Solicitor who took £400,000 from estates is struck off

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SDT: “Egregious” overcharging

A solicitor who misappropriated £200,000 from the estates of clients and overcharged them by almost £200,000, has been struck off by the Solicitors Disciplinary Tribunal (SDT).

Unusually, their identity has been kept confidential for unspecified medical reasons.

The SDT said that AD, admitted in 1976, was at all times a “partner/owner manager” of his law firm, holding both compliance officer roles.

AD admitted acting dishonestly in misappropriating £200,000 from two estates, which he failed to replace promptly, and overcharging six others by almost £200,000.

“The victims were the dead and beneficiaries,” the tribunal said. “A solicitor handling such work is entrusted by those who can no longer speak for themselves to carry out their final wishes with professionalism and care and not for the purpose of unwarranted self-enrichment.”

In an agreed outcome with the solicitor, the Solicitors Regulation Authority (SRA) said one of its forensic investigation officers found a number of “serious issues on probate files” when visiting the firm in 2020. Only AD could authorise payments from the client and office accounts.

AD was sole executor of the estate of OH that made a charity one of his residuary beneficiaries.

Although the client side of a ledger had been debited by £100,000, with a cheque described as going to charity, the charity involved told the SRA that it had not received any money.

The shortage was replaced 549 days later by a payment from office account, the money having passed through AD’s personal accounts.

AD was also sole executor of the estate of RH, where the ledger showed a distribution to the residuary beneficiary of £100,000 in 2019, but the cheque was in fact payable to AD.

The SRA said the money was not fully repaid to client account for 463 days, again having passed through AD’s personal accounts.

An independent costs draftsman instructed by the SRA found overcharging of £198,350 across six probate matters handled by AD, including the two where the money was misappropriated.

He described the charging rate of £300 per hour plus 3% of the value of OH’s estate as “so egregiously excessive as to inevitably give rise to an overcharge”, which in this case amounted to £62,300.

The slightly lower rate of £200 per house plus 3% of the estate’s value applied to RH’s estate was described in the same way, particularly when the firm started charging at £300 per hour. In this case the overcharge was calculated at more than £83,200.

AD was not the executor of the estate of EB and began charging at the “reasonable” rate of £200 per hour plus 1% of the value of the estate, only to “unilaterally” increase it to over £200 plus 3% of the value.

“There is no evidence that the clients were informed of this revision and the firm could not legally unilaterally vary its charging terms as a matter of basic contract law.”

AD was sole executor of JM’s estate, where he charged at the “egregiously excessive” rate of £300 per hour plus 3% of the value.

The SRA said an “appreciable amount of the work being charged for was actually undertaken by an apparently unqualified fee-earner but had been charged at the respondent’s charging rate of £300 per hour”.

The SRA said AD “misappropriated a total of £200,000 from two estates that he was administering”, and “falsified account records and payment documentation” to hide the fact that payments were made to him.

“Much of the money was eventually paid back into the office account through a convoluted route, when the account was overdrawn or over its overdraft facility limit, to assist with the running of the firm and to pay the respondent’s drawings.”

AD offered no mitigation, and it was agreed that he was “unable” to pay the SRA’s full costs. He was struck off by the SDT and ordered to pay £1,000 in costs.