A solicitor left clients “high and dry” by failing to register their property purchases and pay stamp tax, while misappropriating some £175,000 of their money, a tribunal has found.
Nato Zondagh then put up a “wall of silence” by not responding to multiple attempts by the Solicitors Regulation Authority (SRA) to contact him.
Mr Zondagh also failed to engage with the Solicitors Disciplinary Tribunal (SDT), which found his actions dishonest and struck him off the roll.
Born in 1975 and admitted in 2007, he was the owner of London firm Excelsior Solicitors, which he closed on 31 October 2018 following a winding-up order. He had been before the tribunal two years earlier over multiple accounts rules breaches and fined £12,000.
In two cases considered by this SDT, some £128,000 paid by clients for stamp duty land tax and Land Registry applications were “misappropriated or otherwise misused”, with the tax not paid and the transfers not registered.
One of the clients paid HM Revenue & Customs a further £115,350 directly, 18 months after the sale had completed, but the application to register the purchase has still not yet been made because of the pandemic.
The client and his family have been forced to live in rented accommodation as a result, and he told the tribunal that, as well as the financial loss, they had become “very worried and anxious” – in this case, Mr Zondagh had told the client that the tax had been paid and property registered.
In a third case, in 2017 Excelsior held £13,000 from a client as the deposit on the purchase of an investment property but did not transfer it on exchange.
Completion did not take place and two years later the client rescinded the contract, but Mr Zondagh – whose firm had closed by then – did not return the deposit. The client was forced to seek to recoup it from the SRA’s compensation fund.
Finally, £36,000 of money from an estate also went missing. In relation to all of these transactions, the SDT found Mr Zondagh acted dishonestly.
He notified the SRA on 7 November 2018 that he had closed the firm. He said he had not taken any new instructions since September 2018, the firm had arranged for all its existing clients to be transferred elsewhere and so it did not hold client monies.
This was, the tribunal said, “a patent untruth”.
After that, the solicitor did not respond to numerous attempts by the SRA to contact him – first over the closure and then about the complaints it had received – even when the regulator got his new law firm employer to ask him.
As he did not engage in the disciplinary process, the SDT said it was difficult to determine his motivation.
“However, it appeared that the respondent and his firm had benefitted in the region of £175,000 to which he had not been entitled and it was therefore not an unreasonable assumption that his motivation had been a financial one.”
The loss, stress and worry suffered by the clients “could have been easily avoided had the respondent carried out the basic tasks he had been obliged to fulfil and placed in funds to do”.
By not doing so, “he had left his clients ‘high and dry’”.
The tribunal observed that “this had not been a fleeting or momentary lapse of judgment but had been a repeated course of conduct, involving dishonesty and a wall of silence to the regulator” and struck him off.