Complaints, Lawyer Discipline and Public Hearings

Summary of Decision on Facts and Determination


Sandra Helen Mary Smaill, QC

Kimberley, BC

Called to the bar: January 14, 1979

Hearing date: December 11, 2019

Panel: Michael Welsh, QC (chair), Thelma Siglos and Sandra E. Weafer

Decision issued: March 3, 2020 (2020 LSBC 14)

Counsel: Michael D. Shirreff for the Law Society; no one appearing for Sandra Helen Mary Smaill, QC

FACTS

At the time of the facts in this matter, Sandra Helen Mary Smaill, QC was a sole practitioner in a non-computerized office. During the course of a Law Society compliance audit, it was found that she had no central filing system in the firm to store or retain client accounts. Her books and records were in a state of disarray and forensic accountants took months to try and recreate the trust ledgers and postings.

Accounting records, banking records, client files and billing records were not properly maintained or filed. She did not keep current trust ledgers and did not keep a book of entry to record trust transactions received and disbursed by the firm. Her monthly reconciliations were not signed and the preparation dates were not recorded, and they contained multiple errors and were not completed in a format consistent with Law Society accounting rules. She did not maintain proper general account records and did not always record the funds received and disbursed in connection with her law practice. She did not keep records of bills for fees and disbursements she incurred, copies of bills or a master file of all bills delivered.

Over the course of three and a half months, Smaill misappropriated or improperly withdrew trust funds by withdrawing residual balances in inactive or concluded client files on 22 occasions. Some of the withdrawals were supported by statements of account that referred to the work done as “file closing” or “file closure.” Her explanation was that the files had been closed for a long time with minimal balances and she was unable to contact the clients. She prepared the accounts for internal records only and did not deliver the accounts to the clients.

Smaill also failed to deposit retainers into her pooled trust account for two clients. She received a total of $4,000 from the first client, but only deposited $1,200. She received a retainer of $700 from the second client and deposited it into her general account, which enabled her to pay overdue invoices to the Law Society.

Smaill improperly withdrew some or all of $5,386.06 from her pooled trust account when she knew the withdrawals were not properly required for payment to or on behalf of a client. She made seven such withdrawals, in amounts between $500 and $1,525.

At the time of the compliance audit, Smaill could not confirm when she lasted filed or made GST remittances. Her statements of account showed she billed and collected GST from her clients, but the Canada Revenue Agency issued a statement of account showing $46,977.16 was owed to the federal government for GST remittances. She also failed to remit employee payroll source deductions. Documents issued by the CRA showed she owed a total of $43,509.52 in arrears, penalties and interest for payroll deductions.

Smaill failed to respond to a Law Society investigator, who left three messages and wrote her letters in July and August 2018. She finally called the Law Society in September 2018 and indicated she did not receive the voicemails. The Law Society confirmed her contact information and re-sent the documents. No further response was received from Smaill.

DETERMINATION

The hearing panel found that Smaill had committed professional misconduct with respect to each of the allegations.

2020 LSBC 14 Decision on Facts and Determination