisor, John Ehrlichman, reportedly told a journalist:

“The Nixon campaign in 1968 and the Nixon White House after that had two enemies: the anti-war left and black people. You understand what I’m saying? We knew we couldn’t make it illegal to be either against the war or black, but by getting the public to associate the hippies with marijuana and blacks with heroin. And then criminalizing both heavily, we could disrupt those communities. We could arrest their leaders, raid their homes, break up their meetings and vilify them night after night on the evening news. Did we know we were lying about the drugs? Of course we did.”

But this issue isn’t restricted to the United States. An analysis by the Liberal Democrats of Ministry of Justice statistics in 2021 showed black people were 12 times more likely to be prosecuted for cannabis possession than white people. Yet black people are certainly not 12 times more likely than white people to be users of cannabis.

The Adult Psychiatric Morbidity Survey showed 11.7% of black adults, 8.9% of white British adults and 3.4% of Asian adults had used illicit drugs in the past year.

There are also disparities at the sentencing stage. Sentencing Council research covering the period from April 2012 to March 2015 showed black and Asian drug offenders were more likely to be sentenced to immediate imprisonment than white offenders, even after controlling for aggravating and mitigating factors. Asian offenders also received statistically significantly longer sentences than white offenders, although black offenders did not.

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The rate of imprisonment in the US skyrocketed between the 1970s and the 2000s, increasing by over 500%, although it has since declined somewhat

Professor Leslie Thomas KC

Continued from page 07

And race isn’t the only vector of oppression in the criminal justice system. Disability is another huge factor. In my career I have encountered numerous cases in which people in mental health crisis, particularly black men, have been killed by the police. People with mental health problems and learning disabilities are also overrepresented in the prison population.

A third critique of criminal justice is that, even taking its intended purposes at face value, the increased harshness of sentencing in recent decades does not achieve those purposes.

Earlier, we looked at the core consequentialist rationales for punishment: deterrence, incapacitation and rehabilitation. This is in a context where sentencing has become substantially harsher over the past 50 years. The rate of imprisonment in the US skyrocketed between the 1970s and the 2000s, increasing by over 500%, although it has since declined somewhat.

The rate of imprisonment in England and Wales per capita is significantly lower but has also increased over time. The prison population of England and Wales quadrupled between 1900 and 2018, with around half this increase taking place since 1990.

But does this harsher sentencing achieve the goals of deterrence, incapacitation or rehabilitation? Recently, Jay Gormley, Melissa Hamilton and Ian Belton carried out a review of the effectiveness of sentencing for the Sentencing Council of England and Wales. On general deterrence – that is, the ability of sentencing to deter others from committing offences in future – they highlight that “a range of evidence on human behaviours and decision-making lends credence to the idea that certainty of punishment is likely a much stronger driver of deterrence than severity”.

On the effect of sentencing on the individual offender, Gormley and colleagues find that using more severe deterrent sentences (in particular, custodial rather than non-custodial disposals) does not reduce reoffending. On the contrary, researchers have found evidence for the criminogenic effects of incarceration.

Prison is a social environment where prisoners are exposed to pro-criminal attitudes, learn from other prisoners’ behaviour

and are incentivised to adjust to prison life and criminality in general. Further, the challenging events inmates experience, such as loss of autonomy and privacy and victimisation, may trigger psychological strain and provoke criminal coping strategies. Ex-prisoners also suffer from the negative social and economic effects of being labelled as such. They find, in particular, that short sentences of imprisonment “may be criminogenic, hinder positive outcomes, and make reoffending more likely”.

Of course, this is an area where an abolitionist and a reformist response might differ. A reformist might respond to this research by advocating less use of imprisonment, more non-custodial sentences and more diversions such as restorative justice.

They might point out that the research I’ve just referred to doesn’t say that punishment is useless. Rather, it merely challenges the assumption that greater harshness of punishment, as opposed to greater certainty of punishment, increases its effectiveness in reducing crime.

An abolitionist, by contrast, would say that this is simply putting a sticking plaster on the brutality and injustice of policing and prisons, and the end goal should be to abolish criminalisation entirely.

Angela Davis argues that “frameworks that rely exclusively on reforms help to produce the stultifying idea that nothing lies beyond the prison”. At the same time, it would be wrong to caricature abolitionists as blue-sky thinkers.

As the abolitionist Mariame Kaba argues, abolitionists are also involved in campaigns that win politically achievable reforms. She argues that “[a]bolitionist groups have often led fights for better conditions, connecting them to more transformative political possibilities”, and abolitionists have been at the forefront of campaigns such as decriminalising drug use, sentencing reductions and better prison conditions.

So what are the alternatives to criminal law? Are the abolitionists or the reformists right?

Next week we will explore some of the alternative models of justice that have been proposed to address the critiques of criminal law and create a more just and equitable system. ■

Professor Leslie Thomas KC is a lecturer at Gresham College in central London ■

Stealing a sandwich to feed oneself is a crime but owning a payday loan company that has plunged many families into poverty and hunger is not

Why trusts should

governed and administered: a lesson from the Singapore courts

Trusts in New Zealand are often governed by the same people who set them up and benefit from them, sometimes in conjunction with a trusted adviser

In some cases, these people continue to treat the assets of the trust as an extension of the personal assets of the settlor. As a result, some trusts may not withstand scrutiny.

The recent Singapore High Court case of La Dolce Vita Fine Dining Co Ltd v Zhang Lan and others and another matter [2022] SGHC 278 highlights just how important it is for trusts and underlying companies to be property governed and administered if they are to provide the benefits they promise.

Whilst the people and laws are foreign and the value of the assets incomprehensible to most people using, advising or operating trusts in New Zealand, the general principles of this case are entirely applicable.

The facts

In 2013, La Dolce Vita acquired shares in companies beneficially owned by Zhang Lan. The proceeds of sale totalling US$254 million were paid to her personal bank account in Hong Kong. There was subsequently a dispute between La Dolce Vita and Zhang about the acquisition.

In 2014, Zhang established a Cook Islands trust, known as the Success Elegant Trust, for the benefit of her son, his children and remoter issue.

Also in 2014, the day after the trust was established, Zhang transferred the sole share she owned in Success Elegant Trading Limited (SETL) to the trustee of the trust.

SETL had bank accounts held in its name, one at Credit Suisse AG and one at Deutsche Bank AG.

Between March 2014 and November 2014, payments totalling US$142m were made from Zhang’s personal bank account in Hong Kong to SETL’s Credit Suisse account and from this

transfers totalling US$85 million were made to SETL’s Deutsche Bank account.

In March 2015, Credit Suisse AG and Deutsche Bank AG were served with freezing orders directed against Zhang. The bank accounts were frozen.

Zang’s judgment creditors sought to enforce arbitration awards against her. It was contended that notwithstanding SETL’s legal ownership of the bank accounts, Zhang remained the beneficial owner of, or had effective control over, the bank accounts.

The issues

There were two key issues for the court to decide in this case: ■ was Zhang the beneficial owner of the bank accounts, notwithstanding SETL was the legal owner; and ■ could Zhang’s creditors appoint receivers to the bank accounts.

The decision

Was Zhang the beneficial owner of the bank accounts?

Zhang claimed the trust was an irrevocable trust and that she was “excluded completely from any direct or indirect interests derived from the properties, assets and revenues generated under the trust” and held “no rights under the trust, including

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Sarah Kelly & Henry Brandts-Giesen

be properly

Essentially, Zhang wanted the best of both worlds: the asset protection benefits that can be provided by a trust and the ability to use the money in the bank accounts as she pleased and for her own benefit

The court said Zhang had not intended to relinquish her beneficial interest in the bank accounts

Sue Petricevic: from forensic scientist, to expert witness, to prosecutor to defence counsel

At the turn of the millennium, Petricevic led a lot of the initial research into what was then a new field – the ability to extract, from very small samples left behind on door handles, in shoes, or from footprints, a person’s DNA

Reweti Kohere

It’s the one question that Sue Petricevic, lawyer and International Skating Union (ISU) judge, won’t answer: who is her all-time favourite figure skater?

“Can’t say. I’m a judge. Can’t say,” she says, shaking her head. “Won’t say, no.” Not even past skaters? “Not going to, not going to. But my favourite discipline is pairs skating. I love the big overhead lifts and the strength of the couples performing together to the music.”

Fair enough. Maintaining impartiality is understandable, whether you’re presiding over a courtroom or from the side of a rink. Having competed in her teens and early 20s, Petricevic turned to judging, working her way up from local and national competitions to big-time international meets.

The Vulcan Chambers barrister gets to travel around the world and has formed enduring friendships with other members of the international skating community. But judging, particularly high-level competitions, can be long and tiring – days can last up to 10 hours, with brief 10 to 15-minute breaks.

“It’s total concentration. When you’re judging a big group of skaters, sitting in the cold in a big auditorium, the judges are nervous and excited too because they want to reflect each skater’s performance correctly and fairly. And the judges themselves are also being checked by another panel,” she says.

“You can’t think about anything else. These assignments are not a walk in the park when you’re sitting there, entering up to 14 marks for each skater

in real-time over three or four minutes. That’s a lot of marks.”

Putting her hand up

Petricevic has another responsibility, chairing the ISU’s disciplinary commission – the first New Zealander to be elected to the position.

A commission member since 2012, she was confirmed chair in 2022 for four years, and works alongside four other elected members (from Slovakia, Germany, the US and Canada), two of whom specialise in figure skating, the other two in speed skating and all of whom are lawyers.

She got involved after attending one of the ISU’s congresses as the vice president of the New Zealand Ice Figure Skating Association. Having heard about the disciplinary commission’s work, “I just put my hand up, I started applying. And then, at the same congress, there was a bit of a constitutional crisis and they asked for nine lawyers from different countries to volunteer

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Sue Petricevic

In law, there’s always that beautiful scope for the grey area. With science, not so much

Continued from page 10

and try to sort it out”, she says.

“So, again, little old New Zealand, hand up. I probably wasn’t that long out of law school at the time and was chosen. So, I went in and from there, made connections and was able to contribute to that solution. That helped in my endeavours later on.”

The chair receives all disciplinary or ethical complaints first, from skaters, officials, coaches or team leaders participating in any ISU event, and must sit on every three-member panel unless she has a conflict of interest. The hearing process is more inquisitorial than adversarial, and although decisions are made mostly on the papers, there are also in-person hearings. Parties can appeal decisions to the Court of Arbitration for Sport in Lausanne, Switzerland.

Provided the panel has jurisdiction to hear the complaint, disputes can range from alleged breaches of doping rules to more difficult ethical cases, such as those alleging a judge from one country has rewarded their country’s skaters favourably while giving other countries’ competitors lower marks.

While it’s not the panel’s role to assess a judge’s competency (another arm of the ISU deals with training and accreditation), cases of “national bias” are deemed ethical offences, for which the commission must adjudicate.

“It’s a breach of the code of ethics to behave in a way that could bring the sport into disrepute, not to judge fairly and impartially and to manipulate your marks or try to influence someone else to do that. Those national bias cases are really difficult because they are not always that clear,” Petricevic says.

“It takes a lot of mathematical analysis and evidence, which comes through the technical committees and the referees, and the judges that judge the judges – the Officials Assessment Commission. Then we consider the evidence, decide the case, and, if necessary, determine the sanctions.”

Many hats

Other complicated cases involve blood doping and comparisons with “biological passports”, a high-level athlete’s electronic record that collates and stores, over a period of time, biological markers in their blood.

“If the haemoglobin ratios in the skater’s blood

change, for example, by taking drugs, then they can take in more oxygen, which could give them an advantage in speed and stamina. So their base haemoglobin levels are screened over a long period of time to see if there are any changes,” she explains. “It can be quite medically complex, with arguments over how altitude, genetics and disease could affect these profiles.”

I’m reminded of how many hats Petricevic can wear at any one time: figure skating judge, disciplinary commission chair, barrister and forensic scientist. For 20 years, she worked as a forensic scientist. At the turn of the millennium, she led a lot of the initial research into what was then a new field – the ability to extract, from very small samples left behind on door handles, in shoes, or from footprints, a person’s DNA.

It was ground-breaking work globally which Petricevic continued in France, having earned a senior fellowship scholarship from the Institute of Environmental Science and Research (ESR). Together with a French student, they researched skin-to-skin transfer of DNA.

“For example, imagine someone is attacked and pulled away by an assailant. Can you pick up the assailant’s DNA on their skin? The answer is sometimes; it depends on a whole range of factors. We looked at this as well as saliva transfer, which was an odd project because it involved volunteers planting a kiss on the arm. Then we tried to analyse their DNA. We had to get ethics approval, of course, but there was no shortage of volunteers to assist.”

Different meanings

Petricevic served as a key Crown witness in the 2001 RSA murders case, for which William Bell was convicted and imprisoned, and the 1996 hammer killing of Tania Furlan. Petricevic also helped find the DNA profile that correlated to a suspect’s profile in the 1987 murder of six-year-old Teresa Cormack.

More than 800 samples had been screened by the time Petricevic came to the tail end of likeliest possibilities. And it had taken 14 years for the technology to have advanced enough to test the offender’s semen sample on a microscope slide.

Petricevic says deciding when the right time was to test the samples, was one of the most difficult aspects of the case. “Of course, it’s not a single person’s decision … But there must be a high likelihood of getting a result because this could be the last

opportunity. There wasn’t much sample. When you analyse a sample like that, it is broken down. And then you use most or all of what is left and if that’s the last sample, you want to be jolly sure you’re going to get a result.”

Eventually a profile in one of the last batches returned a match, which was reanalysed for qualityassurance. She remembers the match occurred toward the end of the day, “because we were doing all our other casework. It wasn’t just me, there were technicians working with me as well,” she says. “In fact, they would have been the ones who ran the samples through and then gave me the results, and then I checked all the results. It was a real team effort.”

At the trial of Cormack’s killer, Jules Mikus, Petricevic described the likelihood of obtaining the DNA profiling result they found was at least 60 million times greater if the DNA came from Mikus than if it came from another man chosen at random from the New Zealand population.

It’s a phrasing she always used, “because you have to memorise that because the likelihood ratio, which is the statistic behind a DNA profiling result, is very specific. If you change the words around, it says something quite different…I’m not saying, ‘it’s 60 million times more likely it came from him’ or ‘it’s 60 million times more likely it was him’. It’s neither of those. But what it says is, ‘the likelihood of getting this particular result is X-times greater if it came from him than if it came from someone else in the population’.”

That Petricevic found Mikus isn’t entirely right either. What she found, she says, was a match that correlated to his DNA profile, “at the sites tested. See, the scientist is coming out of me. See the difference between the science and the law? It’s very precise.”

Continued on page 12

I’ve always been interested in criminal law, the broader tapestry of criminal behaviour

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BLASCZAK Salati (aka BLASCZAK, Sally)

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Woon Ping Cheung

• Late of 1157A Dominion Road, Mt Roskill, Auckland

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Continued from page 11

The law

Science and the law are both “extremely analytical”, she says. Scientific research is done because someone is working to discover the way something works or create something new, whereas the law is about looking back at precedents and then developing it in that way. “In law, there’s always that beautiful scope for the grey area. With science, not so much.”

After returning from France in 2004, and having finished her law degree part-time by then, Petricevic left ESR in 2006 and worked as a Crown prosecutor until 2014. Then she spent four years prosecuting health and safety cases for WorkSafe before switching to the defence bar in 2018. She’s also a member of ADLS’s criminal law and health and saftey law committees. Having been an expert witness more than a hundred times in court, giving evidence on drugs analysis and toxicology, crime scenes and bloodstain pattern analysis, and DNA profiling, moving into criminal law was an obvious career move.

“I’ve always been interested in criminal law, the broader tapestry of criminal behaviour, I suppose. Looking at it from the forensics and the crime scenes, then through to prosecution and then the defence bar, you get a broad perspective,” she says.

Her science background proved useful. “At that stage, DNA was still reasonably new so there weren’t that many practitioners who were across it. I certainly had an advantage in understanding it and being able to assimilate it quickly and then pick the holes and know the questions.”

Advocating for defendants has been equally rewarding.

“In the lab, you are an independent expert. You would very rarely meet anyone involved with a case other than occasionally the lawyers and police. Even in the prosecution, you don’t have the same interaction with a client. You’re one step removed from the complainant because you’re acting on behalf of the Crown. Whereas on the defence side, you’re really down there working with the defendant.”

Working with people who are depending on you to help them through the criminal justice system is a privilege, she says. It’s also a responsibility. “You see the effects on the family as well, when someone’s going through the court system to their ultimate conclusion – whatever that may be.”

Petricevic might be a newcomer to the Bar, but with a career spanning the law, science, and sports, she’s one of its most experienced.

Her advice to others contemplating a switch? “If there’s something you really want to do, start setting those goals and then everything will fall into place,” she says. “I really believe that because it’s happened for me so many times.” ■

Offices Available

Following some barristers retiring, we have three offices of varying sizes available for rent.

The Chambers share a refurbished floor (with separate areas) with Hussey & Co., a boutique forensic and general accounting firm. There are shared meeting rooms (a formal boardroom with video conferencing facilities and a less formal meeting room), and communal entrance and client waiting area.

Telephones, internet connection, printing and secretarial services also available and some furniture available.

Cost depends on office size and range from $150 – $300 per week plus gst. No long-term commitment required.

Photographs of the Chambers can be viewed at www.hco.co.nz/gallery. Contact: Shane Hussey for further details, Shane@hco.co.nz 09 300 5481

Continued from page 09

rights to dismiss or appoint the trustee or increase/decrease beneficiaries”.

However, the court found otherwise. It said Zhang had not intended to relinquish her beneficial interest in the bank accounts. Instead, she continued to conduct herself as though the bank accounts were her personal property. For example:

■ she was the sole signatory of the bank accounts;

■ she had unfettered operation of the bank accounts; and

■ she could transfer or withdraw money held in the bank accounts.

Essentially, Zhang wanted the best of both worlds: the asset protection benefits that can be provided by a trust and the ability to use the money in the bank accounts as she pleased and for her own benefit.

Accordingly, the court held that Zhang was still the beneficial owner of the bank accounts.

Could Zhang’s creditors appoint receivers to the bank accounts?

The court held that it was just and convenient, given the circumstances, to allow the appointment of receivers, so the judgments could be satisfied in the most cost-effective and least burdensome way.

Learnings from this decision

As we all know, for a valid trust to exist the ‘three certainties” must exist:

■ certainty of intention to create a trust;

■ certainty of subject matter (ie, assets of the trust); and

■ certainty of beneficiaries.

In this case, when the court was asked “does Zhang (the settlor) have an intention to create a trust?” the answer was clear. Even though she had set up the trust and transferred assets into it, Zhang had not relinquished control of these assets and had continued to behave as though the assets (ie, the bank accounts) were still hers. No genuine trust existed because Zhang had no intention to create a trust. Accordingly, the trust structure afforded her no protection from her creditors who

were able to ‘look through’ the trust structure and make claim to the supposed ‘trust property (being SETL which owned the bank accounts).

Before establishing a trust, settlors should fully understand the consequences of transferring assets to a trust and what is involved in proper governance and administration of a trust. If settlors are not willing to relinquish control and active management of trust assets, then a trust is not the right structure for them.

On a practical level, this means:

■ all trustees should have control of, and access to, trust property (for example, all trustees should be signatories on trust bank accounts and transactions should be approved by all trustees);

■ decisions relating to the trust and trust assets should made by all trustees;

■ all trustees should be actively involved in the management of trust property; and

■ all decisions should be recorded in trustee resolutions or meeting minutes.

It is advisable for all trusts to have at least one independent trustee who is an expert in the governance and administration of trusts. This is especially important if the settlors themselves intend to be trustees as well, as is often the case in New Zealand.

Independent trustees should be actively involved in the management of the trust and trust property and in all transactions. They should not be approached by the settlors at the last minute to ‘sign off’ transactions. None of this is new or should be a revelation those with knowledge of trusts but the La Dolce Vita decision is a pertinent reminder.

Conclusion

Trusts remain an effective structure for asset protection and succession and wealth planning if they are established, governed and administered properly. However, this case serves as a warning about what can happen when a trust is not properly governed and administered. ■

Sarah Kelly is a senior associate and Henry Brandts-Giesen is a partner at Dentons Kensington Swan ■

Independent trustees should not be approached by the settlors at the last minute to ‘sign off’ transactions