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ADJUDICATION PANEL OF THE COUNCIL FOR LICENSED CONVEYANCERS
Application re: Stephen Cox (Respondent)
Date of Adjudication Panel Decision: 4 August 2017
Panel
Emma Boothroyd (Chair of the Adjudication Panel)
ALLEGATION CONSIDERED
THE ROLE OF THE ADJUDICATION PANEL
BACKGROUND
DECISION OF THE PANEL CHAIR
“The Adjudication Panel may, at the request of the parties but only if it considers it appropriate, make a consent order disposing of the proceedings and making such other appropriate provision as the parties have agreed.”
Signed: Emma Boothroyd
Chair
Dated: 4 August 2017
Application re: Simon Alexander Brooks (a Licensed Conveyancer)
Date of Adjudication Panel Hearing: 26 January 2017
PANEL
Carolyn Tetlow (Chair)
Harsha Hildebrand (Member)
Richard Morris (Licensed Conveyancer Member)
ALLEGATION
1. On 26 July 2016, upon your confession, you were convicted in Guildford Magistrates Court of three counts of fraud contrary to sections 1 and 4 of the Fraud Act 2006, which renders you unfit to practise as a licensed conveyancer.
THE ROLE OF THE ADJUDICATION PANEL
2. The CLC has established an independent Adjudication Panel to carry out the functions of the former Discipline and Appeals Committee. The Panel is asked to determine the allegation pursuant to Section 26 of the Administration of Justice Act 1985.
3. Prior to the Hearing the Panel had received a bundle of documents from the CLC numbered 1-134 pages, and a bundle of documents from the Respondent, including written submissions on his behalf and a set of exhibits numbered 1-22 pages. At the Hearing on 26 January 2017 it also received a signed copy of the statement of Ms Dwomoh-Bonsu and, at a later point in the Hearing, a signed statement from the Respondent. It also had the benefit of hearing submissions from Mr Irwin, counsel for the Respondent and from Ms Horlick counsel for the CLC.
BACKGROUND
4. The background may be briefly summarized as follows. Mr Brooks has held a CLC license since 1 September 2005. He was employed as a Licensed Conveyancer by a firm of solicitors, Brooks and Partners (“the firm”), of which his father was the principal. The Respondent decided to set up in business on his own account and to that end gave notice to the firm. His last day in the office was 23 December 2014, although he was apparently on gardening leave until 31 January 2015. The Panel was shown documents from which it is clear that in December 2014 Mr Brooks decided that he would take advantage of his position to divert money to himself before fully leaving the firm.
5. We were shown an email from Mr Brooks to one client dated 1 December 2014 suggesting that the client’s fee might be reduced from £1,000 to £500 provided payment was made to him in cash. Mr Brooks wrote: “How about we agree a much lower fee of say £500? But no vat so just that but you’d need to come in and pay it in cash, if you’re happy with that idea?” The documents also show Mr Brooks altering internal records within the firm so as to show a reduction in fees for two other
clients. Subsequently, in January 2015 Mr Brooks visited the clients and had them pay him £1,000 each in cash. His purported justification was to save them money, including VAT. He then kept the money instead of accounting to Brooks and
Partners, for whom he still held himself out as working. The total amount Mr Brooks took in cash from the three clients and diverted to himself was £2,500.
6. On 26 July 2016 Mr Brooks pleaded guilty at the Guildford Magistrates Court to three criminal offences under the Fraud Act 2006. The offences to which he pleaded guilty were offences of fraud by abuse of his position towards members of the public for whom he had rendered services as a Licensed Conveyancer. Mr Brooks was ordered by the Court to carry out unpaid work and to pay compensation to each of the victims of his fraudulent conduct as well as a sum in costs.
DECISION OF THE PANEL ON THE ALLEGATION
7. The Panel has adopted a three stage approach, considering firstly whether the fact of the convictions is proved, secondly whether the convictions rendered Mr Brooks unfit to practise as a Licensed Conveyancer, and thirdly what, if any, sanction should follow. At the outset Mr Brooks, through Mr Irwin, admitted the convictions and that they rendered him unfit to practise.
8. The Panel had sight of the Certificate of Conviction dated 8 August 2016. On the basis of that certificate and Mr Brooks’ admission it found the fact of the three convictions for fraud by abuse of position proved.
9. The Panel next considered whether the offences render Mr Brooks unfit to practice as a Licensed Conveyancer. It did not consider whether Mr Brooks had breached specific parts of the Code of Conduct because that did not form part of the allegation before the Panel. The allegation relates solely to the convictions.
10. We can deal shortly with the question whether these offences of fraud render Mr Brooks unfit to practice. Subject to the question of sanction, Mr Irwin on behalf of Mr Brooks did not suggest otherwise. There is no doubt, as Mr Brooks’ guilty plea before the Court demonstrates, that this was dishonest conduct, and that these offences of dishonesty were perpetrated towards clients. They were committed in the course of his work as a Licensed Conveyancer over a period of weeks. They were an abuse by Mr Brooks of his position of trust. His actions also impacted on the reputation of the
firm and laid it open to investigation. The Panel noted the evidence that Mr Brooks asked the clients to lie to the firm about the cash transactions, thereby seeking to implicate them in his wrongdoing. The clients were innocent parties in this matter;
they were inexperienced in conveyancing transactions and vulnerable to his deception. The Panel also noted that when the CLC first contacted Mr Brooks about these matters he denied that he had done anything wrong and maintained that the clients had been fully aware and in agreement with what he had done, and had in fact benefitted from it.
11. The Panel also noted that Mr Brooks seems to have set out on his dishonest conduct with premeditation. Before he left the firm he prepared file notes and draft completion statements reflecting the reduced fees that he planned to charge on the invoices issued to the clients, omitting the additional cash payments he then took from the clients. Although apparently his father confronted him in early January with what he had done in relation to one client, this did not stop Mr Brooks from continuing with his frauds in relation to two other clients. He expressed great remorse to his father for what he had done, and said it was a “one off” and that he would not do it again. He continued his fraudulent conduct with other clients nevertheless.
12. The Panel concluded that the offences render Mr Brooks unfit to practice.
DECISION OF THE PANEL ON SANCTION
13. The Panel next considered what sanction would be appropriate within the range specified in section 26(2) of the 1985 Act.
14. The Panel noted that, on a literal interpretation of section 26(1)(a) of the 1985 Act, it could be thought that that proof of a conviction leading to a finding that the respondent is ‘unfit to practise’ would inevitably lead to disqualification, because the respondent has been expressly found unfit to practise as a Licensed Conveyancer. However, it isquite apparent from the remainder of the section that a panel is obliged to consider a range of sanctions, even if it has decided that a Licensed Conveyancer’s criminal offence renders him unfit to practice.
15. Ms Horlick for the CLC reminded the Panel that it should approach the range of sanctions open to it in ascending order of gravity. The Panel accepted thissubmission. Nevertheless, we must record that Mr Irwin realistically accepted that a
lengthy period of disqualification was inevitable. His submission was that we should impose a lengthy but finite period of disqualification rather than permanent disqualification.
16. Ms Horlick submitted that these three offences represented three serious examples of dishonesty involving several clients over a period of weeks. She submitted that Mr Brooks had put his own needs above those of his clients, his employer and the profession. He had asked his clients to lie to cover up his dishonesty. He had not repaid the sums taken from the clients until ordered to do so by the Court. He had not referred himself to the CLC. His insight was very limited and very late, and his reflective statement said nothing about his victims, to whom he had not apologised. Ms Horlick submitted that Mr Brooks’ reflective statements fell far short of demonstrating full insight.
17. Mr Irwin drew our attention to Mr Brooks’ plea of guilty and the shame he had professed. He accepted that this was serious offending and stated that Mr Brooks did not seek to justify his conduct in any way. He submitted that Mr Brooks’
conduct was not fraudulent from the outset and that, although not a single incident, the offences had been committed over a relatively brief period. He also drew our attention to several commendatory references which Mr Brooks had obtained and
which he submitted demonstrated that the offences did not indicate that Mr Brooks’ character was inherently flawed. According to a statement made by Mr Brooks produced in the course of the hearing (this point having been queried by the Panel), these references came from people who had been told of his criminal offences and the regulatory proceedings, and knew the purpose for which the references were required. They do not on their face give an indication that this is so, but we do not need to dwell on this. Either way, we do not consider that they really operate so as to convert the Panel’s view of an appropriate sanction from a permanent to a finite disqualification or any other sanction.
18. The Panel took account of Mr Irwin’s submissions and Mr Brooks’ admissions at the Hearing. It balanced the need to protect the public and uphold proper standards with Mr Brooks’ interests in being able to earn a living as a Licensed Conveyancer.
19. These were offences of premeditated dishonesty committed over a period of weeks towards clients in the course of Mr Brooks’ work as a Licensed Conveyancer. Conduct of this sort seriously undermines the reputation of the profession. It damages the trust which clients are entitled to have in practitioners and which these clients clearly showed in Mr Brooks. Only an order of permanent disqualification is appropriate if public confidence in the profession is to be maintained and an
appropriate level of public protection achieved. No lesser sanction would be sufficient to mark the gravity of this case and uphold the CLC’s regulatory objectives.
20. Whilst this was our conclusion, we should also record that we noted that under section 27 of the 1985 Act Mr Brooks will, notwithstanding the permanent disqualification, be entitled after 10 months to apply to the CLC for a new licence. Whether or not such an application would be successful is not a matter for us. It would be entirely a matter for the committee hearing the application. But we do observe that in reality a permanent disqualification may not necessarily be permanent.
21. The Panel directs that Mr Brooks is permanently disqualified from holding a license.
DECISION OF THE PANEL ON COSTS
22. In conclusion, the Panel was invited to deal with the question of costs. Mr Irwin resisted an order on the basis of what Mr Brooks had already had to pay and that the amount claimed was not reasonable. Of course, £2,500 of that money represented funds that he should never have had in the first place. We were given some details of Mr Brooks’ income and outgoings and we accept that the margin between them is not great. Nevertheless, we consider the Council’s claimed costs of £4,480, as set out in a schedule previously sent to Mr Brooks, to be reasonable. Mr Brooks has brought these
proceedings upon himself and should pay the costs, which would otherwise fall on the profession. However, we would not wish to place an impossible burden on Mr Brooks. We therefore direct that he should pay the CLC’s costs of £4,480 at the rate of £400 per month or such lesser amount, if any, as the CLC may agree.
Signed:
Carolyn Tetlow
Chair
Dated: 26 January 2017
IN THE MATTER OF SIMON ALEXANDER BROOKS
(A LICENSED CONVEYANCER)
AND
IN THE MATTER OF THE ADMINISTRATION OF JUSTICE ACT 1985
Between
The Council for Licensed Conveyancers Applicant
and
Simon Alexander Brooks Respondent
DECISION NOTICE OF THE ADJUDICATION PANEL
AFTER
1. The Adjudication Panel had:
a. Read the Applicant’s bundle of documents, which included a Certificate of Conviction dated 11 August 2016, a Production Statement of Akua Dwomoh-Bonsu dated 25 January 2017 and Affidavits of Alison Jane Mouser made on 27 September 2015 and 2 October 2015
b. Heard Counsel for the Applicant
c. Read the Respondent’s bundle of documents which included various character references, letters from the Respondent and from Tom Ingleton, and a Witness Statement dated 26 January 2017 from the Respondent, and
d. Heard Counsel for the Respondent
2. Respondent had admitted the allegation
3. The Adjudication Panel DETERMINED that the allegation had been proved to its satisfaction.
THE ADJUDICATION PANEL ORDERED:-
1. In accordance with section 26(2)(b) of the Administration of Justice Act 1985 that the Respondent, Simon Brooks, is permanently disqualified starting on 26 January 2017 from holding a licence under Part 2 of the Act.
2. Pursuant to section 26(2A) of the Administration of Justice Act 1985 that the Respondent, Simon Alexander Brooks, do pay to the Council for Licensed Conveyancers the sum of £4,480.00 (in respect of which VAT is not payable), being the costs incurred by it in bringing against the Respondent the proceedings before the Committee, such sum to be paid at a rate of £400 per month (or such lesser amount, if any, as the Council for Licensed Conveyancers may agree), the first payment to be made on or before 1 March 2017, and then on or before the first day of each following month.
Dated January 2017
CAROLYN TETLOW – CHAIR
Members of the Panel
Richard Morris Licensed Conveyancer member
Harsha Hildebrand Lay member
15th June 2016
CLC complaint reference: 2813
Recognised Body: Horizon Law Ltd
Complainant: Legal Ombudsman referral of a complaint by Mr AJ
Date of Adjudication Panel Decision: 7 March 2016
Panel
Ian Melville (Chair – Licensed Conveyancer)
Ed Percival (Member – Licensed Conveyancer)
John Wilson (Member)
Subject matter: Application by a Recognised Body for a case referred for hearing to be determined by correspondence
The CLC has established an independent Adjudication Panel to deal with any reviews of regulatory decisions made by the staff of the CLC. The Panel is authorised to determine allegations of misconduct against Licensed Conveyancers and/or other Recognised Bodies. The Panel operates under the authority of the Administration of Justice Act 1985.
3. Allegation 1 – While a Recognised Body regulated by the CLC, Horizon Law Ltd, failed to act in the best interests of its client contrary to Overriding Principle 3 of the Code of Conduct of the CLC.
4. Allegation 4 – While a Recognised Body regulated by the CLC, Horizon Law Ltd failed to obtain informed written consent from a client confirming that Horizon Law Ltd could act for another client in the matter contrary to Specific Requirement 8 of the Conflicts of Interest Code and Guidance of the CLC.
5. Allegation 6 – While a Recognised Boy regulated by the CLC, Horizon Law Ltd failed to ensure that it did not act, or did not continue to act, for a client where its ability to give independent advice was in any way restricted contrary to Specific Requirement 9(a) and (b) of the Conflicts of Interest Code and Guidance of the CLC.
6. The CLC and the Recognised Body make a joint application for the Chair of the Adjudication Panel to determine the Recognised Body’s application under paragraph 5(2) of the Adjudication Panel Procedure Rules 2013 (“The Procedure Rules”).
7. Given the terms agreed, subject to the determination of the Adjudication Panel, the Recognised Body and the CLC have not agreed directions for taking this matter to a hearing.
8. Under Rule 2 of the Procedure Rules the Adjudication Panel has wide case management powers to resolve cases.The Recognised Body submits (and the CLC agrees) that, in dealing with the case, the Adjudication Panel should have due regard to the issue of proportionality (rule 2(2)(a) Procedure Rules) and the requirement to avoid unnecessary formality (Rule 2(2)(b) of the Procedure Rules).
9. The Recognised Body submits (and the CLC agrees) that the proposal (at Paragraph 2(b) above) “is a proportionate way to meet both the justice of the breach conceded and the mischief that the remaining allegations are directed towards resolving”.
10. The CLC notes that in respect of the three remaining allegations for hearing and determination the Recognised Body accepted Allegation 1 at an early stage in the investigation.In respect of the two remaining allegations the CLC believes that the Recognised Body’s proposals are proportionate to address the CLC’s concerns about the alleged breaches of the Code of Conduct.
11. The CLC draws the Panel’s attention to the fact that the Recognised Body (and Mr P in particular) have taken the disciplinary proceedings seriously as evidenced by the letter from the Recognised Body dated 22 December 2015.
12. In light of the joint application in this case, the Panel has given full consideration to:
a. Letter dated 22 December 2015 – Horizon Law Ltd to the CLC
b. Amended letter of allegation – CLC to Horizon Law Ltd
c. Adjudication Panel Procedure Rules 2013
d. Draft hearing bundle
e. Application for Final Order and documentation referred to therein
13. Having regards to proportionality and having taken into account all of the information and representations put forward by the parties and the Panel having due regard in this case to the protection of the public in general, it is ordered that:
a. the form of undertaking…is accepted in satisfaction of Allegation 4 and
b. Allegations 1 and 6 remain on the file for a period of twenty-four months from the date hereof and not for the period of twelve months as stated in the application and
c. each party bear their own costs
Signed
Ian Melville
Chair 30 March 2016
10th June 2016
Mr Simon Brooks has temporarily and voluntarily surrendered his licence to practise as a licensed conveyancer.
Application re: Brown & Co Property Lawyers Ltd
Date of Adjudication Panel Hearing: 5 April 2016
Panel
Emma Boothroyd (Chair)
Margaret Coats (Member)
Richard Morris (Licensed Conveyancer Member)
While a Recognised Body, Brown & Co. failed to act in the best interests of its client (Mr & Mrs AB) and/or failed to keep the interests of their client paramount (except as required by the law or CLC’s regulatory arrangements) (Overriding Principle 3 and Principle 3(b) of the CLC’s Code of Conduct.)
While a Recognised Body, Brown & Co failed to act in the best interests of its client (Mr & Mrs AB) and/or failed to ensure that their client (Mr & Mrs AB), received good quality independent information, representation and advice (Overriding Principle 1.1 of the CLC’s Code of Conduct).
While a Recognised Body, Brown & Co failed to ensure that it did not act, or did not continue to act, for a client where its ability to give independent advice was in any way restricted (specific Requirement 9(a) and (b) of the CLC’s Conflicts of Interest Code & Guidance).
While a Recognised Body, Brown and Co. Property Lawyers failed to ensure that it did not charge its clients a fee for the work undertaken (other than for disbursements properly incurred) where a conflict arises which was or should have been foreseen. (Specific Requirement 10 of the CLC’s Conflicts of Interest Code and Guidance).
5.The CLC has established an independent Adjudication Panel to carry out the functions of the former Discipline and Appeals Committee. The Panel is asked to approve a consent order to determine the allegations pursuant to Section 25 of the Administration of Justice Act 1985.
6.The Panel received a bundle of documents numbered AP1-28 in advance of the hearing. The Panel had previously considered the hearing bundle numbered AP1-212
7.On the 29 January 2014 Brown & Co was instructed to act for the purchasers (Mr & Mrs AB) in connection with the purchase of a new build house – the Property. Brown & Co also acted for EF who were the developers of the Property. Mr Cudmore acted for AB and Mr Brown acted for EF. Mr Cudmore and Mr Brown are the directors of Brown & Co.
8.Mr & Mrs AB were new clients of the firm and EF were established clients. The property was still under construction at the time Brown & Co were instructed. A dispute arose between Mr & Mrs AB and EF and at one stage Mr & Mrs AB said they wanted to withdraw from the transaction. Mr & Mrs AB were unhappy with the situation and instructed another firm to advise them.
9.The allegations arise out of a complaint by Mr & Mrs AB that Brown & Co failed to act in their best interests.
10.Brown & Co do not accept the allegations and maintain that it acted in the best interests of Mr & Mrs AB and there was no conflict of interest.
11.Following a preliminary investigation on the 12 August 2015 it was determined that the allegations should be referred to the adjudication panel for hearing and determination. The CLC and Brown & Co have requested that the Panel approve a disposal in which allegations 1,2 and 4 are dismissed; and a partial admission is made to allegation 3. Brown & Co have agreed an undertaking not to act for both parties in cases where they act for the developer for a period of not less than 2 years and in relation to allegation 4 a refund of the fee would be made but with no admission of liability or determination by the panel of a breach of the Code.
12. The Panel has considered the papers and the proposal made very carefully and reminded itself that its primary duty was to deal with cases fairly and justly. The panel noted the allegations made against Brown & Co and the partial admission made and considered the evidence presented by both parties.
13. The Panel is being asked to approve a consent order to dispose of proceedings pursuant to Rule 30 (1) of the Adjudication Panel Procedure Rules 2013(as amended) which states,
“The Adjudication Panel may, at the request of the parties but only if it considers it appropriate, make a consent order disposing of the proceedings and making such other appropriate provision as the parties have agreed.”
14. The Panel therefore went on to consider whether it was appropriate to dispose of the proceedings on the basis of the agreement. The Panel looked firstly at allegations 1 and 2. Brown & Co does not consider that it failed to act in the best interests of Mr and Mrs AB and takes the position that no conflict of interest arose and it gave Mr and Mrs AB independent and good quality advice. The CLC agree that these allegations should be dismissed.
15. The Panel considered that in the absence of further evidence presented by the CLC in support of these allegations the Panel is not able to make a finding that these allegations are proved. The CLC are content to offer no evidence in relation to these allegations on the basis that the overall agreement reached addresses the specific conduct. Looking at the proposed resolution and taking into account Brown & Co.’s engagement with the regulatory process the Panel considers that it is not in the public interest to direct these allegations be heard before a full panel.
16. The Panel noted the partial admission in relation to allegation 3. The Panel did consider that there was a breach of the CLC’s Code of Conduct in relation to this transaction and that Brown & Co continued to act for Mr and Mrs AB when a potential for conflict had arisen. The Panel considered that the undertaking offered not to act in these circumstances again for a period of at least 2 years or unless the CLC consents does deal with the conduct alleged and prevents a repetition. The Panel could have imposed such a restriction as a condition of the License but on the evidence it was unlikely to have done so given that this is an isolated incident. Overall the Panel is content that the undertaking as drafted is sufficient to protect the public interest and the partial admission is a recognition that the conduct was unacceptable and must not be repeated.
17. The Panel was concerned that allegation 4 was not admitted and it was not persuaded by the reasoning of Brown and Co and the CLC. However, the Panel considered that the offer to refund the fee addressed the mischief of the allegation and overall it was neither proportionate nor in the public interest to list the matter for a hearing on the basis of this allegation alone. In reaching this decision the Panel took into account the fact that Brown & Co had co-operated with the process and this was an isolated incident. There does not appear to be any systemic failing within Brown and Co and so it is likely that the Panel would have directed return of the money but taken no further regulatory action.
18. In all the circumstances the Panel considered it was appropriate to approve the resolution agreed by the CLC and Brown & Co. However, the Panel considered it would be appropriate for the CLC to consider this determination when deciding what action is appropriate should Brown and Co be the subject of a similar complaint.
Emma Boothroyd
Chair
Dated: 27 April 2016
24th September 2015
IN THE MATTER OF KATHLEEN TURNER
(A LICENSED CONVEYANCER)
AND
IN THE MATTER OF THE ADMINISTRATION OF JUSTICE ACT
Between
The Council for Licensed Conveyancers Applicant
and
Kathleen Turner Respondent
DECISION NOTICE OF THE ADJUDICATION PANEL
Dated 24 September 2015
EMMA BOOTHROYD – CHAIRMAN
Members of the Panel
John Wilson Lay Member
Richard Morris Licensed Conveyancer member
Read the written reasons
At its meeting on 29th October 2015, the Council noted the decision of the independent Adjudication Panel meeting of 24thSeptember 2015 in the matter of Licensed Conveyancer Kathleen Turner (the sole principal of the practice Kathleen A Turner).
The Council wishes to place on record its concern that the penalties may appear to be light in view of the gravity of the breaches of the CLC Code.
Council acknowledges that it would have been helpful have developed guidelines and will do so immediately to assist the Adjudication Panel in future decision-making to ensure that any penalties imposed properly reflect the standards expected of Licensed Conveyancers and the need for consumer protection.
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