A solicitor who oversaw a property sale between a couple at a significant undervalue has been fined for acting where there could have been a conflict.
The Solicitors Disciplinary Tribunal heard that Maxine Madderson had acted on behalf of both a 78-year-old vendor and her 34-year-old boyfriend, who was purchasing the property. It was sold almost 10 years ago for £70,000, having been sold in 2006 for £238,500.
Madderson, who had founded Hertfordshire firm Maddersons Solicitors, admitted acting where there was a conflict or significant risk of a conflict by representing both vendor and purchaser in the sale. She also admitted failing to take adequate steps to ensure either client received independent advice.
The matter was raised with the SRA by the vendor’s daughter in 2018, after her mother had died. Madderson had written to the daughter in 2014 in response to an allegation of undue influence on the vendor during the sale. The solicitor stated she had ‘personally attended’ the vendor and was satisfied she had full capacity to make the decision to transfer the property.
In 2019, summary judgment was given by Master Price in the High Court in favour of the daughter, where he set aside the transaction on the basis of undue influence. Master Price said Madderson’s letter from five years previously ‘cannot be regarded as anything other than self-serving’.
It was submitted to the tribunal that the vendor had stated repeatedly that she was in a relationship with the purchaser for some years and that they loved each other. This was confirmed in a letter to the firm, in which the vendor also confirmed the pair would be living together at the property.
The tribunal found no evidence of dishonesty or malicious intent from Madderson, and accepted that she attempted, albeit ineffectively, to mitigate the risk inherent in the property sale.
But she had been found by the High Court to have made no effort to ascertain the mental capacity of a client described as an elderly lady, overseeing a purchase at a ‘substantial undervalue’ in circumstances where she acted for both parties.
In agreement with the SRA, she was fined £8,000 and ordered to pay £4,000 costs.