A former head of private client accused of overcharging an estate by up to £30,000 when acting as executor has been cleared of misconduct by the Solicitors Disciplinary Tribunal (SDT).
However, the SDT also rejected the accusation that the case brought by the Solicitors Regulation Authority (SRA) against Derwent William Moger Campbell was a “shambles”.
The tribunal said Mr Campbell had suggested charging the estate, worth around £1.1m, a fixed fee of £45,000 plus disbursements but “by mistake” this was not reflected in the firm’s engagement letter, as a result of which it was only entitled to time-based charges.
The solicitor was born in 1952 and admitted in 1982. At the time, he was head of private client and the COLP of Mogers Drewett in Bath. He is now a consultant to the firm.
The residuary beneficiary, ‘MN’, complained to the SRA in August 2015 about the way the law firm had handled the estate of his late aunt BD, who died in February 2014. One of the complaints was excessive fees.
Mr Campbell had held power of attorney for BD during her lifetime and had a good knowledge of her assets. He was an executor of her will with another partner at the firm.
The solicitor “knew the deceased and was aware of her family affairs. He knew that the relationship between some family members (also beneficiaries) was dysfunctional”, the SDT noted.
MN agreed to the fixed fee. Mr Campbell did not draft the engagement letter and did not notice the charging error.
The matter team that worked on the estate billed in stages up to the fixed fee, but the value of the firm’s time was only around £15,000 plus VAT and disbursements.
The tribunal rejected the SRA’s allegations, denied by Mr Campbell, that he determined the fees to be charged on an “improper basis”, resulting in unreasonable and excessive overcharging of the estate.
Two fee-earners who worked on the matter described themselves as “uncomfortable” about Mr Campbell’s suggestion of the fixed fee, believing that £20,000-£25,000 was a more reasonable figure.
One said Mr Campbell’s “way of reaching the fee was to ask if you were about to inherit £1.1m how much would you pay to get it.”
The tribunal found that although this had been phrased “inelegantly”, it had not been the sole basis on which the fee was determined.
Mr Campbell’s question had been an attempt “to get more junior fee-earners to challenge their assumptions” and consider wider issues such as the value of the work to the client.
In his evidence, Mr Campbell explained how he and clients preferred fixed fees, considering time-based billing to be the “salvation of the inefficient”.
He explained that he considered “the value of an estate and, by extension, the keenness of beneficiaries to receive their legacies” to be proper factors to take into account when proposing a fixed fee.
Further, it was his understanding that solicitors were entitled to charge for probate work on the basis of a percentage of the value of the estate.
The tribunal said Mr Campbell had brought to the discussion on fees his “greater experience and knowledge of the family background” and it was reasonable for him to raise the issue of the personality of MN and the fact that the solicitor “expected him and the administration to be very difficult” as a result.
It found that the Mr Campbell had “properly” reached the figure of £45,000 – given the size of the estate and the circumstances as he “genuinely perceived” them to be, that had been a “fair and reasonable” decision.
The solicitor could not be criticised because the estate had turned out to be easier to administer than expected.
This was a case of “accidental overcharging” and once the law firm became aware of the mistake with the engagement letter, the estate was refunded.
The SDT usually makes no order for costs when a prosecution fails completely, so long as it was properly brought.
It rejected Mr Campbell’s argument that the SRA’s case had been a “shambles” and said it had been properly brought. As a result, it made no order for costs.