A solicitor was found not to have made false declarations on the
certificate of title despite failing to disclose his financial
interest in the transaction, resulting in his convictions for money
laundering and mortgage fraud being overturned.
Mr Cornelius undertook conveyancing for a firm in Swansea and
also invested personally in property. In 2008 he undertook a number
of property transactions where he provided bridging finance to the
purchasers, receiving both his salary from the law firm for his
work and a direct payment from the purchaser.
The law firm and the Building Society lenders were unaware of
his financing involvement in the transactions. There was clear
evidence that the Building Society would not have advanced the
funds if they had been so aware.
The police investigated one of the client's involved in these
transactions and during a review of the files, the conduct of Mr
Cornelius was called into question.
He was arrested and served with a restraint order, which he
later breached by selling a car covered by the order. Mr Cornelius
pleaded guilty for perverting the course of justice with respect to
the breach of the restraint order. He was also charged with fraud
and with transferring the proceeds of crime in relation to the
property transactions.
The prosecution case was that Mr Cornelius acted dishonestly in
the representations made to the Building Society that the property
was unencumbered and that no member of the firm had an interest in
the transaction as a mortgagor, despite the fact that he had made a
loan to the purchaser.
Mr Cornelius' case was that he had not been dishonest, as he
never intended to enforce the declaration of trust and the property
would be unencumbered as soon as the bridging loan was paid.
The court held that the representations in the Certificate of
Title were not false as:
- the building society acquired a good and marketable title free
from the interest created by the trust given to the solicitor
- the solicitor was a lender but not a mortgagor.
The court noted that false representations had been made in
relation to the firm's accounts, but that the case had not been put
to the jury on this basis. They held it was not appropriate to
substitute a charge for attempt to commit fraud nor was it
appropriate to order a re-trial.
However in light of the solicitor's conviction for perverting
the course of justice, the court thought it would be unlikely that
he would be permitted to practice again.
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