A J Nulty & Another

Findings — machine-extracted (anthropic-batch:claude-opus-4-8); verify against the decision

Two solicitors of Avalon Solicitors faced allegations arising from British Coal (RD/VWF) mining compensation claims. The firm improperly deducted 'success fees' from clients' damages despite being paid by the DTI, misdescribed contingency fee agreements as conditional fee agreements, sent misleading 'mistakenly omitted' letters, failed to give proper costs information, and paid undisclosed referral fees to associated companies (Sureclaim; Miners & General) in which the First Respondent and his family had interests. The Tribunal substantiated all allegations. It made an express finding of dishonesty against the First Respondent (Nulty) for a 3 March 2004 letter to the DTI falsely stating no monies were deducted from clients. Nulty was struck off. The Second Respondent, found less culpable as a junior partner (allegations 1-5 admitted; no dishonesty found; one allegation withdrawn), was fined £15,000. Costs (estimated £180,000) ordered subject to detailed assessment with a one-third deduction; Nulty to pay 90% (interim £60,000 within 28 days) and Second Respondent 10% capped at £10,000, both severally liable.

Duties found breached:

• Not mislead the court
• No taking unfair advantage
• Costs and fee transparency to client
• Disclose referrals, commissions and benefits
• No conflict between current clients
• No improper solicitation or touting

Aggravating factors:

• Express finding of dishonesty against First Respondent regarding the 3 March 2004 letter to the DTI
• Calculated deception via a '3 letter system' misdescribing contingency fee agreements as conditional fee agreements
• Taking advantage of vulnerable clients
• Undisclosed conflict of interest through a labyrinthine network of companies benefiting the First Respondent and his family
• Very large sums deducted from clients' damages (£264,499.42 in success fees) and huge fees received (£35.1m from DTI)
• First Respondent failed to attend, absented himself from jurisdiction and did not cooperate

Mitigating factors:

• Second Respondent was a junior partner with significantly lower financial interest and no personal conflict of interest alleged
• Second Respondent made admissions (albeit late)
• Success fees were repaid to clients
• Unclear and inconsistent Law Society/regulatory guidance at the relevant time on charging additional fees in miners' claims
• Personal and financial hardship suffered by Second Respondent (lost job twice, pay cut) and delay in proceedings (breach of Article 6)