Taylor Bracewell Law Limited
17-23 Thorne Road, Doncaster, South Yorkshire
, DN1 2RP
Decision - Agreement
Outcome: Regulatory settlement agreement
Outcome date: 4 September 2020
Published date: 11 September 2020
No detail provided:
This outcome was reached by SRA decision.
1. Agreed outcome and undertakings
1.1 Taylor Bracewell Law Limited (the Firm), a licensed body agrees to the following outcome to the investigation of its conduct by the Solicitors Regulation Authority (SRA):
- it is fined £30,540
- to the publication of this agreement
- it will pay the costs of the investigation of £1,350.
1.2 The Firm, and each of its Directors, provides the following undertakings to the SRA:
- to use all reasonable endeavours to repay the loan repayment contribution to clients or otherwise deal with the money in accordance with the Accounts Rules
- to provide details to the SRA of the remedial actions taken by 30 September 2020.
2. Summary of Facts
2.1 On 1 June 2017 the Firm entered into a commercial loan agreement with Property Search Group (PSG) to provide funding of £60,000 towards the purchase of a new case management system.
2.2 The loan represented 50% of the cost of purchasing and implementing the new case management system. The new case management system was installed in February 2018.
2.3 As part of the agreement with PSG, the Firm agreed to order conveyancing searches from it in respect of all of the conveyancing transactions the Firm undertook, until the loan was repaid.
2.4 Each client was charged £193 for the search pack. This included a sum of £18 (the loan repayment contribution) which the Firm used to service the loan agreement to PSG. The Firm did not tell its clients that the fee they were paying for searches included the loan repayment contribution.
2.5 2,225 clients were charged the loan repayment contribution between June 2017 and October 2019, equating to a total sum of £40,050.
2.6 The Firm stopped charging clients the loan repayment contribution at the end of October 2019. The Firm returned all loan repayment contribution monies to client account in May 2020.
3.1 The Firm makes the following admissions which the SRA accepts:
- By charging clients the loan repayment contribution as part of the search fee the Firm failed to protect client money and assets in breach Principle 10 of the SRA Principles 2011 (the Principles)
- By not telling clients that the search fee included the loan repayment contribution the Firm:
- failed to behave in a way that maintains the trust the public places in it and in the provision of legal services in breach of Principles 6
- it did not treat its clients fairly and so failed to achieve Outcome 1.1 of the SRA Code of Conduct 2011.
4. Why a fine is an appropriate outcome
4.1 The SRA’s Enforcement Strategy sets out its approach to the use of its enforcement powers where there has been a failure to meet its standards or requirements.
4.2 When considering the appropriate sanctions and controls in this matter, the SRA has taken into account the admissions made by the Firm and the following mitigation which it has put forward:
- that it accepted the allegations at the earliest opportunity
- that it has returned all the loan repayment contributions to client account and has provided undertakings to the SRA about returning them to clients
- it has co-operated with the SRA’s investigation.
4.3 The SRA considers that a fine is the appropriate outcome because:
- the misconduct continued over a long period of time
- the issue affected a large number of clients
- the Firm had control over charging clients the loan repayment contribution and the information given to clients and so it was directly and solely culpable for the misconduct.
4.4 A fine is appropriate to uphold public confidence in the solicitors' profession and in legal services provided by authorised persons, because it reflects the seriousness of the misconduct and creates a credible deterrent for the Firm and others. A financial penalty therefore meets the requirements of rule 4.1 of the Regulatory and Disciplinary Procedure Rules.
5. Amount of the fine
5.1 The amount of the fine has been calculated in line with the SRA’s published guidance on its approach to setting an appropriate financial penalty (the Guidance).
5.2 Having regard to the Guidance, the SRA and the Firm agree that the nature of the misconduct was low. The Firm has co-operated with the SRA’s investigation and has no similar regulatory history. The Guidance gives this type of misconduct a score of one.
5.3 The SRA considers that the impact of the misconduct was high because although each affected client suffered a relatively small loss, a significant number of clients were affected by the misconduct. The Guidance gives this level of impact a score of six.
5.4 The Firm has an annual domestic turnover of £2,936,527 (turnover period 2018-2019). This means that, for the purposes of the Guidance, it is a firm of greater means and a fine should be determined as a percentage of the Firm’s turnover. The nature and impact scores add up to seven. The recommended broad penalty bracket is £17,619 to £38,175, which equates to 0.6 to 1.3 percent of the Firm’s annual domestic turnover.
5.5 In deciding the level of fine within this bracket, the SRA has considered the mitigation which the Firm has put forward at paragraph 4.2 above.
5.6 The SRA considers that the impact of the Firm’s misconduct was significant because of the number of clients affected. The Firm was directly and solely culpable for the misconduct and was reckless as to whether it breached the SRA’s standards and regulations. The SRA is mindful of the need to create a credible deterrent to the Firm and others. The SRA considers a basic penalty of £38,175, which at the top of the bracket, to be appropriate.
5.7 The SRA considers that the basic penalty should be reduced to £30,540. This reduction takes account of the early admissions of misconduct made by the Firm and its cooperation with the SRA’s investigation.
5.8 Although the Firm made a financial gain from the misconduct, it has since returned that money to its client account and has provided undertakings to the SRA in relation to it. Therefore, it is not necessary to increase the fine to remove the financial benefit to the Firm.
6.1 The SRA considers it appropriate that this agreement is published in the interests of transparency in the regulatory and disciplinary process. The Firm agrees to the publication of this agreement.
7. Acting in a way which is inconsistent with this agreement
7.1 The Firm agrees that it will not deny the admissions made in this agreement or act in any way which is inconsistent with it.
7.2 If the Firm denies the admissions and/or breaches the undertakings referred to in paragraph 1.2 above or acts in a way which is inconsistent with this agreement, the conduct which is subject to this agreement may be considered further by the SRA. That may result in a disciplinary outcome or a referral to the Solicitors Disciplinary Tribunal on the original facts and allegations.
7.3 Acting in a way which is inconsistent with this agreement may also constitute a separate breach of principles 2 and 5 of the Principles and paragraph 3.2 of the Code of Conduct for Firms.
8.1 The Firm agrees to pay the costs of the SRA's investigation in the sum of £1,350. Such costs are due within 28 days of a statement of costs due being issued by the SRA.