St. John’s lawyer suspended after audit reveals shortfall in trust account

ST. JOHN’S, NL — A St. John’s lawyer has been suspended from practice for 60 days after violating law society rules and code of professional conduct when it comes to clients’ money held in trust.

The Law Society of Newfoundland and Labrador told an adjudication tribunal it was not suggesting that Susan LeDrew, QC, had acted maliciously, but had been reckless when she withdrew clients’ trust money without ensuring her records were in order.

LeDrew, 52, was subject to a trust audit in December 2018 and a subsequent investigation identified a total trust shortfall of $35.843.32. According to an agreed statement of facts, LeDrew had inappropriately withdrawn the shortfall amounts and failed to document the transfers, using the money for personal purposes. The situation occurred, the statement indicated, because LeDrew had failed to properly record electronically transferred funds, was unable to find a consistently reliable employee and had been experiencing a period of particular stress, and had failed to complete monthly trust reconciliations as per law society requirements .

The violations involved 10 different clients over a two-year period, and included incidents where trust money was transferred to pay for the same invoice two and three times.

“Had LeDrew managed her trust account with the law society rules, including completing monthly trust reconciliations, she would have known her trust account was in a shortfall on a monthly basis,” the statement indicated.

LeDrew had begun to replenish the account after becoming aware of the issue and has since returned all the funds.

The law society argued LeDrew’s actions amounted to misappropriation of clients’ money. While it acknowledged her prior good character and lack of convictions, it submitted she deserved a serious sanction, given her experience and the need to maintain public confidence in the legal profession.

The law society also noted that since the matter had been referred to the discipline panel in July 2020 and LeDrew had been required to submit monthly tax documents and reconciliations, it was required to send her 20 different reminders to do so.

LeDrew argued she had committed unintentional breaches and not intentional misconduct, taking issue with the categorization of her actions as misappropriation. She pointed out the audit had revealed balances that remained in her trust account despite having been earned and billed to her. LeDrew told the tribunal she recognized the seriousness of the charges and described the situation as a “40-month nightmare” that had caused her embarrassment.

“The tribunal is of the view that a reprimand is not a sufficient sanction in the case before it in light of the multiple instances of a violation of trust account rules, the amounts involved and the period over which this conduct continued,” the panel wrote in its decision. It imposed a 60-day suspension, but left it to the law society to determine the timing, noting LeDrew is a sole practitioner, and her clients could be affected. LeDrew’s suspension will be in effect July 28 to Aug. 31 and Sept. 29 to Oct. 23.

As well, LeDrew was ordered to provide specific financial documents to the trust auditor every month for the next year and must pay $2,000 to cover the law society’s investigation and hearing costs.