SDT: Solicitor acted reasonably at first but not thereafter
A solicitor discarded an undertaking he had given and tried to take advantage of a mistake made by the law firm on the other side of a conveyancing transaction, it has emerged.
Waheed Rahman has been suspended for six months, a sanction suspended for two years, with conditions placed on his practising certificate that ban him from being a manager or employee of a law firm without the Solicitors Regulation Authority’s (SRA) permission.
He can apply to have the conditions relaxed after three years, the Solicitors Disciplinary Tribunal (SDT) ruled.
Mr Rahman, born in 1977 and admitted in 2009, was a sole practitioner at Swindon firm Legal Companion. He acted for a ‘Ms K’ in buying out the equity of the co-owner of her home and in a re-mortgage. ECL, a firm regulated by the Council of Licenced Conveyancers, acted for the building society.
The solicitor provided ECL with an undertaking “to take all reasonable steps necessary to assist you in procuring registration of your client’s mortgage as a first legal charge and to immediately assist with and satisfy any requisitions carried about by HM Land Registry”.
The matter completed in April 2018 and the mortgage funds were forwarded by ECL on 12 April. The firm discharged the previous mortgage and a few days later ECL said it had carried out an OS1 priority search in respect of the property and was preparing the documents for registration.
However, ECL said that “due to a system issue the application was not submitted”, and it did not renew the OS1 priority search when it expired.
When Mr Rahman realised what had happened, he submitted his own priority search against the property in favour of his client Ms K. He then notified ECL of its error and sent ECL an invoice for £4,459 in respect of legal fees, requesting payment, or an undertaking that payment would be made, before he would remove the priority search. He sought to resile from his undertaking, pointing to a dispute over the date of completion.
ECL complained to the SRA, which argued before the tribunal that Mr Rahman was in breach of the undertaking.
The SDT accepted that it may have been appropriate to seek to recover from ECL the fees reasonably flowing from work caused by its error, but said the level of fees was “unjustifiable”.
“No meaningful explanation of how the fees were incurred was provided,” it said. “The level of fees was out of all proportion to the complexity of the issues and tasks involved.”
The tribunal deprecated Mr Rahman’s threat to not correspond with ECL further unless he received confirmation of his costs being paid, and his attempt to resile unilaterally from the undertaking – he was “professionally obliged” to comply with it.
The tribunal accepted that Mr Rahman was “deeply frustrated that errors he had anticipated, and warned about, had come to pass” and had “lost all confidence” in ECL. But whilst protecting his client with a new search was reasonable, using it to prevent ECL from registering their client’s legal charge was not.
This behaviour showed a lack of integrity and breached other SRA principles, it decided, as did trying to take unfair advantage of a third party.
Noting also that the invoice on its face was payable by Ms K – his quoted fee for the work was £190 – the SDT found Mr Rahman had not obtained her consent to raise it. In doing so, he failed to act in his client’s best interests.
It acknowledged that Mr Rahman had complied with the SRA’s instruction to remove the priority search. Further, “the misconduct arose out of one incident and the tribunal accepted that some additional work had been caused by mistakes made by others”.
But Mr Rahman had shown “little genuine regret and insight about his misconduct”, beginning his submissions by stating that he did not know what he had done wrong.
The suspended suspension “would provide adequate protection against the risk of harm to clients, the public and would maintain the reputation of the profession”, the SDT concluded. “Public confidence demanded no lesser sanction.”
Further, the practising restrictions prevented the solicitor from having roles “where there was a risk of similar issues arising” – meaning those where he had sole responsibility for compliance issues and professional ethics.
Mr Rahman was also ordered to pay £15,000 in costs.
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