Decisions filed recently with the Law Society (which may be subject to appeal)
Stylianos Petrou and Petrou Law Partnership
Hearing 23-26 September 2019
Reasons 26 November 2019
The SDT ordered the first respondent (admitted 1997) to pay a fine of £50,000. It ordered that the second respondent be reprimanded.
The first respondent, while in practice as a solicitor at and a partner in the second respondent, Petrou Law Partnership, and while acting throughout on a private basis for D in relation to a claim for catastrophic brain injuries, had used one or more interim payments of D’s damages to pay the second respondent’s profit costs and/or professional disbursements, without obtaining the court’s approval of such interim payments, or permission for such use, contrary to Part 21 of the Civil Procedure Rules, thereby breaching rules 1.02, 1.03, 1.04, 1.05 and 1.06 of the Solicitors Code of Conduct 2007, principles 2, 3, 4, 5, 6 and 10 of the SRA Principles 2011, and failing to achieve outcomes 1.1 and/or 3.4 of the SRA Code of Conduct 2011.
He had failed to provide D’s litigation friend with any or adequate information about costs, either at the outset or during the life of the retainer, thereby breaching rules 1.05 and 2.03 of the Solicitors Code of Conduct 2007 and principle 5 and failing to achieve outcome 1.13 of the 2011 code.
The second respondent, while it was carrying on business as a regulated firm of solicitors, had failed to prepare client account reconciliation for November 2017, in breach of rule 29.12 of the SRA Accounts Rules 2011 and principle 7.
It had failed to remedy breaches of the 2011 rules promptly upon discovery, in breach of rule 7 thereof and principles 7 and 10.
In relation to BK, it had failed to keep accounting records properly written up in breach of rule 29.1 of the 2011 rules and principle 7.
The first respondent’s actions were motivated by a desire to help D and to support the firm’s reputation within the community. However, his misuse of D’s interim payments had been planned and had occurred over a protracted period of time.
The level of harm caused by the first respondent was high. A financial penalty could adequately protect the public from further harm while declaring and upholding proper standards within the profession, but as the misconduct was very serious a fine of £50,000 was required.
The first respondent was ordered to pay costs of £51,555, and the second respondent £2,500.
Jayanthi Reddy Saganti
Hearing 8 November 2019
Reasons 20 December 2019
The SDT ordered that the respondent should be struck off the roll.
The respondent had misappropriated £80,000 from client account in breach of principles 2 and 6 of the SRA Principles 2011 and rule 20.1 of the SRA Accounts Rules 2011. The respondent had acted dishonestly.
She had failed to have properly written-up books of account or proper accounting systems in place in breach of rules 1.2(e), 1.2(f), 1.2(i), 6, 12.7(b), 29.2 and 29.12 of the rules.
She had failed to replace a minimum shortfall on client account of £245,100, promptly or at all, in breach of rule 7.1 of the rules and principles 6 and 10.
She had failed to run the business effectively and in accordance with proper governance and sound risk management principles by failing to establish and maintain proper accounting systems and controls over those systems, to prevent the sum of £165,100 being incorrectly paid out of client bank account, in breach of principles 6, 7, 8 and 10, and rule 8.5 of the SRA Authorisation Rules 2011.
She had failed to comply with an undertaking given to AS Solicitors in that she had failed to hold the net proceeds from a property sale to their order, thereby breaching principles 2, 6 and 7, and failing to achieve outcome 11.2 of the SRA Code of Conduct. She had acted where there was a conflict (or significant risk of a conflict) between her own interests and those of her client in borrowing monies from her client without ensuring they obtained independent legal advice, thereby breaching principles 3 and 4 and failing to achieve outcome 3.4 of the code.
The parties had applied to the SDT to approve an agreed outcome to the proceedings. The SDT was satisfied that the respondent’s admissions to all the allegations had been properly made.
The respondent’s conduct was extremely serious. She had acted dishonestly and there were no exceptional circumstances in the case. The appropriate and proportionate sanction was for her to be struck off the roll.
The respondent was ordered to pay costs of £4,000.