ADLS Annual Report 2021 - 2022

ANNUAL REPORT 2022 For the year ended 30 September 2022

Our mission is to connect New Zealand’s lawyers and keep them at the forefront of developments in the law and legal practice.

Whether it’s contributing to the development of new legislation, informing the profession about significant new laws, or supporting the courts and the justice system to operate more effectively during the COVID-19 era, ADLS is recognised and respected for its collective knowledge, insights, and collaborative approach. We bring together the sector’s brightest in the country’s largest volunteer membership organisation for lawyers. We’re proud to serve members from across the country and to further the standards and reputation of the legal profession in New Zealand.

Contents President’s Report

4

CEO’s Report

6

Membership

8

Events

10

Committees Update

12

Connecting with the Profession

15

Continuing Professional Development

16

Council Profiles

17

Judicial and King’s Counsel Appointments

18

Financial Statements

22

3

Marie Dyhrberg KC President

President’s Report Over the past year, I have spent considerable time thinking about how ADLS is meeting the needs of its members and the wider New Zealand legal sector.

I feel it is important we heed the lessons from the pandemic and lockdowns. Let’s take the good side of the past year and apply it to being more effective and efficient in what we do. We need to focus on moving forward and progressing with these learnings.

What has become apparent, is the need to let go of some of the cumbersome processes we engage in, and serve and utilise our courts, business, and clients more effectively.

We now have different ways of communicating – whether that be via video conferencing or executing documents online. We need to continue to redefine administrative processes, but at the same time, not lose touch with the human side of what we do.

Working in our various legal roles, and dealing with clients, we must ensure they feel they are getting productivity and quality time. We have a need for face-to-face time, whether that be in person or via video, and spend time with our clients so they feel they are getting something meaningful and worthwhile from us. We need relationships with clients that are built on trust.

ADLS continues to innovate and evolve. Financially, we are in the strongest position we have been in for many years.

This year we finalised the sale of Chancery Chambers; the proceeds have been professionally

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I embrace an evolving court system that delivers all these key attributes. We have an established and trusted relationship and hybrid is working well. And that is where ADLS works hard to bring about the best.

invested with Forsyth Barr in a conservative fund to increase their value whilst a new premise is sought and major contingent liabilities of owning Chancery Chambers have been eliminated.

ADLS is bringing about change As an organisation, we have moved on from being a landlord to increasing our focus on the provision of leading services to the New Zealand legal sector.

Our national footprint allows us to engage with members regardless of where you live; we understand you have different needs. This has been echoed by our Members in my post-lockdown travels around New Zealand to industry events. Our membership is growing, and we are committed to delivering to the individual needs of all members.

Over the past 12 months, I along with the Council have been focusing on our strategic direction and purpose. As a result, we are setting in place a renewed direction for ADLS that will reward

our Members, attract new members, and set the organisation on the path for further growth.

I am proud of ADLS, the services we offer and how we continue to evolve. We are industry leaders in CPD training, and collegiality events.

Our Committees continued their outstanding work with submissions, input into Government, developing working relationships with external parties, and providing good advice. ADLS Committees came together to lodge a detailed submission to the Independent Panel Review on Regulating Lawyers and Legal Services, of which the outcome is pending. Strong submissions were also made on a range of other legal topics.

Meanwhile, our ADLS publication LawNews continues to reach more people both in and outside the profession. Our leading-edge opinion pieces and content is well read and recognised. It is putting us on the must-read list, which is gratifying.

My personal goal has been to build on and maintain the recognition ADLS gets from the judiciary and Ministry of Justice connections, the government and government bodies. I have been actively involved in the Heads of Bench working group, that was established during the pandemic, to further provide a strong voice for the legal profession. We have a clear objective to enhance and improve the effective running of the courts and access to justice.

Farewell As I complete my third and final term, this is my last report as the ADLS President. I am confident I am leaving the organisation in a strong position to move forward. It is a valuable time for ADLS; our focus is on providing outstanding services to members. I am confident ADLS can achieve above and beyond its current mandate.

ADLS will continue to carry on great initiatives that will be carried forward by the Council. Under the next presidency there will be some innovative and exciting initiatives. We will be stretching national membership

ADLS is highly regarded as a strong voice to maintain access to justice across the board. I feel the system is in a much better place.

to providing more services New Zealand-wide. Our focus is on servicing our membership and increasing to understand the needs of the profession.

Thank you to everyone who helps makes the ADLS what it is today. To my fellow Council Members, my thanks for your tireless contribution. To the ADLS team, strongly led by Sue Keppel, during what have been challenging times, thank you for continuing to push the boundaries and delivering excellence, time and time again. And thank you to the Committees, presenters and educators who give their precious time freely and help shape our industry. And finally, our Members - ADLS would not be where it is today without you – thank you for your unwavering support and commitment.

It is an exciting time for the ADLS, the Council and the new president. I feel I am leaving the position in an excellent state for someone to take over the helm.

It has been a privilege and pleasure to be of service.

Sincerely,

Marie Dyhrberg KC President

5

Sue Keppel CEO

CEO’s Report Given the ever-changing landscape of the pandemic, ADLS has continued to grow and move forward on key initiatives over the past year. What is apparent are the opportunities which have come about because of the disruptions experienced; these have supported the change in the way we do things which has increased our effectiveness as an organisation.

As highlighted in last year’s report, we had a strong mandate to sell Chancery Chambers and the sale was completed in July 2022. We continue to exercise our leaseback options at Chancery Chambers while we investigate potential alternative premises to purchase.

Over the past year we have focused on further developing the strategic direction for ADLS, identifying our priorities, and creating a roadmap for growth. Membership is at the core of ADLS; having the right mix of products and services to meet the industry at all career stages is paramount. We have invested considerable time in ensuring our member data accuracy, which will position us well for a change in database systems in 2023. Delivering real benefits that support and enhance our membership is mandatory to achieve our growth goals.

Our CPD courses are industry-leading and the move from offering in-person to online and on-demand learning has enabled us to service more people in the profession. Facing everyday disruptions due to lockdowns, the ADLS team delivered learning events to more than 7,500 participants either online or in person. Moving to a hybrid model, our flagship Cradle

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to Grave™ conference was delivered New Zealandwide, to outstanding reviews.

Connection and bringing the industry together is vital; being able to catchup in person and talk with Members and peers is an important part of what we do.

Over the past year ADLS has reviewed the way it runs its events, recognising the importance of making connections for career-building, mental health, and well-being. Our collegiality program recommenced in full, at the end of June, with 13 events held across New Zealand from Auckland to Christchurch, from Hawke’s Bay to Wellington.

We again hosted lawyers’ lunches; the Immigration Minister Michael Wood at the annual Immigration dinner and the Attorney-General, the Hon. David Parker for a profession-based Q&A breakfast meeting.

The ADLS took the lead in bringing the legal community together in August to honour the passing of HM Queen Elizabeth II with a ‘Toast to Her Majesty the Queen’, recognising an important time in our history. Our events are well attended and topical – a testament to their success. I am enthusiastic about what we plan to deliver in the coming year.

The work of the ADLS Committees this year has been impressive and significant. We run 18 Committees, supported by over 200 members, giving their time freely to helping us impact and shape the legal sector. Our Committees came together to provide input into a submission to the Independent

Review Panel, examining how lawyers and legal services should be regulated and represented in New Zealand. Strong submissions were also made on the Digital Strategy for Courts and Tribunals and possible changes to notification rules under the Privacy Act 2020. Looking ahead, we have laid the groundwork for future positive impacts by our Committees across all sectors of the law.

Arising from the challenges of the past year has been the speed at which technology is changing the way we interact and do business. Four years ago, ADLS committed to delivering a digital signing product for the legal sector. Unfortunately the significant expansion of the digital signing market, particularly since the pandemic, has resulted in us retiring our own product build during the year with the view to possibly partnering with a digital signing specialist for future growth.

Members funds are now $21.6M. This is backed by investments held by Forsyth Barr of $17.5M and cash reserves of $4M. The unknown but substantial contingent liabilities associated with Chancery Chambers have been eliminated. Operationally, ADLS made a surplus before tax of $588k. Our legal forms revenues have started to be impacted by the decline in house sales, but still holding to expectation.

ADLS is made up of a resilient and highly dedicated team. The development of a new hybrid workforce model, involving a combination of remote and onsite working arrangements, offers ADLS team members flexibility, well-being and balance while still maintaining productivity and engagement.

that is progressive and innovative whilst maintaining the best interests of our members. Thank you to the ADLS staff for their energy and dedication to making our organisation the best it can be every day.

Crucial to our successes are the contributors who come together to make the ADLS great. My thanks to you all – from our Committee Members, Conference and CPD speakers and volunteers. The valuable time and energy you contribute to ADLS and the profession is recognised and very much appreciated.

I wish to acknowledge with thanks the contribution of our President Marie Dyhrberg KC who completes her third and final term as ADLS President in March 2023.

And finally, thank you to our Members, whose ongoing commitment, support, and engagement makes ADLS a leading industry association.

We look forward to working with you again next year.

Sue Keppel Chief Executive Officer

Our 2021 employee survey shows high engagement and support for our organisation values. Coming together to achieve the best outcome for our members, during a challenging time, has enabled our team to remain connected and enhance the quality of our services. As an organisation we share a vision

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Membership As a nationally focused organisation, ADLS serves and welcomes members from all over New Zealand.

Despite another challenging year, our member base has remained strong and has in fact grown on FY21 membership numbers.

Contrary to expectations, 2022 continued to be a challenging year as we contended with lockdowns and volunteer burnout. Our membership approach then became to listen even more closely to what our members wanted from us and then deliver time and time again. This strategy has paid off as overall membership increased over three percent in comparison to the last period.

This increase in membership has largely come from

the conversion of non-members into members, validating our efforts to better communicate the value of an ADLS membership.

A big part of increasing the appeal of membership to non-members is effective and relevant communication. With this in mind, we completed several projects designed to reduce the number of individuals in our database with incomplete details.

This allows us to connect members with CPD and event opportunities in their area, increasing value to members.

FY23 will bring more of these projects as we continue to make our data more robust so we can better service our members.

Membership analysis 5000 4000 3000 2000

41%

44%

46%

45%

51%

46%

46%

1000 0 FY16:

FY17:

FY18:

FY19:

FY20:

FY21:

FY22:

4,235

4,427

4,738

5,108

5,232

4,819

4,970

(41% outside of Auckland)

(44% outside of Auckland)

(46% outside of Auckland)

(45% outside of Auckland)

(51% outside of Auckland)

(46% outside of Auckland)

(46% outside of Auckland)

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Membership outside of Auckland (Excluding students)

Auckland 2,419 Outside of Auckland

2,068

4,487

Membership by region (Excluding students)

Auckland

Bay of Plenty

Canterbury

Gisborne

Hawke’s Bay

Manawatu-Whanganui

Marlborough

Nelson

No address

Northland

Otago

Southland

Taranaki

Tasman

Waikato

Wellington

West Coast

Overseas

9

Events Our collegiality programme recommenced after the vagaries of Covid and the Auckland lockdown, at the end of June 2022. In the following months, we held 13 events across New Zealand. From Auckland to Christchurch, from Hawke’s Bay to Wellington, we engaged and connected with our members.

Making connections is not only an important skill in career building, it has also become a cornerstone of our mental health and well-being. During the pandemic, the loss of connectivity was highlighted as being a major source of anxiety and depression.

The relief felt by our members in being able to freely associate again cannot be underestimated.

We hosted the Immigration Minister, Michael Wood, at the annual immigration dinner in November 2021.

This was a great success and a chance for immigration practitioners to speak directly to the Minister. Another high-profile event, the annual Attorney-General (AG) breakfast in December 2021, was well attended and again offered a valuable opportunity to meet the AG and connect with members of the profession. In August, Auckland Members gathered to toast the memory of HM Queen Elizabeth II and herald in King Charles III. ADLS took the lead in bringing the legal community together at an important time in our history and lifetimes.

Our lawyers lunches and sundowners form the backbone of our full events programme. These were refreshed by the addition of the Express lunch, which enabled more networking opportunities.

1/

(left to right) Adam Neylon, Marie Dyhrberg KC, Louise Smith at the Christchurch Lawyers’ Lunch

2/ (left to right) Renee Duncan, Car San Diego, Renee Harley at the Tauranga Lawyers’ Lunch 3/ (left to right) Stephen Pascoe and Andrew Skinner at the Central Auckland Express Lunch

1

2

3

The Toast to the Queen was such a great event. So fresh and exciting and in such a beautiful location. It is so important as a profession to gather to mark these occasions.

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4

5

6

7

8

9

10

11

4/ (left to right) Julia Trautvetter, Erin Mogford, Marie-Terese Parker, Tara Huckle at theHawke’s Bay Lawyers’ Lunch

9/ (left to right) Sir Anand Satyanand, Julie-Anne Kincade KC at the Toast to the Queen Event

5/ (left to right) Marie Dyhrberg KC, Rae Nield, Joanna Pidgeon at the Central Auckland Lawyers’ Lunch

10/ (left to right) Simon Scannell and Richard Cross at the Hawke’s Bay Lawyers’ Lunch

6/ (left to right) Jason Hendricks, Tom Pilley, Matthew Thompson at the Central Auckland Lawyers’ Lunch

11/ (left to right) Julie Goodyer, Arthur Loo at the Toast to the Queen Event

7/ (left to right) Anna Humphries, Karen Lloyd at the Central Auckland Lawyers’ Lunch 8/ (left to right) Melanie Morris, Jessica Daly, Hannah Blewden at the Takapuna Lawyers’ Lunch

11

Committees Update 18

committees represented by over 200 members.

General update  Majority of ADLS Committees provided input and perspectives on the following submissions:  Independent Panel Review on Regulating Lawyers and Legal Services  Digital Strategy for Courts and Tribunals  Possible changes to notification rules under the Privacy Act 2020.

Overall, the work of committees this year has been impressive. Details on a selection of their work follows.

AML/CFT LAW COMMITTEE • This Committee was formed in November 2021 in response to the AML/CFT Act Statutory Review 2021, a consultation administered by the Ministry of Justice under s 156A of the AML/CFT Act. • Met with the Ministry of Justice and made extensive verbal submissions on the AML/CFT Statutory Review, with early signs that the proposed solutions would be adopted as recommendations in the Ministry of Justice’s report to the Minister in June 2022.

• Reviewed the newly published DIA’s Approach to Regulation of AML/CFT & Guide to Compliance and Enforcement Activities documents.

COURTHOUSE LIAISON COMMITTEE • ADLS was notified in January 2022 of damage to the historic books collections stored in the NZLS Auckland High Court library. The

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Committee has met to consider potential solutions for this matter.

CPD COMMITTEE • The Committee oversaw activities, covering a range of areas of practice, ages and stages.

• Thought was given to ensuring a mix of blackletter law, legal skills and more general skills.

CRIMINAL LAW COMMITTEE • Significant engagement with various stakeholders including the Police, the Ministry of Justice, the Courts, Privacy Commissioner, Legal Services Commissioner, and the Department of Corrections.

• Comprehensive submissions, including: Three Strikes Legislation Repeal Bill in January 2022, to the Court of Appeal for the matter Hanara -v- R (CA63/2009) on 15 March 2022. Made oral and written submissions to Parliament’s Justice Select Committee on the COVID-19 Response (Courts Safety) Legislation Bill, advocating for permanent changes to allow for more remote participation in Courts.

DOCUMENTS AND PRECEDENTS COMMITTEE • The Committee, in conjunction with the Agreement for Sale and Purchase of Real Estate Sub-Committee, continued the task of comprehensively reviewing and updating documents.

• The ASPRE Eleventh Edition 2022 went live on ADLS and REINZ platforms in February 2022 following which the Eleventh Edition 2022 (2) of the ASPRE was drafted to include the Te āhui o Matariki Public Holiday Bill which was passed into law.

• The Sixth Edition 2022 of the Tender and Auction Agreements were updated, bringing them in-line

with the ASPRE 11th Edition 2022 (2). Release dates were Sale and Purchase by Auction, Sixth Edition 2022 – 28 June; Sale and Purchase by Tender, Sixth Edition 2022 – 19 July; Agreement for Sale & Purchase of Real Estate, Eleventh Edition 2022 (2) – 19 July.

EMPLOYMENT LAW COMMITTEE • Continued to cultivate good working relationships with the Employment Court and the Employment Relations Authority.

• Made a submission to MBIE on the proposed New Zealand Income Insurance Scheme in April 2022, filed a submission on the Fair Pay Agreements Bill in May 2022. Filed submissions on the Employment Relations (Extended Time for Personal Grievance for Sexual Harassment) Amendment Bill in July 2022 and made oral submissions to Parliament’s Workforce and Education Select Committee.

A submission to the Independent Review Panel raised the matter of resourcing to get through the backlog of cases, including that lawyers should be required to do pro bono work each year to fulfil renewal requirements.

ENVIRONMENT & RESOURCE MANAGEMENT LAW COMMITTEE • The Committee monitored significant policy and legislative developments during the year and contributed to a wide range of CPD events for the profession on a range of issues.

• Focused on recent case law and local government policy developments including the Supreme Court judgment on offshore underwater mining and the government’s obligations under the Treaty of Waitangi.

• Filed a submission to the Chief Environment Court Judge on the revised Environment Court Practice Note in August 2022.

FAMILY LAW COMMITTEE • The Committee continued to stay informed of operational matters concerning the Family Court and provide useful updates to LawNews. Also engaged in closer collaboration with NZ Bar Association Family Law Committee and Te Hunga Roia o Aotearoa Family Law Committee.

HEALTH & SAFETY LAW COMMITTEE • Commenced a more collaborative approach to potential areas for improvement in Health & Safety law to WorkSafe NZ. • Continued to make progress on various items within the 5-year review of the Health & Safety at Work Act. • Filed individual submissions to the proposed inclusion of Health & Safety professionals as “private investigators” and requiring a licence under the Private Security Personnel and Private Investigators Act 2010.

IMMIGRATION & REFUGEE LAW COMMITTEE • Continued to foster good working relationships with Immigration New Zealand and sent two representatives to the fortnightly Immigration New Zealand Operations meetings.

• Approached by Rainbow Law on human rights issue concerning international students. Prepared a letter to support Rainbow Law to the University of Auckland’s Law School.

• Resolved to work with the Immigration & Protection Tribunal on the digital strategy of that tribunal.

MEMBERS SPECIAL FUND COMMITTEE • The MSF Committee continues to consider applications from eligible Members for financial support in circumstances of hardship and friendship.

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MENTAL HEALTH AND DISABILITY LAW COMMITTEE • Wrote to the Auckland District Health Board on the need for an updated interview procedure in mental health units for when a patient reports physical or sexual abuse to staff, a standardised process for providing patient files in preparation for mental health hearings and the lack of private interview facilities for lawyers and clients at the main mental health unit at Auckland Hospital.

• The Committee focused on the ongoing difficulties of conducting hearings via AVL as opposed to in person and raised this with the Family Court Committee via committee member Judge Recordon.

NEWLY SUITED COMMITTEE • The Committee focused on important issues such as diversity and well-being for junior lawyers, support received when going through the admissions process and, attrition rates of law students and junior lawyers. Discussions about mandatory mentoring for one hour each month as part of CPD requirements, with junior lawyers having more structured CPD on mandatory topics such as complaints, review of disciplinary procedures and general legal ethics.

• The Committee provided input to the submission on Digital Strategy for Courts & Tribunals.

PAROLE COMMITTEE • The Committee continued to voice, on behalf of all practitioners, the issue of Counsel access to clients in custody, which had been made difficult by the Department of Corrections since the start of the pandemic.

• Engaged in a special meeting with Sir Ronald Young, Chair of the New Zealand Parole Board, on a range of topics including access to prisoners and the timeframe in returning to Parole hearings in person; access to programmes; timeframes for filing submissions with the Parole Board panel; quality of psychiatrist reports and; questioning style of some Parole Board members and what is appropriate.

PROPERTY DISPUTES COMMITTEE • The Committee continued to provide a wellinformed and cost-effective means of resolving a wide range of disputes relating to property issues.

• Received positive feedback from counsel who filed a dispute on the process and quick turnaround of the final decision.

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PROPERTY LAW COMMITTEE • Discussions about how self-isolation requirements had impacted on settlement of property transactions. Observed the general trend of reduction in volume in the property market resulting from the amendments to the Credit Contracts and Consumer Finance Act 2003 coming into effect, as well as the legal implications of rising costs and increasing difficulties in accessing building materials on new builds and developments.

• Engaged significantly with LINZ on reducing processing times of Title and Survey transactions.

Also, on communicating to practitioners the go-live rollout of the Notice of Change of Ownership for Auckland Council on Landonline.

• The Committee’s Retirement Villages sub-committee attended the Retirement Commissioner’s briefing in Wellington in August.

• Had a major role in the preparation and delivery of the Unit Titles half-day conference in September.

TECHNOLOGY AND LAW COMMITTEE • The Committee focused on the volume of new legislation being enacted including Harmful Digital Communications; Digital Identity Services Trust Framework Bill and Security Information in Proceedings Legislation Bill.

• Drafted media articles including technical aspects of the COVID-19 vaccination passport, and the increasing prevalence of virtual sexual assault of female avatars in online communities, raising an interesting cross-over between criminal, commercial, privacy and potentially defamation law. The Committee also discussed the landmark case Director of Human Rights Proceedings vs Netsafe Inc [2022] NZHRRT 15 and its implications for people who have experienced prolonged sexual harassment and Netsafe as the main regulator.

TRUST LAW COMMITTEE • The Committee continued to stay engaged with the IRD and kept a watching brief on succession law reform and the new reporting requirements for trusts proposed by IRD. Because of its submission on the reporting requirements, the IRD has now recognised the expertise of this Committee and extended an invitation to the Committee to make a submission on Foreign Trust Remedials. The Committee also provided expert feedback to the IRD on issues arising from the latest changes to the bright-line test and rollover relief.

• At the invitation of the Legal Research Foundation, some members presented at a Masterclass series on Trust Law.

Connecting with the Profession As we eased our way into calendar year 2022, the editorial team at LawNews looked forward to a period of relative calm and consolidation. With a major rethink and redesign of LawNews in June 2021, followed by the covid-induced disruption that saw LawNews become a digital-only publication at the start of the first lockdown in March 2020, we thought we could do with a more leisurely start to 2022.

How wrong we were! Consolidation – maybe – but when it came to legal news, the 2022 year proved to be anything but calm, with a raft of controversial decisions and initiatives affecting the profession.

Most significant and fundamental to the future of practitioners was the so-called once-in-a-generation review of the legal profession by an independent panel which, at the time of writing, had yet to reveal its recommendations.

Towards the end of the year, the long-awaited report on access to civil justice was released. Three years in gestation, the report proposes sweeping changes to the way cases are dealt with in the District Court’s civil jurisdiction.

This was also the year when a series of flash-points made it crystal clear that politics and the law are inextricably linked. Fundamental constitutional issues, such as co-governance, freedom of speech, fair trial rights and the human rights issues around vaccine mandates were hotly debated by readers within the pages of LawNews. As always, our editorial policy was to offer readers a free marketplace of thought, with the only criteria being that opinion pieces are well-argued, well-written, non-abusive and don’t breach the law. We welcome a wide variety of views, particularly on controversial issues.

Other highlights of the year were the James Gardner-Hopkins penalty decision and appeal for sexual misconduct, the posthumous quashing of sexual abuse convictions against the late Peter Ellis and calls to regulate AI-generated legal advice.

The NZLS discussion paper wasn’t the only consultation document put before the profession this year. LawNews also wrote extensively about issues raised in the inaugural annual report released

by Chief Justice Dame Helen Winkelmann and her call to fully digitise the country’s courts, partly as a means of improving access to justice. And we followed up when the digital plan was announced with an interview with Justice David Goddard, who is managing the project, and comments from members of our Technology and Law committee who had identified potential fishhooks in the plan.

We also covered the serving of legal documents on crypto crooks via the blockchain, the vexed issue of fair pay agreements, new ways of pricing legal services beyond the billable hour, tax traps for those wanting to move property out of trusts, how the Commerce Commission tripped at the finish line when investigating New Zealand’s grocery duopoly and gaping holes in the government’s yet-to-befinalised income insurance scheme.

Once again, we would like to extend a heartfelt thanks to all our writers, colleagues, advertisers, and readers for another stellar year. Moves are afoot to significantly expand the footprint of LawNews and its sister publication, The Bulletin, in the coming months.

We can’t wait to tell you all about it!

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Continuing Professional Development Like many organisations, we were able to successfully pivot to enable our CPD programmes to operate efficiently, whilst still promoting excellence in the delivery of our learning events.

This is reflected in the move to an increase in our live-streamed events and hybrid conferencing.

Via our learning events, we taught and upskilled legal professionals and engaged with with a range of volunteer presenters. It’s an impressive effort.

Our Cradle to Grave™ conference remains our flagship conference. Unfortunately, we were unable to hold the conference live in Christchurch, but the Auckland conference was live-streamed throughout the country, to great success. Attendees were also able to join us at our other conferences namely the Youth Advocates, Property, and Unit Titles conferences.

Brian Carter at the Cradle to Grave™ conference

We aim to strike a balance between areas of practice, age and stage, black- letter law, legal skills, and developmental skills. Providing coverage on the most popular areas of practice, namely, property, commercial, trusts and wills, family, employment, and criminal law is important, but attention is also given to other practice areas.

This ensures a chance for the whole profession to learn and upskill.

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Council

Marie Dyhrberg KC

Marie Dyhrberg KC is a senior barrister specialising in criminal law and appears regularly at the District Court, High Court and Court of Appeal in New Zealand. She also appears with clients before the Parole Board. Her experience and expertise were recognised in her appointment as Queen’s Counsel in 2014.

Tony Herring

Tony joined the Wellington office of Gibson Sheat as a partner in March 2021, after 24 years with Mortlock McCormack Law in Christchurch. He practises in the areas of commercial and property law, with an emphasis on Crown property work, commercial leasing and employment law.

Tony was appointed as a Notary Public in 2009.

Craig Fisher

Craig is a consultant to the RSM New Zealand group and RSM Hayes Audit with over 28 years of public accountancy experience. He provides external audit, assurance, and risk management and governance advice across a diverse range of sectors. Craig has a significant interest and recognised expertise in not-for-profit and charitable organisations.

Andrew Skinner

Andrew is a partner at Martelli McKegg with over 20 years of experience working in private practice and in-house, practicing commercial law with particular specialties in building supplies, healthcare and franchising.

Andrew is Vice-Chair of the Frame and Truss Manufacturers’ Association and is also a qualified Chartered Secretary and a trustee of Health Navigator.

Chris is a barrister, with over 25 years of experience specialising in employment law. He was admitted in 1990 and is a longstanding member of ADLS.

Chris Eggleston

Julie-Anne was called to the Bar of England and Wales in 1991 and specialises in criminal law. She came to New Zealand in 2006 and initially worked for Meredith Connell, before joining the independent Bar in 2013.

Julie-Anne was appointed Queen’s Counsel in 2019.

Julie-Anne Kincade KC

Ellen is an associate at Simpson Western specialising in relationship property and family law. Ellen serves on ADLS’ Family Law Committee.

Ellen Snedden

Michael is an experienced cybersecurity consultant and professional director, having held a variety of governance and security leadership roles in large organisations. He is currently an independent consultant working with boards and management to address cybersecurity risk.

Michael Wallmannsberger

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Judicial and King’s Counsel Appointments We acknowledge and congratulate ADLS members who were appointed to the bench or as King’s Counsel during the year.

Judicial Appointments Justice Peter Andrew Appointed to the High Court as a Judge - based in Auckland His Honour commenced his law career in 1984 joining the Auckland Crown office, Meredith Connell & Co. In 1990 Justice Andrew joined the Auckland Law office of Russell McVeagh as a senior solicitor, practising in the employment law and commercial litigation fields. Following that from 1993-1999 he was a Crown Counsel in the Treaty Issues and International Law Team at Crown Law where he represented the Crown in public litigation in the courts at all levels, and he was a member of the Crown negotiating team for the Treaty of Waitangi settlements, appearing frequently in the Waitangi Tribunal on historical and contemporary Treaty claims.

Associate Justice Grant Brittain KC Appointed to the High Court as an Associate Judge - based in Auckland His Honour began his career in law in 1991 when he took up a role as a litigation staff solicitor with Gibson Sheat working in criminal defence, family law and civil litigation. In 1995 he relocated to London where he worked from Freshfields before returning to New Zealand in 1996, taking up a role as a litigation staff solicitor for Hesketh Henry working in commercial and general civil litigation. Following that, from 20002002 Associate Judge Brittain held positions as an Associate at Sharp Tudhope and Senior Solicitor at Holland Beckett.

Appointment of King’s Counsel 2022 Catherine Stafford Cull KC Appointed to the rank of King’s Counsel - based in Northland Catherine Cull KC is a Barrister based in Kaikohe, Northland who originally began her law career in Christchurch. She has worked at Crown Solicitor firms Meredith Connell and Raymond Donnelly & Co, was appointed to the Christchurch Crown Prosecuting Panel and Christchurch Complaints Referral Panel in 1992 and was an investigating officer of South Island prisons in the Ombudsman’s Office. For the last two decades Catherine has resided in Northland, where she first joined Law North Partners in Kerikeri as a senior solicitor before she then made the decision to return to the independent bar.

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Simon Robert Mitchell KC Appointed to the rank of King’s Counsel - based in Auckland Simon Robert Mitchell KC is a Barrister located in Auckland. He specializes in family, employment law including personal grievances, bargaining disputes, health and safety and related litigation.

Simon has worked as a litigation lawyer since 1990.

He regularly appears in the Family Court and all of the employment institutions including mediation services, Employment Relations Authority, the Employment Court and Court of Appeal. Simon has worked in the areas of domestic violence, care of children and property disputes for approximately 20 years in the Family Court.

Lisa Charlotte Preston KC Appointed to the rank of King’s Counsel - based in Christchurch Lisa Charlotte Preston KC is a Barrister based in Christchurch who graduated University with a LLB (Hons), BA and was later admitted to the bar in Wellington, 1992. Lisa is a trial and appellate lawyer who joined the independent bar in 2014 following her 20 years’ practice in New Zealand and the United Kingdom, including as a senior Crown counsel. Her practice also includes medico-legal, professional indemnity and disciplinary litigation, WorkSafe and other regulatory investigations and prosecutions.

David John Cooper KC Appointed to the rank of King’s Counsel - based in Auckland David John Cooper KC is a Barrister located in Auckland who is an experienced trial appellate advocate who appears in the courts at all levels.

David has a general civil litigation practice with a particular focus on complex contractual disputes, company and securities law, takeovers, competition law, regulatory investigations, and construction and insurance disputes.

He joined Shortland Chambers as a Barrister in 2017. David is a co-author of Corporate Law in New Zealand and is a Convenor of a Law Society Standards Committee.

Andrew Stephen Butler KC Appointed to the rank of King’s Counsel - based in Wellington Andrew Stephen Butler KC is a litigator who practises in the Wellington region. He is a general litigator, and an acknowledged expert in commercial, trusts and public law. Andrew has frequently appeared before the New Zealand Supreme Court and Court of Appeal. He is a member of many professional associations such as, Society of Trusts and Estates Practitioners (STEP), Chair of the New Zealand Law Foundation and member of the New Zealand Law Society Human Rights and Privacy Committee.

19

Stephanie Margaret Grieve KC Appointed to the rank of King’s Counsel - based in Christchurch Stephanie Margaret Grieve KC began her law career for Russell McVeagh after graduating from Otago university in 1997. Stephanie was elected to the bar in 1997. She also has experience working overseas including a French law firm, legal compliance team for an investment bank in London and as a legal counsel for a company in Amsterdam.

In 2022, Grieve returned to New Zealand, where she was located in Dunedin employed by Anderson Lloyd. She was made a partner in 2005 and then relocated to Christchurch. In 2011, she joined Duncan Cotterill as a partner before moving to the independent Bar in 2018 after her 13 years as a litigation partner.

Tiffany Mary Cooper KC Appointed to the rank of King’s Counsel - based in Auckland Tiffany Mary Cooper KC is a litigator who is located in Auckland and has been a litigator for nearly 20 years. Tiffany is a member of ADLS, the New Zealand Bar Association, Auckland Crown Solicitor’s prosecution panel, Pro Bono SPCA Panel Prosecutor and South Auckland (Manukau) Crown Solicitor’s Prosecution Panel.

Nicholas Paul Chisnall KC Appointed to the rank of King’s Counsel - based in Auckland Nicholas Paul Chisnall KC was elected to the bar in 1999, where he started as a commercial and property lawyer at Gibson Sheat before making the decision to move into employment law. He was the Public Defence Service’s General Counsel and oversaw the PDS’s appellate practice. Prior to joining the PDS, he was Crown Counsel at the Crown Law Office in Wellington, where he led appeals in the Court of Appeal and Supreme Court on behalf of the SolicitorGeneral. Chisnall then moved to the independent bar in 2017.

20 ADLS ANNUAL REPORT | 2022

Bronwyn Shirley Carruthers KC Appointed to the rank of King’s Counsel - based in Auckland Bronwyn Shirley Carruthers KC has specialised in environmental, resource management and local government law since 2000. She graduated from the University of Waikato with LLB (Hons) and BSc (Environmental Science) and was admitted to the bar in 2000. She began her law career at Simpson Grierson before joining Russell McVeagh in 2011 where she became a partner in that firm’s Environmental, Planning and Natural Resources team later that year. In December 2018 Bronwyn joined Shortland Chambers. Carruthers has advised on a wide range of Resource Management Act 1991 issues and has experience appearing at all levels of New Zealand’s justice system.

Jason Keith Goodall KC Appointed to the rank of King’s Counsel - based in Auckland Jason Keith Goodall KC is a commercial advocate based in Auckland with a high focus on High Court and appellate litigation. He graduated from the University of Auckland with LLB (Hons)/BCom. Jason commenced his practice as a barrister in 2009; prior to this he clerked for Sir Peter Blanchard in the Court of Appeal. Jason practises across the full range of commercial litigation, but has particular expertise in banking and finance disputes, insurance, professional negligence, insolvency, trust and company litigation, and property disputes.

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21

Financial Statements Approval of Annual Report

23

Independent Auditor’s Report

24-25

Statement of Financial Performance

26

Statement of Movements in Members’ Funds

27

Statement of Financial Position

28

Notes to the Financial Statements

22 ADLS ANNUAL REPORT | 2022

29-38

Approval of Annual Report The Council presents the Annual Report including the Financial Statements of the Auckland District Law Society Incorporated for the year ended 30 September 2022.

Marie Dyhrberg KC

Tony Herring

President

Vice President

31 January 2023

23

Independent Auditor’s Report

Grant Thornton New Zealand Audit Limited L4, Grant Thornton House 152 Fanshawe Street PO Box 1961 Auckland 1140 T +64 (0)9 308 2570 www.grantthornton.co.nz

To the Members of Auckland District Law Society Incorporated Report on the Audit of the Financial Statements Qualified Opinion We have audited the financial statements of Auckland District Law Society Incorporated (the “Entity”) on pages 26 to 38 which comprise the Statement of Financial Position as at 30 September 2022, and the Statement of Financial Performance and Statement of Movements in Members’ Funds for the year then ended, and notes to the financial statements, including a summary of significant accounting policies.

In our opinion, except for the effects of the matter described in the Basis for Qualified Opinion section of our report, the accompanying financial statements present fairly in all material respects, the financial position of the Entity as at 30 September 2022, and of its financial performance for the year then ended, in accordance with Special Purpose Financial Reporting Framework For Profit Entities (“The Framework”) issued by Chartered Accountants Australia and New Zealand.

Basis for Qualified Opinion The Entity had land and buildings of $10,779,425 which are accounted for at fair value on the Statement of Financial Position as at 30 September 2021. We were unable to obtain sufficient appropriate audit evidence about the carrying amount of the land and buildings as at 30 September 2021. The land and buildings were subsequently sold and disposed of during the year ended 30 September 2022. Consequently, we were unable to determine whether any adjustments to these amounts were necessary, when calculating the gain on disposal of $4,477,828 recognised in the Statement of Financial Performance during the year ended 30 September 2022.

We conducted our audit in accordance with International Standards on Auditing (New Zealand) (ISAs (NZ)) issued by the New Zealand Auditing and Assurance Standards Board. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Entity in accordance with Professional and Ethical Standard 1 International Code of Ethics for Assurance Practitioners (including International Independence Standards) (New Zealand) issued by the New Zealand Auditing and Assurance Standards Board, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified opinion.

Other than in our capacity as auditor we have no relationship with, or interests in, the Entity.

Emphasis of Matter We draw attention to Note 1 of the financial statements, which describes the basis of accounting. The financial statements are prepared in accordance with a Special Purpose Financial Reporting Framework and, therefore, may not be suitable for another purpose. Our report is intended solely for the Entity’s members and should not be distributed to or used by parties other than the Entity’s members. Our Opinion is not modified in respect of this matter.

Information Other than the Financial Statements and Auditor’s Report thereon The Councillors are responsible for the other information. The other information comprises the information included in the Annual Report but does not include the financial statements and our auditor’s report thereon.

Our opinion on the financial statements does not cover the other information and we do not express any form of audit opinion or assurance conclusion thereon.

Chartered Accountants and Business Advisers ADLS ANNUAL REPORT | 2022 Member24 of Grant Thornton International Ltd.

In connections with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements, or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Councillors’ Responsibilities for the Financial Statements The Councillors are responsible on behalf of the Entity for the preparation and fair presentation of these financial statements in accordance with The Framework and for such internal control as those charged with governance determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, those charged with governance are responsible on behalf of the entity for assessing the Entity’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Councillors either intend to liquidate the Entity or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (NZ) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

A further description of the auditor’s responsibilities for the audit of the financial statements is located on the External Reporting Board’s website at: https://www.xrb.govt.nz/standards-for-assurance-practitioners/auditors-responsibilities/auditreport-8/ Restriction on use of our report This report is made solely to the Entity’s members, as a body. Our audit work has been undertaken so that we might state to the Entity’s members, as a body, those matters which we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Entity and the Entity’s members, as a body, for our audit work, for this report or for the opinion we have formed.

Grant Thornton New Zealand Audit Limited

Auckland 3 February 2023

Chartered Accountants and Business Advisers Member of Grant Thornton International Ltd.

Statement of Financial Performance for the year ended 30 September 2022 in New Zealand Dollars

Note

2022

2021

$

$

Total operating revenue

2

7,532,691

7,899,419

Total operating expenses

3

(6,424,595)

(6,212,070)

1,108,096

1,687,349

Gross operating surplus

Impairment of restaurant assets

7

-

(38,000)

Gain on sale of land and buildings

7

4,477,828

-

Impairment of assets

7

(520,234)

-

5,065,690

1,649,349

(42,734)

(405,047)

5,022,956

1,244,302

Surplus for the year before taxation

Taxation

10

Net surplus for the year after taxation This statement is to be read in conjunction with the notes to the financial statements.

26 ADLS ANNUAL REPORT | 2022

Statement of Movements in Members’ Funds for the year ended 30 September 2022 in New Zealand Dollars

Note

2022

2021

$

$

Net surplus after taxation

5,022,956

1,244,302

Total recognised revenues and expenses

5,022,956

1,244,302

Members' funds at beginning of year

11

16,641,215

15,396,913

Members' funds at end of year

11

21,664,171

16,641,215

This statement is to be read in conjunction with the notes to the financial statements.

27

Statement of Financial Position as at 30 September 2022 in New Zealand Dollars Note

2022

2021

$

$

Assets Stock - legal forms & books

23,924

29,682

10

278,056

-

128,301

75,987

Debtors

4

506,860

551,431

Cash and short-term deposits

5

2,073,407

3,148,324

Term deposits

5

Taxation Prepayments & other debtors

Total current assets

1,950,000

2,850,000

4,960,548

6,655,424

Investments

6

17,560,546

-

Property, plant and equipment

7

291,109

11,466,512

Total non-current assets

17,851,655

11,466,512

Total assets

22,812,203

18,121,936

Liabilities Trade creditors

426,331

225,268

Other creditors and accruals

117,263

247,070

Employee entitlements

181,695

239,657

395,943

451,362

Income received in advance

9

Goods and services tax

26,800

41,412

-

275,952

Total current liabilities

1,148,032

1,480,721

Total liabilities

1,148,032

1,480,721

Taxation

10

Members' funds Accumulated funds

11

21,572,820

7,915,954

Asset revaluation reserve

11

91,351

7,925,261

Long-term property maintenance reserve

11

-

800,000

Total members' funds

21,664,171

16,641,215

Total members’ funds and liabilities

22,812,203

18,121,936

This statement is to be read in conjunction with the notes to the financial statements.

Marie Dyhrberg KC

Tony Herring

President

Vice President

31 January 2023

28 ADLS ANNUAL REPORT | 2022

Notes to the Financial Statements 1. Significant accounting policies

Reporting entity The Auckland District Law Society Incorporated (the Society) is a professional body representing the interests of its Members and the legal profession in New Zealand. The Society is constituted under the Incorporated Societies Act 1908 with an effective commencement date of 1 February 2009.

The activities of the Auckland District Law Society were incorporated into the Society on 1 February 2009. Under the requirements of the Lawyers and Conveyancers Act 2006 the activities of the Auckland District Law Society were required to be incorporated when the Council resolved not to join the New Zealand Law Society. All of the assets and liabilities of the Auckland District Law Society that were not transferred to the New Zealand Law Society were transferred to the Incorporated Society from 1 February 2009.

The Society is not required to prepare general purpose financial reporting under any legislation or founding constitution. Accordingly, in the absence of a special purpose framework for not-for-profit entities, the Society has voluntarily elected to adopt a Special Purpose Financial Reporting Framework for use by for-profit entities issued by Chartered Accountants Australia and New Zealand.

Measurement basis The measurement base adopted is that of historical cost, with the exception that certain fixed assets are carried at valuation. Reliance is placed on the fact that the entity is a going concern. Revenue earned is matched with expenses incurred using accrual accounting concepts.

Specific accounting polices

Furniture Equipment Library books

All items of property, plant and equipment are initially recorded at cost, including costs directly attributable to bringing the assets to their working condition. Freehold land and buildings are revalued to fair value at least every five years by an independent valuer. Library books are revalued to fair value at least every five years.

Revaluations are recognised in an asset revaluation reserve for that class of asset within general reserves. If any revaluation reserve has a deficit, that deficit is recognised in the statement of financial performance in the period it arises.

In subsequent periods any revaluation surplus that reverses previous revaluation deficits is recognised as revenue in the statement of financial performance. (b) Depreciation Depreciation is provided for on a straight-line basis on all property, plant and equipment items at rates calculated to allocate the asset’s cost or valuation less estimated residual value, over the estimated useful lives. When an asset is revalued, the depreciation charge is calculated on that revalued amount from the date of revaluation.

The principal rates are: Land 0% Buildings & alterations

3-40%

Furniture 6-21% Equipment 8-67% Software

40%

Library books

0%

(a) Property, plant & equipment The Society has five classes of fixed assets: Land Buildings & alterations

29

Notes to the Financial Statements (continued)

(c) Amortisation Amortisation is provided for on a straight-line basis over the lease inducements paid. The periods are determined by the original lease agreement term. (d) Stocks - legal forms & books Stocks - legal forms & books inventories have been valued at the lower of cost, determined on a specific identification basis, or net realisable value after due allowance for damaged and obsolete stock. (e) Debtors Debtors are stated at their cost less an allowance for any uncollectible amounts. (f) Income taxation The Society is a not-for-profit organisation and is not liable for income tax on income relating to membership activities. The Society is subject to income tax on activities outside the circle of membership. The Society accounts for taxation using the taxes payable method. Deferred tax is not accounted for. (g) Goods and services tax The financial statements have been prepared on a GST exclusive basis except for debtors and trade creditors, which are shown inclusive of GST. (h) Leases The Society leases office equipment and premises. Operating lease payments, where the lessors effectively retain substantially all the risks and benefits of ownership of the leased items, are recognised in the determination of the operating surplus in equal instalments over the lease term. (i) Revenue Membership levies are recognised over the period in which they are active. Sales of goods are recognised when they have been ordered and delivered to the customer. Sales of services are recognised on the date the service takes

30 ADLS ANNUAL REPORT | 2022

place. Interest income is recognised using the effective interest method. Rent income is recognised on a straight-line basis over the life of the lease. (j) Financial instruments Financial instruments include debtors, investments, creditors, cash balances and deposits. Financial instruments are stated in the statement of financial position when the entity becomes party to a financial contract. Debtors are stated at their cost less impairment losses.

Investments are measured at fair market value of a quoted active market. (k) Cash and equivalents Cash and cash equivalents comprise cash on hand, cash in banks and cash deposits in banks. (l) Long-term property maintenance reserve The long-term property maintenance reserve was established to allow for major items of property maintenance. It is based on a 15-year long-term maintenance report prepared by Opus in 2015. (m) Assets reviewed for impairment Assets that are subject to depreciation or amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount of an asset is defined as the fair value less cost to sell. (n) Change in accounting policies There have been no changes in the accounting policies in the current period.

Notes to the Financial Statements (continued)

for the year ended 30 September 2022 in New Zealand Dollars

2. Operating revenue

2022

2021

$

$

Membership levies

989,884

894,891

Interest income

171,041

57,773

Dividend income

6,457

2,362

Investment loss

(45,615)

-

Rent income

173,559

455,481

Other service revenue

6,237,365

6,488,912

Total operating revenue

7,532,691

7,899,419

Operating revenue comprises:

Other service revenue includes commercial and non-commercial activity including continuing professional development, legal forms and digital signing, NZ Lawyers’ Directory sales, book sales, collegial events, sponsorships, property operating expense recovery (Opex), LawNews subscriptions, will enquiries and advertising. Rent income discontinued from 29 July 2022 on the sale of Chancery Chambers.

3. Operating expenses

2022

2021

$

$

Operating expenses include: Audit fees

21,000

21,000

Bad and doubtful debts (recovery) expense

(360)

(17,872)

Buildings & alterations

29,728

82,806

Furniture

13,977

13,983

Equipment

354,951

379,518

Total depreciation

398,656

476,307

Amortisation on lease inducements

-

19,792

Donations & community services

7,966

3,500

Equipment rental (lease expense)

3,615

3,400

Depreciation

Interest paid Salaries & wages

4. Debtors

-

-

2,569,112

2,297,456

2022

2021

$

$

529,058

575,762

Debtors: Debtors Less: Allowance for doubtful debts

(22, 198)

(24,331)

506,860

551,431

31

Notes to the Financial Statements (continued)

for the year ended 30 September 2022 in New Zealand Dollars

5. Cash and deposits Bank accounts and deposits are held with major New Zealand trading banks with Standard & Poor’s credit ratings of AAand have maturities under 6 months. Term deposits have maturities over 6 months.

A specific security charge is held over a $100,000 bank deposit to secure the unutilised bank overdraft facility.

6. Investments Operational fund 2022 Opening balances

New building fund 2022

Total investment funds 2022

-

-

-

Deposits made during the year

2,250,000

15,296,777

17,546,777

Interest received, net of taxes

5,732

50,774

56,506

Dividends received

2,878

-

2,878

Foreign exchange gain

1

-

1

Valuation adjustment

(30,070)

(15,546)

(45,616)

2,228,541

15,332,005

17,560,546

The sale proceeds after commission and marketing expense from the sale of Chancery Chambers has been invested into the New Building Fund. The New Building Fund is a conservative fund for the purchase of a new building. The Operational Fund has a balanced growth risk profile. Investments are independently managed by Forsyth Barr.

7. Property, plant and equipment 2022 Cost or Valuation

Accumulated Depreciation / Impairment

Carrying value

$

$

$

75,612

35,537

40,075

156,111

77,311

78,800

At valuation Library books At cost Furniture Equipment

32 ADLS ANNUAL REPORT | 2022

2,173,585

2,001,351

172,234

2,405,308

2,114,199

291,109

Notes to the Financial Statements (continued)

for the year ended 30 September 2022 in New Zealand Dollars

7. Property, plant and equipment (continued) 2021 Cost or Valuation

Accumulated Depreciation / Impairment

Carrying value

$

$

$

At valuation Land

5,490,000

-

5,490,000

Buildings

6,167,889

878,464

5,289,425

Library books

75,612

35,537

40,075

156,111

63,334

92,777

At cost Furniture Equipment

2,210,023

1,655,788

554,235

14,099,635

2,633,123

11,466,512

Chancery Chambers was sold and settled on 29 July 2022 for $15,500,000 with a gain on sale of $4,477,828. Chancery Chambers is a Schedule B Heritage Building which imposes certain obligations under the Auckland Council Plan.

The Chancery Chambers building and land were valued for accounting purposes on 22 September 2015 by TL Esplin at Telfer Young (Auckland) Limited, an independent registered valuer, at $10,500,000. At 30 September 2022 an impairment was assessed to the digital signing system software under development and recorded at $520,234. At 30 September 2021 an impairment to the value of the fit-out assets of the restaurant has been assessed and recorded at $38,000.

8. Lease inducements 2022

Lease inducements

Cost

Amortisation

Carrying value

$

$

$

-

-

-

Cost

Amortisation

Carrying value

$

$

$

95,000

95,000

-

2021

Lease inducements

Lease inducements are recorded at contribution cost less amortisation spread over the period of the tenant’s lease.

33

Notes to the Financial Statements (continued)

for the year ended 30 September 2022 in New Zealand Dollars

9. Income received in advance

2022

2021

$

$

For future Membership fees

355,599

306,294

For future CPD events

31,401

132,790

For future collegial events

8,504

6,291

For future bookshop purchases

439

5,987

395,943

451,362

The Society receives monies in advance of an event or product being available. This is recorded as a liability until performance of that event has taken place or delivery of that product has been completed.

10. Taxation

2022

2021

$

$

Income taxation due on net non-membership income

42,734

405,047

Provisional tax payments made during the year

(271,374)

(111,726)

RWT paid during the year

(49,416)

(17,369)

Total taxation payable (receivable)

(278,056)

275,952

The Society’s 2022 non-taxable membership income represented 13.1% (2021: 11.3%) of total operating revenue.

A calculation using this percentage determines non-deductible expenditure. Total net taxable income in 2022 was $153,920 (2021: $1,447,504). The gain on sale of Chancery chambers is not considered assessable income.

34 ADLS ANNUAL REPORT | 2022

Notes to the Financial Statements (continued)

for the year ended 30 September 2022 in New Zealand Dollars

11. Movements in Members’ funds

2022

Accumulated Funds

Asset Revaluation Reserve

Long–Term Property Maintenance Reserve

Total

$

$

$

$

Opening balance

7,915,954

7,925,261

800,000

16,641,215

Recognised surplus

5,022,956

-

-

5,022,956

Release of reserve - sale of property

800,000

-

(800,000)

-

Release of reserve - sale of land

5,579,481

(5,579,481)

-

-

Release of reserve - sale of buildings

2,254,429

(2,254,429)

-

-

Balance at end of year

21,572,820

91,351

-

21,664,171

2021 Accumulated Funds

Asset Revaluation Reserve

Long–Term Property Maintenance Reserve

Total

$

$

$

$

Opening balance

6,771,652

7,925,261

700,000

15,396,913

Recognised surplus

1,244,302

-

-

1,244,302

Transfer between reserves

(100,000)

-

100,000

-

Balance at end of year

7,915,954

7,925,261

800,000

16,641,215

12. Commitments Expenditure commitments: the Society had $481,339 of commitments at 30 September 2022 for new system development, books ordered, LexisNexis reference resources and system licence fees (2021: $78,143).

Operating lease expense commitments under non-cancellable operating leases: 2022

2021

$

$

Not later than one year

305,980

-

One to two years

253,283

-

-

-

559,263

-

Two to five years Total operating lease commitments

Operating lease expense commitments are for premises.

Landlord operating lease payments receivable under non-cancellable operating leases: 2022

2021

$

$

Not later than one year

-

147,755

Later than one year

-

62,160

Total landlord operating lease payments receivable

-

209,915

35

Notes to the Financial Statements (continued)

for the year ended 30 September 2022 in New Zealand Dollars

13. Financial instruments Credit risk The Society is party to the following financial instruments: Cash, Deposits, Debtors, Investments, Creditors and Accruals.

The financial instruments which potentially subject the Society to credit risk principally consist of Cash, Deposits and Debtors. The maximum exposure to credit risk is: 2022 Cash and deposits

2021

$

$

4,023,407

5,998,324

Debtors

506,860

551,431

Total credit risk exposure

4,530,267

6,549,755

Concentrations of credit risk The Society is not exposed to any concentrations of credit risk, as the cash and deposits are made with a number of registered banks.

Credit facilities The Society has a total bank overdraft facility of $100,000 (2021: $100,000). Of this, none has been utilised by the Society at balance date.

Interest rate risk The Society is exposed to interest rate risk in that future interest rate movements will affect the returns earned and the cash flows on short-term bank deposits and the interest paid on bank debts.

Fair value of financial instruments Assets and Liabilities recorded at fair value are valued according to the fair value hierarchy as follows: Level 1 Quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2 Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices).

Level 3 Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs).

There have been no transfers of assets between levels during the financial year.

Financial Instrument Classification The carrying amounts of financial instruments by category are listed below. For those held at fair value the applicable level in the fair value hierarchy is shown.

The carrying amounts of financial instuments by category are:

2022

2021

$

$

Amortised Cost Cash and cash deposits* Debtors

19,712,791 506,860

5,998,324 551,431

Fair value through profit or loss Investment equity shares - level 1 fair value hierarchy Investment fixed shares - level 1 fair value hierarchy

409,123 1,462,039

-

Fair value through other comphrehensive income

-

-

426,331 117,263

225,268 247,070

Liabilities at amortised cost Creditors Accruals * Cash & cash deposits include $15,689,384 which is held by Forsyth Barr for the purpose of investing.

36 ADLS ANNUAL REPORT | 2022

Notes to the Financial Statements (continued)

for the year ended 30 September 2022 in New Zealand Dollars

14. Related parties There are transactions between the Society and its Members in the normal course of business. The following persons were members of the Council as at 30 September 2021: Marie Dyhrberg KC, Tony Herring, Chris Eggleston, Craig Fisher, Julie-Anne Kincade KC, Andrew Skinner, Ellen Snedden, Michael Wallmannsberger.

2022

2021

$

$

President's honorarium

51,600

51,600

Non-lawyer Council members' remuneration

30,000

30,000

President's expenses

6,145

1,436

Council members' expenses

670

4,912

Council members’ expenses are primarily for non-Auckland members’ travel and accomodation whilst engaged on Council business.

15. Contingent liability There are no known contingent liabilities. (2021: In October 2019, a detailed seismic analysis of Chancery Chambers, undertaken at Auckland District Law Society Incorporated Council’s instigation, classified it as an earthquake-prone building under the Building Act 2004. As per the Building Act 2004, Auckland is classified as a low-risk zone and as such all required seismic restraint work should be completed within 35 years of receiving an earthquake-prone notice from Auckland Council. The full extent of costs required to complete the seismic strengthening within the next 35 years are not yet known to Auckland District Law Society Incorporated but are believed to be significant.)

16. Events after balance date There were no events occurring after balance date that impact on these financial statements. (2021: Members were notified on 29 October 2021 that a postal ballot at the direction of Council will be held in accordance with Rule 25 of the Society’s rules. The resolution was “The Council may take all necessary steps to sell Chancery Chambers on terms it considers to be in the best interests of the Society”. The Ballot closed on 19 November 2021 and after counting, was declared as passed.)

37

Notes to the Financial Statements (continued)

for the year ended 30 September 2022 in New Zealand Dollars

17. Funds administered by the Society These funds are administered by and do not belong to the Society and as such have not been recognised in these financial statements.

Members’ Special Fund The Members’ Special Fund is held by a separate trust and is not available for the Society’s general operating purposes.

Its use is restricted to specified purposes and the funds are controlled by a committee separate to the Council of the Society.

2022

2021

$

$

Balance at beginning of period

353,589

361,516

Interest received, net of RWT

711

128

Grants extended

-

(9,437)

Recovery

650

650

Changes to provision for bad debts

-

800

Expenses

(41)

(68)

354,909

353,589

2022

2021

Balance at end of year

Members' Special Fund bank account Net loans to members after provision for doubtful debts Balance at end of year

38 ADLS ANNUAL REPORT | 2022

$

$

354,909

353,589

-

-

354,909

353,589

Chancery Chambers 2 Chancery Street, Auckland Central Auckland 1010 PO Box 58 Shortland Street, Auckland 1140 DX CP24001 Phone: 09 303 5270, Fax: 09 309 3726 Email: reception@adls.org.nz www.adls.org.nz