A partner who maintained that a conditional fee agreement (CFA) was in place for years during the conduct of a claim, when in fact nothing had been reduced to writing, has been issued with a rebuke by the Solicitors Regulation Authority (SRA).
Steven Mather admitted his misconduct and accepted the sanction in a regulatory settlement agreement published yesterday by the SRA.
Mr Mather, who qualified in 2008, joined Leicester firm Josiah Hincks in 2011 as a solicitor. He became a salaried partner shortly after and, in 2013, was made head of commercial litigation.
On 27 November 2012, the firm was instructed by ‘Client A’ to handle a derivative rate swap claim. According to a letter from the firm the previous day, he would be charged 50% of the firm’s normal fees, with the rest under a CFA.
The matter was allocated to Mr Mather in March 2013 to begin the claim, although no signed CFA had been requested from Client A.
In December 2013, Mr Mather drafted and filed a Precedent H costs budget stating there was a CFA dated 27 November 2012 which provided for a success fee. “Mr Mather incorrectly believed that a valid CFA had been orally agreed but a CFA cannot be valid unless it is in writing,” the SRA said.
The following month, the solicitor drafted and sent a notice of funding to the defendant’s solicitors which stated that Josiah Hincks was acting for Client A under a CFA. He confirmed that “the funding arrangement has been in place throughout”, a statement the SRA said he now accepted was factually incorrect.
In 2015, Client A complained about the fees, pointing out that he had not signed a CFA. The client then agreed to the firm’s suggestion to continue the claim under a damages-based agreement.
In an email to the defendant in 2016, Mr Mather referred to the matter being pursued under a pre-2013 CFA.
The agreement said: “At the conclusion of the claim, the remainder of the firm’s costs were invoiced but Client A did not accept these, which led to costs litigation. At the costs hearing on 17 February 2020, Mr Mather confirmed that there was no written CFA.” Mr Mather left the partnership in January 2020.
Mr Mather accepted that he acted in error by failing to obtain a written CFA and relying on an assumed oral CFA, and that he attempted to enforce an oral CFA when he should have known it was not possible.
He admitted that, by “deliberately and repeatedly asserting” there was a CFA in place, when he knew, or should have known, that there was not, he breached principle 6 of the SRA Principles 2011 – maintaining “the trust the public places in you and in the provision of legal services”.
In mitigation, Mr Mather said he was not experienced with CFAs until joining the firm and believed, when he took over conduct of the matter, that it was on the basis of a CFA being in place. “He accepts that he behaved recklessly in not fully checking this position,” the agreement said.
Mr Mather had also co-operated with the SRA investigation “and has expressed remorse”.
The SRA said a written rebuke was the appropriate outcome because “Mr Mather is a senior solicitor, and so should be held to the highest standards” and some public sanction was required to uphold public confidence in the delivery of legal services.
Further, the solicitor’s conduct was “reckless as to the potential risk of harm, allowing parties to be potentially misled as to the existence of a CFA”, and lasted “for longer than is reasonable”.
However, there was “a negligible risk of repetition” and, as the matter was rectified at a costs hearing, “there was no lasting significant harm to the client”.