By NEIL HARTNELL
Tribune Business Editor
A ‘senior attorney’ has been found guilty of “gross misconduct” in his representation of clients who acquired property at Exuma’s controversy-stricken Oceania Heights development.
The Bahamas Bar Association’s Disciplinary Tribunal found that Anthony Thompson’s service to Canadian couple, Chris and Jane Bain, fell “far below acceptable standard” after he failed to inform them he was representing both parties to the deal.
Mr Thompson, the Tribunal’s ruling found, neglected to tell the Bains he was both president, and beneficial owner, of Oceania Heights, the vendor that was selling lot 65 at the development to them.
The ruling, which has been obtained by Tribune Business, also found Mr Thompson committed “gross neglect” by failing to pay the necessary Stamp Duty generated by the transaction to the Public Treasury, thus jeopardising the Bains’ ownership of their $400,000 property.
And it also confirmed that Lot 65 had been ‘double sold’ to another buyer, with both they and the Bains receiving real property tax bills for the same land.
Concluding that Mr Thompson’s “misconduct in this matter is gross”, the ruling found: “The Tribunal, in all the circumstances and in light of the facts in evidence, is not satisfied that [Mr Thompson] acquitted himself fully, professionally and in compliance with the [Legal Profession] Act, and finds that the respondent is guilty of conduct unbefitting a counsel and attorney.
“The respondent is a senior member of the Bar. He ought to have advised the [Bains] that he was the president and beneficial owner of Oceania Heights, the vendor company, and obtain their written consent for him to act as attorney for the vendor and purchaser.
“The professional service rendered by the respondent to the [Bains] also falls far below acceptable standard.”
The long-running dispute between Oceania’s homeowners and the property’s developers, Mr Thompson and Canadian citizen Howard Obront, finally appears to be nearing a resolution with the development being transferred to the former’s Association.
However, the actions of Messrs Thompson and Obront have damaged both the Bahamas’, and Exuma’s, reputations as an attractive second home and investment destination. With this damage is long-lasting remains to be seen.
Detailing the factual background to the dispute, the Bar’s Disciplinary Tribunal said the Bains purchased Lot 65 on September 9, 2005, through their company, Yoho Ltd.
Mr Thompson advised them to incorporate Yoho, and the Bains alleged they understood him solely to be acting for their interests.
In fact, as the Tribunal ruling made clear, Mr Thompson was representing Oceania Heights as well, and the Bains alleged they subsequently discovered he was also the company’s president and beneficial owner.
The $400,000 deal attracted Stamp Duty at a rate of 10 per cent, and the Tribunal said the Bains paid 50 per cent - $20,000 - of the sum due to Mr Thompson.
The monies were transferred to the latter’s account at CIBC FirstCaribbean International Bank (Bahamas), and the Tribunal noted the Bains felt “all was well” until they uncovered “certain irregularities” during the dispute over how Oceania Heights was being run.
They were finally informed, in 2010, by Mr Thompson that Stamp Duty had not been paid on their conveyance because they never wired him the funds. The Bains investigated, and found $31,725 was successfully transferred to Mr Thompson’s account, forcing him to change his story and acknowledge the funds’ receipt.
The Tribunal, which featured Justice Rhonda Bain, plus attorneys Cedric Parker, Stephanie Unwala and Lynden Maycock, said Mr Thompson explained at the hearing that two companies were involved in the Bains’ transaction.
While Oceania Heights, which he controlled, owned the development, Mr Obront controlled Oceania Properties, which handles all sales and marketing.
The Tribunal noted that the sales agreement, while identifying Oceania Heights as the property owner, was between Oceania Properties and the Bains. Oceania Properties had no authority to bind Oceania Heights, which the Tribunal suggested showed the inattention paid by Mr Thompson.
As for Oceania Heights’ unpaid $20,000 share of the Stamp Duty, Mr Thompson alleged he was unable to get Oceania Heights and Mr Obront to pay it.
This was despite him being the company’s beneficial owner, and the Tribunal described it as “strange” that this did not make him a signatory to Oceania Heights bank accounts or able to force the company to do his bidding.
“The Tribunal has not investigated [Mr Thompson’s] assertion that he beneficially owns Oceania Heights,” it added, hinting to suspicions that Mr Obront is really its beneficial owner, and that Mr Thompson is merely ‘fronting’.
As for the ‘double sale’ of Lot 65, Phillip Minnis, Oceania Properties’ president, alleged that its original purchaser, Flamingo Haven Ltd, had agreed to exchange it for another lot and that the Bains’ were sole owner.
Yet the Tribunal noted that a Nadia Nedzel was being billed for real property tax on lots 65, 66 and 67, with a 2012 account statement showing a $179,274 bill. And the Bains were also charged $5,995 in real property tax for lot 65 in 2010.
“No explanation was given in evidence of how the double registration of lot 65 with the Real Property Tax Department came to be,” the Tribunal said, noting that Mr Thompson never informed the Bains about the seeming ‘double sale’ and issues this created for their ownership.
It noted, though, that Mr Thompson acted for both sides in the two deals. And the attorney also allowed the Bains’ two entities, Yoho Ltd and Yoho Foundation, to be struck off the Companies Register for not being in good standing despite the couple paying the necessary fees to him on an annual basis.
While Mr Thompson denied it, the Tribunal found his acting for both parties in a deal, and positions with Oceania Heights, meant he “clearly suffered a conflict of interest, having not specifically disclosed his multiple capacities in the transaction to the purchasers up front”.
While there had been some ‘piling on’ by the Bains, the Tribunal found that their conveyance remained unrecorded and unstamped because the necessary Duty had not been paid.
It questioned Mr Thompson’s evidence and understanding of his duties, given his five-year failure to inform the Bains about this and the implications for their ownership of lot 65.
“The issues which arose between the [Bains] and the vendor with respect to Stamp Duty remain unresolved,” the Tribunal ruling said. “The obvious danger is not recording the complainants’ conveyance was apparently ignored by [Mr Thompson], and there is no evidence that he has informed the [Bains] of that danger.
“Six to seven years have passed, and the complainants have yet to secure full completion of this transaction in respect of which they have paid all that the evidence suggests that they contracted to pay.”
Yet, despite all this, Mr Thompson has been punished with just a six-month suspension from practice and a $750 costs bill.