Complaints, Lawyer Discipline and Public Hearings

Summary of a decision of the hearing panel on facts and determination

Jeremy Daniel Knight

Kamloops, BC

Called to the bar: May 4, 2015

Ceased membership for non-payment of fees: January 1, 2018

Written materials: April 9 and August 17, 2020

Decision issued: October 15, 2020 (2020 LSBC 48)

Hearing panel: Michael Welsh, QC (Chair), David Layton, QC and Brendan Matthews

Counsel: Tara McPhail for the Law Society; Jeremy Daniel Knight appearing on his own behalf

PRELIMINARY APPLICATION

Jeremy Daniel Knight applied to delay the facts and determination phase of this matter pending release of a review board’ s decision in a similar case, in which a panel determined that misusing client funds while in active addiction should not be described as misappropriation. Knight wished to call evidence to support a similar finding for his conduct, however the review board overturned the panel’ s ruling (2020 LSBC 19).

FACTS

In 2016, Knight removed himself from the practice of law for approximately a month and a half for treatment of substance abuse issues. On the recommendation of a Law Society practice advisor, Knight contacted the Practice Standards department to seek help in resuming the practice of law. He entered into a three-year “ Relapse Prevention Agreement,” which set out his obligations under a monitoring program.

In September 2016, the Practice Standards department ordered a practice review and asked Knight to provide an undertaking to report non-compliance with the Relapse Prevention Agreement. On June 8, 2017, the Practice Standards Committee ordered Knight to cease practising law until he provided a medical report stating he was fit to practise. On January 1, 2018, his membership ceased for non-payment of fees.

While practising law in 2017, Knight was retained to represent a client in a criminal matter. He asked her for a $1,000 retainer to hold in trust. She electronically transferred $700 to his email address, and he deposited it into his personal bank account, which was overdrawn by $1,035.72. He withdrew $600 the same day. A few days later, the client electronically transferred another $300, which Knight again deposited into his personal bank account. He withdrew $260 the same day.

Knight did not issue and deliver a bill to his client prior to depositing her funds, nor did he perform legal services entitling him to the $1,000. Over the course of the retainer, he spent 30 minutes working on her file. He failed record the receipt of funds and did not issue a receipt. Knight emailed the client approximately a month later to tell her he was unable to continue as her lawyer because he was on medical leave for a few months.

A lawyer sent a letter to Knight’ s law firm advising that she had been retained to handle the client’ s matter and asking for a transfer of trust funds. The principal at the law firm determined her firm never opened a file for the client, as the firm was unaware the client had retained Knight and sent him a retainer. The client’ s new lawyer advised the principal her client had transferred the funds to Knight’ s personal email address, at his request.

On a separate matter in 2016, Knight was retained by another client to act for him on several criminal matters. At Knight’ s request, the client’ s partner sent two electronic transfers totalling $4,000, which the law firm deposited into trust.

At Knight’ s request, the client’ s partner provided him with $480 cash. He gave her a receipt, which stated the money was paid “ for legal fees.” Knight did not deposit the cash into the law firm’ s trust account, nor did he account for the funds in any other way.

Knight rendered an account to his client for $3,368.73, which included a disbursement of $345 for a medical report. There is no evidence the account was ever sent to the client. The law firm transferred $3,368.73 from trust in payment of this account. At Knight’ s request, the client’ s partner later sent $345 to Knight’ s personal email address to pay for the medical report. Knight deposited the funds into his personal account, without telling the partner that the report had already been paid from trust.

Knight texted the client’ s partner to explain the client had been arrested and a bail hearing would be held the next morning. He requested $1,000, which he deposited into his personal account. The client’ s partner asked Knight if he needed the $1,000 for bail, and Knight responded that it was required for his work on the matter. He offered to return the money if the client’ s partner did not agree to pay his legal fees. She agreed to pay.

Knight emailed the client’ s partner to request a further $2,000 to “ top up” the retainer, stating that the $650 in trust would be “ used up very easily” in preparing for the client’ s sentencing on the initial charges. The client’ s partner transferred $2,000 to Knight’ s personal email address, and he deposited the funds into his personal bank account.

The client’ s partner asked for a receipt or invoice for her file. Knight did not provide her with a copy of the account and did not explain what he had done with the previous four payments he had deposited into his personal accounts. The client’ s partner sent another electronic transfer of $2,000 to Knight’ s personal email, which Knight deposited into his personal account. There is no evidence to explain the impetus for this transfer.

Knight issued an invoice for $631.26 for services rendered within a 17-day period, which was paid out of the funds remaining in the law firm’ s trust account. During that period, Knight’ s timesheet recorded only one hour of work. There is no evidence the invoice was sent to the client or the client’ s partner.

The law firm’ s principal took over the file and issued a statement of account to the client and the client’ s partner. The principal conducted further inquiries, learned Knight had mishandled money received from the client’ s partner, and made a complaint to the Law Society.

DETERMINATION

In the first matter, the panel determined Knight misappropriated some or all of $1,000 provided to him by the client as a retainer, failed to deposit the funds into a trust account, deposited the funds into his personal bank account prior to rendering a bill for legal services, and failed to record all funds received and disbursed. The panel concluded that, despite his claim that he deposited it into his personal account because of a “ lapse in judgment,” Knight knew he was not authorized to deposit the amounts into his personal account. The first of the transfers occurred days prior to the weekend on which he claims to have been impaired.

In the second matter, the panel found that Knight misappropriated some or all of $5,825 provided to him for payment of retainers and/or disbursements, failed to deposit the retainer and/or disbursement funds into a pooled trust account, deposited the funds into his personal bank account prior to rendering a bill for legal services and failed to account for the receipt of funds.

The panel determined that Knight committed professional misconduct by misappropriating retainer and/or disbursements funds provided to him and using the funds for a purpose he knew was not authorized by his client or his client’ s partner.

2020 LSBC 48 Decision on Facts and Determination