Probate: Overcharging
A solicitor who bought an investment property with money from an estate and then lived in it, and also billed 68 hours for one day’s work, has been struck off.
Joanne Power qualified in 2002, and was the sole principal of Diamonds Legal in Buckhurst Hill, Essex.
Following a qualified accountant’s report, the Solicitors Regulation Authority (SRA) investigated her firm, which it closed in August 2017.
The Solicitors Disciplinary Tribunal (SDT) heard that an SRA forensic investigation officer (FIO) had noticed that because legacy payments had not been made from an estate before the residential property in Loughton, approximately three miles from Ms Power’s office, was bought with the residue for the purported benefit of the estate.
He went to the property, where he saw Ms Power leaving “early one morning” with her dogs.
“This was not what he expected to see. The FIO wondered if the property was being rented out privately and the monies not being paid to the estate. He decided to visit.”
The FIO said his car was parked opposite the property when Ms Power knocked on the window.
Ms Power admitted that she occupied the property, but said “she did so only occasionally”, paying personally, rather than out of the estate, for some of the running costs.
The tribunal found that she occupied it more than she had claimed over a two-year period.
It said: “[She] had treated the property as if it was her own, including paying all the bills, when she knew that the property did not belong to her and that she was occupying it without the knowledge or consent of those who were entitled to benefit from the estate.”
Ms Power was also found to have failed over a number of years to provide various probate clients with adequate costs information, or the basis for calculating her fees, and then to have massively overcharged a number of them.
According to the SRA, one was charged £250,600 for work that was valued by a costs lawyer it commissioned at only £30,000.
In another estate, the recorded transfers from client to office account, when compared to the time-recording documents obtained by the SRA, gave Ms Power a “recovery rate” of over £2,700 per hour.
In a third matter, where the estate was worth over £120,000, Ms Power billed £85,000 plus VAT. The solicitor who took over the case after the intervention said that the firm’s own records showed that the 150 billed hours were only worth £39,000 plus VAT, and in any case “the time recording included an entry for sixty eight hours of work on 9 August 2017”.
Ms Power was also found to have provided misleading information to beneficiaries as to the reasons for delay in distributing the proceeds of an estate
She admitted all the allegations made against her, but refused to accept that she had acted with a lack of integrity, or with dishonesty.
In each case, the tribunal found that Ms Power had acted with lack of integrity, and, in relation to all but the charges of not providing costs information or bills, with dishonesty.
Ms Power argued in mitigation that she had made “errors of judgement” but “maintained her position that any acts, omissions or failings on her part were never with dishonest intent”.
The SDT said Ms Power’s misconduct was planned and a “very serious breach of a position of trust”.
The delay in paying legacies had “caused financial detriment and inconvenience” and there had been overbilling on at least four estates.
The tribunal said one of the beneficiaries, who it considered to be vulnerable, had experienced financial hardship as a result of Ms Power’s actions and there had been “a number of claims” on the Compensation Fund.
Ms Power was also ordered to pay costs of £46,600.