Disciplinary Record - Lewis Denley Ltd

Decision - Sanction

Outcome: Rebuke

Outcome date: 14 March 2023

Published date: 16 March 2023

Firm details

Firm or organisation at date of publication

Name: Lewis Denley Ltd

Address(es): Springfield House, Springfield Road, Horsham RG12 2RG

Firm ID: 655719

Outcome details

This outcome was reached by SRA decision.

Decision details

1. The Firm’s reporting accountant identified for the account period ending 31 July 2020 a number of issues in its report which it brought to the SRA’s attention as required. This formed the basis of an investigation which found that, from 1 August 2019 to 31 July 2021, the Firm:
   1. lacked compliant reconciliations and failed to keep and maintain proper accounting systems which complied with the SRA Accounts Rules 2011 and/or SRA Accounts Rule 2019 (collectively the accounts rules) because:
      1. Client account reconciliations as at 30 April 2021 and 31 July 2021 contained unexplained surpluses which the Firm had not resolved.
      2. A client account shortage of £1,080.00 arose on 23 February 2021.
   2. failed to ensure that the Firm’s books of accounts were maintained in accordance with the accounts rules because:
      1. Client ledgers contained posting errors and/or duplicate cost transfers.
      2. There was a minimum client account shortage of £10,596.23 primarily due to duplicate costs transfers.
      3. There were client debit balances totalling £5,994.56 due to inaccuracies in the ledgers.
   3. failed to keep and maintain a breaches register in accordance with the SRA Authorisation Rules 2011.
2. The failures identified in paragraphs 1(a) and (b) above meant that the Firm’s books of accounts could not be relied upon. It was only after the SRA’s investigation commenced that the Firm identified the cause of why the client ledgers did not accurately reflect the activity in the Firm’s client account.
3. The £1,080 and £10,596.23 shortages were replaced by the Firm in full on 13 July 2021 and 28 February 2022 respectively.
4. The Firm has taken steps to improve its systems ensuring it properly maintains accurate accounting records and carries out proper client account reconciliations, with any differences being investigated and resolved

Reasons/basis

The Firm made the following admissions which the SRA accepted by failing to:

1. ensure that the Firm kept and maintained accurate, contemporaneous, and chronological records the Firm breached Rules 1.2(e), 1.2(f) and 29.1 of the SRA Accounts Rules 2011 and Rule 8.1 of the SRA Accounts Rules 2019.
2. ensure that client account reconciliations were conducted in accordance with the accounts rules the Firm breached Rule 29.12 of the SRA Accounts Rules 2011 and Rule 8.3 of the SRA Accounts Rules 2019.
3. have in place robust financial processes identified in 3.1 (a) and (b) above to ensure the business ran effectively, the Firm breached Principle 8 of the SRA Principles 2011 and Principle 2 of the SRA Principles 2019.
4. keep and maintain a breaches register the Firm breached Rule 8.5(e)(i)(B) of the SRA Authorisation Rules 2011.

The SRA considers that a written rebuke is the appropriate outcome because:

1. The breaches have been rectified but misconduct continued for longer than was reasonable
2. There was no lasting significant harm to consumers or third parties
3. The Firm should have made sure that it had better systems in place
4. A rebuke is appropriate to maintain professional standards and uphold public confidence in the solicitors’ profession and in legal services provided by authorised persons. It reflects the seriousness of the misconduct and provides a creditable deterrent to others.  A rebuke therefore meets the requirements of rule 3.1 of the Regulatory and Disciplinary Procedure Rules.