A solicitor whose law firm used disbursements to pay office bills and staff salaries has been cleared of lacking integrity.

The Solicitors Disciplinary Tribunal yesterday decided that Mladen Kesar, the sole owner of Bromley firm Kesar & Co, had not deliberately misused money paid by the Legal Aid Agency. The firm’s practice manager, non-solicitor Elizabeth Hill, was also cleared of the same allegations.

Kesar had accepted that he used monies intended for disbursements to help sustain his firm, which had struggled following legal aid reforms.

But he denied acting without integrity, saying he was not aware of the accounts rules at the time and was overwhelmed by the work required to run a legal business.

The tribunal accepted his explanation, finding allegations of misusing disbursement money proven based on his admissions but ruling that there was no intent to deliberately breach solicitor rules. He was fined £6,000 and ordered to pay almost £40,000 costs.

During the first day of the hearing on Monday, the tribunal heard that Kesar, who started the firm in 2010, had been investigated by the SRA following complaints from two companies owed money for legally aided work. County court judgment over these debts was obtained in May 2019.

The firm had failed to pay professional disbursements for more than six years, and by 2019 it owed £283,000 to third parties, with the oldest debt going back to 2012.

The SRA had submitted that it was ‘inconceivable’ that Kesar would not have known he was in breach of the rules by withholding payments, but he argued that running his own firm was time-consuming and he was unaware there was any wrongdoing.

Ben Hubble KC, representing Kesar and Hill, said: ‘It is plainly regrettable that the situation has arisen. But in the circumstances it is entirely believable that [they] took this approach in good faith.

‘It is striking that under the solicitors accounts rules [amended in] 2019 the firm would now be entitled to treat block payments in the way they had done previously.’

He told the tribunal that Kesar and Hill were ‘caring professional people who want to serve their clients and community’.

The firm now has 30 staff and 1,000 clients – all of whom would be adversely affected by any restriction on Kesar’s right to practise. The firm had also set up a legal charity in 2013 called Intervene Project which helps people in custody who have been denied access to legal advice and assistance, and Hubble argued this would likely end if the sanctions were anything more than a financial penalty.

Hill was fined £6,000 and ordered to pay almost £18,000 costs. A full judgment with the SDT’s reasons will be published in around seven weeks.

Topics