Writing in NLJ this week, John Gould, chair of Russell-Cooke LLP, examines the Court of Appeal’s decision in Grosvenor Property Developers Ltd v Portner Law Ltd.
The court overturned a finding of dishonesty against a solicitor whose firm handled misappropriated investors’ funds. The trial judge had focused on departures from conscientious professional practice without adequately establishing the solicitor’s actual knowledge and beliefs.
Blind-eye dishonesty requires a specific suspicion and a deliberate decision to avoid investigating it. Untargeted or speculative suspicions are insufficient.
As Gould explains, ‘the problem comes from the lawyer’s intention and reasons for not inquiring further’.
Evidence such as unusually high fees or selective diligence may expose those intentions. Even where incompetence falls short of dishonesty, failures involving anti-money laundering duties can still lead to prosecution or striking off.
