[1]Tribunal: SRA could have saved a “great deal of costs”
The Solicitors Disciplinary Tribunal (SDT) has again criticised the way the Solicitors Regulation Authority (SRA) prosecuted a case against a solicitor, after deciding that a partner who had a “genuine but misguided” belief about the status of one of his employees had not acted dishonestly in what he told his insurer.
The SDT said it was “extremely unhappy” that one of the allegations made against James Prusram Ramdhun was withdrawn on the morning of the hearing, while the SRA sought to amend others at the same time.
“This simply was not acceptable unless there was a good reason for the delay,” the SDT said.
“This was clearly a case where the applicant should have made thorough enquiries of all relevant parties at the outset of the case, which would have saved a great deal of costs.
“The respondent’s statement did not include any new information which was not within the SRA’s knowledge already. As such reviews of this case should have been carried out much earlier.”
In September the SDT made a costs order [2] against the SRA after an unsuccessful prosecution so as to “reinforce its obligation to keep under review the oversight of a case”, while in August the tribunal took the highly unusual step of striking out for abuse of process [3] the prosecution of five solicitors, after finding that the actions of the SRA had made it impossible for them to have a fair trial.
In the present case [4], the SDT heard that Mr Ramdhun, founder of Clapham Law, failed to find indemnity insurance for his firm for the practice year 2013-14, with the result that it entered the cessation period on 31 October 2013.
However, on 9 December 2013, the firm found indemnity cover with Alpha Insurance. The SRA requested copies of Clapham Law’s proposal form, insurance certificate and quotation acceptance.
The regulator alleged that Mr Ramdhun had not named a solicitor, referred to as Mr K, on its proposal form, although he was employed by the firm. It further alleged that Mr Ramdhun had not named other fee-earners or conditions attached to the practicing certificate of partner Nandarajah Ranjithakumaran.
As a result, the SRA alleged that Mr Ramdhun had “given a declaration that was not true” to the firm’s insurers, when accepting a quotation in December 2013, and by doing so he had “acted dishonestly”.
Mr Ramdhun told the tribunal that Clapham Law had two years’ insurance cover from Berliner Insurance, which was not due to expire until September 2014.
“However, around the middle of September 2013 the respondent was informed that Berliner was in financial difficulties.
“He then had little time left to try and obtain alternative insurance. Having realised that the firm was struggling to obtain indemnity insurance, the respondent stated that he had, in November 2013, entered into an agreement with another firm of solicitors in Birmingham who were willing to take over his firm.
“In light of this, the respondent stated he had no reason to make false declarations on the December form dated 6 December 2013, as he had already found another practice to take over his own firm. As his firm managed to secure insurance eventually, the takeover did not go ahead.”
The tribunal said that Mr Ramdhun “genuinely but mistakenly believed” that Mr K was not a consultant at the firm because he was “not taking any active part in dealing with the files”, having decided to join another firm.
The SDT found that Mr K was a consultant, because he was “still carrying out some work on costs on the files”, but the SRA had not proved beyond reasonable doubt that Mr Ramdhun ought to have known this at the time of completing the proposal form.
The SDT also found that the SRA had failed to prove beyond reasonable doubt that Mr Ramdhun did not send the insurer details of two other solicitors at the firm and the conditions on Mr Ranjithakumaran’s PC.
However, the tribunal found that Mr Ramdhun should have disclosed on the quotation acceptance that Mr K had previously been suspended, and, on this “discrete issue”, the partner had breached principle 6 of the SRA Principles 2011.
The SDT found that the reason he had not disclosed Mr K’s disciplinary history was because Mr Ramdhun believed he was not a consultant and he had therefore made “an honest mistake”.
The tribunal found that “such a genuine mistake would not be regarded as dishonest by the ordinary standards of reasonable and honest people”.
It fined him £500 and ordered him to pay costs of £2,000.