'Gross abuse of vulnerable client': Scathing disciplinary decision involving B.C. lawyer

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A B.C. lawyer committed "egregious" misconduct that amounted to "a gross abuse of his vulnerable client" that left her "destitute," according to a scathing disciplinary decision issued by a law society tribunal. 

The decision, posted online by Monday, followed a 16-day hearing in 2021 that found Peter Darren Steven Hart committed misconduct when handling a family law case in 2013.

The client came to Hart seeking spousal support after the breakdown of her marriage. Once a high-earning mining executive, the tribunal heard that the marriage had taken a devastating toll on her mental health.

"In the years leading up to their separation, she became unable to work, suffered a mental breakdown, attempted suicide and was involuntarily hospitalized," according to the 2021 hearing documents.

When she sought out Hart, she was still "under psychiatric care" and although her former spouse had assets valued between $15 million and $17 million, she was "financially destitute."

Hart was found to have committed three separate types of misconduct, which the tribunal summarized as "exploiting a vulnerable client for his own benefit" while providing "an abysmal quality of service."

'ABSURDLY UNFAIR AN UNJUST' RETAINER

At the 2021 hearing, the tribunal found that Hart had pressured the client into an arrangement where he would receive 20 per cent of any financial settlement he negotiated instead of paying an hourly fee.

"The file was a straightforward family matter in which the client was certain to receive a large settlement. No special skill or service was required or provided. (Hart) provided minimal work," the tribunal found.

Once that was arranged, Hart never met with the client, never brought an application for spousal support, negotiated a settlement without consulting her, and ultimately misappropriated roughly $900,000 once that settlement was paid, according to the 2021 hearing documents. 

Hart used a chunk of that money to take his entire staff on a trip to Las Vegas, the 2022 decision says. 

In 2018, the client sought a review of Hart's fees. According to the tribunal's decision, that review found the service Hart provided led to the client getting "her worst-case result had the matter proceeded to trial."

While Hart had pocketed $1,020,000 – which the tribunal notes was far more than he was entitled to even under the "absurdly unfair and unjust" payment arrangement – the review found the appropriate fee would have been $125,000.

Hart was ordered to pay back the difference of $895,000.

"He has only provided a little over $18,000 – less money than he spent taking his entire office on a holiday in Las Vegas," the 2022 disciplinary decision reads.

'CAVALIER' DISREGARD FOR CLIENT'S VULNERABILITY

In addition to his financial misdeeds, Hart was found to have breached his duty to provide service "at least equal to that which would be expected of a competent lawyer in a similar circumstance."

The failures on that front included not taking any notes, not taking the client's instructions, acting in a way that directly contradicted the client's wishes, not giving her the information she needed to make decisions, and making settlement offers without her knowledge or consent, the law tribunal said.

All of this, the tribunal found, was a "gross culpable neglect of his duties" to the client – particularly given her vulnerability.

"Common sense requires a lawyer working with a mentally ill client to take extra care to ensure the client has a good understanding of the case, the lawyer’s advice and has provided clear instructions," the 2021 decision reads.

"Unfortunately, in this case, the Respondent appeared to view the client’s mental illness as a reason to act without instructions and put his own interests ahead of the client’s."

FAILURE TO 'ACT WITH HONESTY AND INTEGRITY'

The tribunal found Hart was "deliberately dishonest" in several instances. These included telling the client into thinking she would still be able to pursue spousal support after negotiating a settlement that explicitly ruled out that option, lying about why he cancelled a scheduled mediation session, and misleading her about how much she could expect from a settlement, it said.

"More than failing to act without honesty, candour and integrity, the Respondent purposely deceived the Client for his own profit," the 2021 decision says.

IMPACT ON CLIENT

The 2022 disciplinary decision outlines some of the ongoing fallout for the client, who hired Hart as a lawyer almost a decade ago.

"She is financially destitute. What should have been an adequate divorce settlement to ensure her future financial security was decimated (Hart)," the decision reads, adding the ongoing litigation to try and recover her money, as well as the disciplinary proceedings, have prolonged her suffering and undermined her attempt to heal.

"The client has suffered irreparable emotional and financial harm that she will never recover from."

CONSEQUENCES FOR LAWYER

The penalty recommended is disbarment. However, the tribunal notes that Hart has been prohibited from practising law since 2021 as a penalty for his misconduct in another case.

Still, the tribunal said it is the only fitting consequence for the "deliberate and calculated abuse of a mentally ill client for the (lawyer's) own financial benefit." The need to condemn and prevent similar misconduct was also emphasized, as was the way in which Hart's actions had "dishonoured" the legal profession.

Hart did not attend the hearing where the decision on disciplinary action was handed down.

He has also been ordered to pay the law society's costs, which total $60,840.