Complaints, Lawyer Discipline and Public Hearings

Summary of Decision on Facts and Determination

Michael Sheldon Golden

Michael Sheldon Golden

Burnaby, BC

Called to the bar: August 1, 1985

Discipline hearing: October 3, 4 and 5, 2018

Panel: Lisa J. Hamilton, QC (chair); Paul Ruffell; Sandra Weafer

Decision issued: December 21, 2018 (2018 LSBC 38)

Counsel: Sarah Conroy for the Law Society; William G. MacLeod, QC, for Michael Sheldon Golden

FACTS

In a family law matter, Michael Sheldon Golden was representing a husband in proceedings against the man’ s wife. The husband was seeking 50 per cent of the equity in the family home, which was owned by the wife.

After Golden had agreed to represent the husband, the wife visited Golden’ s office with a friend, who had also been a client of Golden’ s. The wife and her friend informed Golden that the wife owed the friend $200,000. Golden prepared a promissory note confirming the debt, as well as a power of attorney permitting the wife’ s friend to sell the property on behalf of the wife in order to realize payment of the debt. While the wife was in his office, Golden served her with the action commenced by her husband.

The friend managed the sale of the house, paying the mortgage pending sale, paying for repairs and working with the realtor. The house sold for $560,000. With a mortgage of approximately $300,000, the net return was about $260,000.

The friend asked Golden to handle the conveyance of the property. Golden opened a file in the wife’ s name, and signed a declaration for land title purposes that he was the solicitor for the wife.

Golden took his fees of $1,200 from trust then, on the instructions of the husband, signed and released a cheque for $20,000 to the husband’ s girlfriend. Golden told the wife’ s friend she would receive $124,967.39, not the $200,000 she was owed. The friend refused to accept that amount.

DETERMINATION

When the wife and her friend visited his office, Golden ought to have known that each of three people had different and competing claims to the proceeds of the sale of the property and that it might not be possible to satisfy all of them. The hearing panel believed the wife’ s friend’ s testimony that she was not aware that Golden was representing the husband and that she would not have hired Golden to prepare the promissory note and power of attorney, nor handle the conveyance, if she had known.

Golden was in a conflict of interest when he represented the wife’ s friend in preparing the promissory note while acting for the wife in relation to the sale of the property.

The friend clearly expected she would receive $200,000 from the sale of the property and Golden failed to advise the friend that the promissory note and power of attorney might not be sufficient to secure the funds owed to her. Golden should not have acted for the wife’ s friend on the note and power of attorney because the documents did not protect her interest.

Golden failed to urge the wife to obtain independent legal advice regarding the promissory note and power of attorney, failed to ensure that the wife was not under the impression he was protecting her interests, and failed to make it clear to the wife that he was acting in the interests of the husband.

Golden acted improperly when he withdrew $20,000 of the sale proceeds held in trust on behalf of the wife and disbursed the money to the husband’ s girlfriend without the wife’ s authorization or consent.

The panel dismissed the allegation that Golden acted improperly when he prepared a release for the friend’ s signature that was intended to settle a debt for less than the amount reflected in the promissory note and to release any potential claims against Golden’ s law corporation. Golden never showed her the release, and as soon as Golden knew there was an issue with the amount, he told her to obtain independent legal advice.

The panel found that Golden had committed professional misconduct with regard to four of five allegations listed in the citation and that he also committed a breach of the Law Society Rules.

2018 LSBC 38 Decision on Facts and Determination