Insurance: Solicitor took on clients without cover
A sole practitioner in his 70s has been struck off after practising for over six months without professional indemnity insurance (PII), despite telling others he had cover.
The Solicitors Disciplinary Tribunal (SDT) said David Elden Howes also failed to keep “any books of accounts” for more than a year before his firm was shut down in February 2020.
He took on seven new matters during his firm’s ‘cessation period’ in June and July 2019, and 10 more before his firm was closed by the Solicitors Regulation Authority (SRA).
Mr Howes, principal of David Howes Solicitors in Horley, Surrey, decided not to seek insurance or apply for a practising certificate when his former broker ceased dealing with PII.
The sole practitioner “did not hold attendance notes, emails, or letters, regarding his attempts to obtain Pll” and told the SRA that he could not recall which brokers he contacted to obtain insurance.
The SDT found that Mr Howes, described as “at the upper level of experience”, had acted dishonestly and his misconduct had been “deliberate, calculated and repeated and continued over a period of time”. He had also “concealed his wrongdoing from clients”.
The tribunal heard that the solicitor, born in 1947, was admitted in June 1973 and practised mainly in probate, wills and conveyancing.
Following the expiry of his indemnity insurance in April 2019, his firm went into the extended indemnity period for a month and then for two months into the cessation period, where there is run-off cover but not the indemnity insurance needed to practise.
The SRA said that during the cessation period – when the rules prohibited him from taking on any new clients – “the only thing the firm should have been doing was closing”, but it instead it opened 10 new matters.
Mr Howes admitted dishonestly telling a client for whom he was drafting a settlement deed and the employer of another client which was paying his fees over an agreement, that he had cover.
The SDT said he had acted “in breach of a position of trust” by making these dishonest statements.
“He was experienced in such work and knew that the clients relied on him to tell the truth in acting for them.”
The SDT said Mr Howes, who failed to renew his PC in November 2019 because he had no insurance, was found to have nearly £100,000 in his client account when the SRA began its investigation at the start of February 2020.
The sole practitioner was also found by the SDT to have failed to “keep any books of accounts” between January 2019 and February 2020.
The tribunal concluded: “He had departed to a considerable extent from the complete integrity, probity and trustworthiness expected of a solicitor by acting without valid insurance, making dishonest statements and by holding client money in such a fashion that liabilities to clients could not be ascertained”.
Though there was no evidence of actual harm to clients, the risk was there and the finding of dishonesty meant he had to be struck off absent any exceptional circumstances, which there were not in this case.
He was also ordered to pay costs of £6,500.
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