Complaints, Lawyer Discipline and Public Hearings

 

Citation issued: May 4, 2021

Peter Darren Steven Hart

Citations are authorized by the Law Society of BC's Discipline Committee and list allegations against a lawyer that will be considered at a discipline hearing. Please note that allegations in a citation are unproven until a discipline hearing panel has determined their validity.

Nature of conduct to be inquired into:

Breach of Undertaking to the Law Society

1.  Between approximately April 2017 and May 2017, you breached the terms of your undertaking given to the Law Society dated January 6, 2017 (the “Undertaking”), contrary to one or both of rules 7.1-1 and 7.2-11 of the Code of Professional Conduct for British Columbia, by doing one or more of the following:

(a)  on or about May 9, 2017, signing trust cheque no. 6267 in the amount of $50,000, payable to Victory Litigation Lending Corp., when you had undertaken not to sign trust cheques;

(b)  depositing some or all of $85,000 in trust funds belonging to your client (or former client), MW, into Victory Litigation Lending Corp.’s [Bank #1] Account (the “VLLC Account”) in one or both of the following instances, when you knew or ought to have known that this was neither an arms-length investment, nor satisfactory to the Law Society:

(i)  on or about May 1, 2017, you deposited trust cheque no. 6229 in the amount of $35,000 to the VLLC Account; and

(ii)  on approximately May 9, 2017, you deposited trust cheque no. 6267 in the amount of $50,000 to the VLLC Account; and

(c)  failing to advise the Law Society of your trustee relationship with MW, when you knew or ought to have known that you had undertaken to do so.

This conduct constitutes professional misconduct, pursuant to s. 38(4) of the Legal Profession Act.

Conflict of Interest

2.  Between approximately May 1, 2017 and May 9, 2017, you caused Victory Litigation Lending Corp., a company in which you had an ownership and beneficial interest, to borrow or receive a total of $85,000.00 from your client (or former client), MW (the “Client”), or to then lend those funds to Hart Management Inc., or both, contrary to one or more of rules 3.4-28, 3.4-29, and 3.4-31 of the Code of Professional Conduct for British Columbia and your fiduciary duties, and you failed to do one or more of the following:

(a)  ensure that the Client had independent legal representation;

(b)  disclose and explain to the Client either the nature of the conflicting interest, or explain how or why a potential conflict might develop;

(c)  recommend and require that the Client receive independent legal advice;

(d)  obtain the Client's written consent to act for her;

(e)  ensure that the Client had the capacity to provide informed consent;

(f)  document or retain records concerning any or all conversations or instructions relating to the above; and

(g)  recognize that you ought to have declined to borrow or receive money from the Client in the first place.

This conduct constitutes professional misconduct or conduct unbecoming, pursuant to s. 38(4) of the Legal Profession Act.

Improper Use of Trust Account

3.  Between approximately April 2017 and September 2017, on behalf of your client (or former client) MW, you used or permitted the use of your trust account to disburse some or all of $6,271.20, as set out in Schedule “A” (the “Trust Transactions”), and failed to provide any substantial legal services in connection with the Trust Transactions.

This conduct constitutes professional misconduct, pursuant to section 38(4) of the Legal Profession Act.

Breaches of Accounting Rules

4.  Between approximately April 2017 and September 2017, in relation to one or more of the three (3) transactions set out in Schedule “A” (the “Trust Transactions”), you made, or caused to be made, some or all of $6,271.20 in trust withdrawals on behalf of MW, your client (or former client), from Darren Hart Law Corporation’s [Bank #2] trust account, and you failed to retain all supporting documentation for the Trust Transactions, including, but not limited to bank statements, cancelled cheques, and vendor invoices, contrary to one or both of Rules 3-67 and 3-68 of the Law Society Rules.

This conduct constitutes professional misconduct or a breach of the Act or Rules, pursuant to s. 38(4) of the Legal Profession Act.

5.  On approximately August 1, 2019, in relation to one or more of the three (3) transactions set out in Schedule “B”, you made, or caused to be made, some or all of $4,891.61 in payments on behalf of MW, your client (or former client), from Darren Hart Law Corporation’s [Bank #2] general account (the “General Transactions”), and you failed to retain all supporting documentation for the General Transactions, including, but not limited to bank statements, cancelled cheques, and vendor invoices, contrary to one or both of Rules 3-67 and 3-69 of the Law Society Rules.

This conduct constitutes professional misconduct or a breach of the Act or Rules, pursuant to s. 38(4) of the Legal Profession Act.

6.  Between approximately July 2018 and November 2019, in relation to one or more of the eleven (11) transactions set out in Schedule “C”, you made, or caused to be made, some or all of $42,666.82 in payments on behalf of MW, your client (or former client), from Hart Management Inc.’s [Bank #2] account (the “HMI Transactions”), and you failed to retain all supporting documentation for the HMI Transactions, including, but not limited to bank statements, cancelled cheques, and vendor invoices, contrary to one or both of Rules 3-67 and 3-69 of the Law Society Rules.

This conduct constitutes professional misconduct or a breach of the Act or Rules, pursuant to s. 38(4) of the Legal Profession Act.

7.  Between approximately November 2016 and January 2020, in relation to one or more of the fourteen (14) transactions set out in Schedule “D”, you made, or caused to be made, some or all of $16,501.58 in payments on behalf of MW, your client or former client (the “Payments”), and you failed to retain any or all supporting documentation for the Payments, including, but not limited to bank statements, cancelled cheques, and vendor invoices, contrary to one or more of Rules 3-67, 3-68 and 3-69 of the Law Society

This conduct constitutes professional misconduct or a breach of the Act or Rules, pursuant to s. 38(4) of the Legal Profession Act.

Failure to Meet Financial Obligation

8.  Between approximately May 1, 2017 and March 31, 2021, you breached the terms of a promissory note dated May 1, 2017, between Victory Litigation Lending Corp., a company owned and controlled by you, and your client (or former client) MW, by failing to pay to the order of MW some or all of approximately $31,564.57 when due, or at all, contrary to rule 7.1-2 of the Code of Professional Conduct for British Columbia.

This conduct constitutes professional misconduct or conduct unbecoming, pursuant to s. 38(4) of the Legal Profession Act.