National firm Slater and Gordon has been fined £81,588 for multiple breaches of regulations that occurred under its former owners.

Solicitors Regulation Authority investigators found evidence of issues with client care and the handling of cases happening while the financial position of the firm worsened after 2015.

The business, which had grown rapidly under Australian owners, was acquired in 2018 and the new management identified and self-reported a number of matters.

Several cases of misconduct involving different fee earners subsequently emerged. They included:

  • 18 cases where matters were inadequately supervised and not progressed for a ‘significant’ time
  • 20 cases where court proceedings were discontinued without clients’ instructions or knowledge
  • 21 cases where court directions were not complied with leading to some cases being struck out
  • Cases where clients were not informed about the progress of their matters
  • A total of 660 matters between November 2017 and February 2018 that had no after-the-event insurance at the outset, despite clients being  informed that cover was in place.

The SRA said that the cases affected represented less than 0.18% of all cases dealt with by the firm during the period. Some, but not all, were handled by fee earners who were later ordered to leave the profession.

Gareth Evans was struck off by the Solicitors Disciplinary Tribunal in October 2021 after admitting dishonesty by not telling a client that her claim had settled for £45,000 without her instruction. The SRA also confirmed that former paralegal Angela Drinkwater, who was barred from the profession after settling a client’s PI claim without their knowledge, was subsequently convicted of fraud.

The misconduct occurred at a time when Slater and Gordon’s former owners were battling to turn around a firm that had been on an acquisition spree since buying Russell Jones & Walker in 2012 and being granted an ABS licence by the SRA. Firms bought over the next three years included Marrons, Goodmans, Fentons, J. Pickering & Partners, Pannone, Walker Smith Way and Leo Abse Cohen. The biggest acquisition, for a deal worth £637m, was for the listed claims business Quindell and resulted in Slater and Gordon being split into two businesses.

Financial struggles then began. Slater and Gordon UK Holdings Ltd later acquired the UK operations of the group and separated it from the Australian parent company, buying the right to keep the brand in the UK and to use it in Europe.

The SRA said it accepted that since the acquisition the firm has made an ‘extensive’ number self-reports and taken ‘substantial’ steps to improve its compliance and risk management procedures. This work started even before the majority of the regulator's investigations began.

Nonetheless, the firm accepted that given the continuity in its ABS licence then it was appropriate for the SRA to impose a fine. 

The SRA said the number of breaches was 'proportionately small' compared to the one million or so clients of the firm during the revelant period. There was no evidence of any significant harm to clients or third parties, there was a low risk of repetition and the firm assisted the investigation throughout, self-reporting and admitting breaches and making changes to systems, policies and procedures in advance of any sanction. A maximum allowable 40% discount in the potential fine was applied to reflect the mitigating factors, reducing the sanctions from around £136,000 to £81,566. The firm will also pay costs of £16,350.

 

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