Decisions filed recently with the Law Society (which may be subject to appeal)
Hearing 20-21 August 2019
Reasons 4 October 2019
The Solicitors Disciplinary Tribunal ordered that the respondent should be struck off the roll.
The respondent had, while the sole director and owner of ALD Legal Limited, of First Floor, 2 Peterborough Road, Harrow, Middlesex, HA I 2BQ:
(i) misappropriated client money by using funds held for client AB to make 13 improper payments totalling £226,972.52 which had no connection to AB, in breach of rules 1.2(c) and 20.l of the SRA Accounts Rules 2011, and principles 2, 4, 5, 6 and 10 of the SRA Principles 2011, and had acted dishonestly.
(ii) caused or permitted a minimum client account cash shortage in the sum of £177,235.19 to exist as at 15 June 2016, in breach of rules 1.2(c), 20.1 and 20.6 of the rules, and principles 2, 4, 5, 6 and 10, and had acted dishonestly.
(iii) failed to act in the best interests of AB in the purchase of 19 Larkfield Avenue by failing to inform AB of the true nature of the sale of 19 Larkfield Avenue, in breach of principles 2, 4, 5 and 6, and had acted dishonestly.
(iv) breached principles 2, 3, 4, 5 and 6, and failed to achieve outcomes 3.4 and 3.5 of the SRA Code of Conduct 2011 by acting in circumstances where there was a conflict of interest and/or a significant risk of a conflict of interest, and failed to advise AB to seek independent legal advice, and had acted dishonestly.
(v) failed to provide AB with a proper standard of service in relation to the purchase of 19 Larkfield Avenue and provided him with misleading information as to the status of his matter, thereby breaching principles 2, 4, 5 and 6, and failing to achieve outcomes 1.2, 1.5 and 1.12 of the code, and had acted dishonestly.
(vi) on the matter of AB, failed to have sufficient regard for his duties under regulations 9.2, 14.1 and 14.2 of the Money Laundering Regulations 2007 and/or the SRA’s warning notices on money laundering and terrorist financing, thereby breaching principles 2, 6 and 8, and failing to achieve outcome 7.5 of the code.
(vii) permitted the firm’s client bank account to be used as a banking facility in circumstances in which there was no underlying legal transaction to explain that activity on the client account, in breach of rule 14.5 of the rules, and principles 2 and 6.
The respondent’s motivation for his dishonest conduct was personal financial gain. It was planned, premeditated and concealed over a protracted period of time.
There were no mitigating features to the case and no exceptional circumstances had been advanced.
The respondent was ordered to pay costs of £27,412.
Simon Solomon Pinner and Daniel Edward Morris
Hearing 10-12 September 2019
Reasons 25 October 2019
The SDT ordered that the first respondent (admitted 1981) should pay a fine of £30,000; and that the second respondent (admitted 1977) should pay a fine of £25,000.
While in practice as partners at FairPlane UK Limited, each of the respondents had failed to ensure that it was disclosed to clients of the firm to whom the firm had recommended after-the-event legal expenses insurance brokered by Box Legal Limited, that he had an ownership interest in Box Legal, thereby breaching principles 2, 3, 4, 5 and 6 of the SRA Principles 2011, and failing to achieve outcomes 1.12, 6.1 and 6.2 of the SRA Code of Conduct 2011. [Box Legal was owned entirely by the respondents, each of them holding a 50% share.]
They had each failed to ensure that it was adequately disclosed to clients of the firm to whom the firm had recommended ATE insurance provided by Leeward Insurance Company Limited that he had a financial interest in Leeward, thereby breaching principles 2, 3, 4, 5 and 6 and failing to achieve outcomes 1.12, 6.1 and 6.2 of the code. [The respondents both had a financial interest in Leeward.]
They had failed to take reasonable, or any, steps to ensure that clients did not have relevant existing insurance before ATE insurance provided by Leeward was recommended to clients, thereby breaching principles 4, 5 and 6, and failing to achieve outcome 6.1 of the code.
They had failed to ensure that adequate client account reconciliation statements were produced, in breach of rules 29.1 and 29.2 of the SRA Accounts Rules 2011, and principles 6, 8 and 10.
They had failed to prevent transfers from the firm’s client account which were in excess of the amount held on behalf of the clients concerned, causing a minimum shortfall of £20,717.49 at 28 February 2018, in breach of rule 20.6 of the rules, and principles 6, 8 and 10.
They had failed promptly to return compensation payments to clients totalling £4,623.39, in breach of rule 14.3 of the rules and principles 5, 6, 8 and 10.
Fines were considered the appropriate sanction. The misconduct was highly unlikely to be repeated.
The first respondent was the compliance officer for legal practice and compliance officer for finance and administration of the firm, and by far the more experienced. He had made the decisions about the extent of disclosure and drafted key documents.
The second respondent was less experienced, but he did not know the extent of the disclosure of his conflict of interest because he did not ask. He had decided he could leave all those decisions to the first respondent, while he addressed himself to the firm’s systems, because he trusted the first respondent as a good lawyer and competent to make such decisions.
The respondents were ordered to pay costs of £25,000, on the basis of joint and several liability.
Michael William Freeman
Hearing 4-5 September 2019
Reasons 1 October 2019
The SDT ordered that the respondent should be struck off the roll.
While an employee of Proskauer Rose (UK) LLP, the respondent had failed to inform the firm that he had not attended the seminars or the examination session for the Certificate of Proficiency in Insolvency (CPI) and that he had not attended the CPI examination on 1 December 2016 for which the firm had paid for tuition, examination and professional student membership fees, in breach of principles 2 and 6 of the SRA Principles 2011. He had acted dishonestly.
On numerous occasions, the respondent had represented to senior colleagues at the firm that he had attended the CPI course and had both entered for and passed the CPI examination for which the firm had paid for tuition, examination and professional student membership fees, in breach of principles 2 and 6. He had acted dishonestly.
The respondent had produced a professional biography for external and internal marketing purposes, knowing that it contained false and/or misleading information about his skills and experience and that, if published, the biography would mislead the public as to his skills and expertise, thereby breaching principles 2 and 6, and failing to achieve outcome 8.1 of the SRA Code of Conduct 2011. He had acted dishonestly.
The respondent’s conduct had been motivated by his desire to retain his job and maintain the favourable view of his colleagues and bosses. His initial dishonest conduct had been spontaneous. However, he had done nothing thereafter to correct that misrepresentation. He had only been truthful about his situation when he had no option.
The firm had lost out financially in the payment for the course. Further, it had been giving the respondent work based on its belief that he was competent to undertake such work.
The protection of the public and the reputation of the profession required that the respondent be struck off the roll, and there were no exceptional circumstances justifying a lesser sanction.
The respondent was ordered to pay costs of £9,423.