A Law Society of BC hearing panel has reached another decision on one of nine citations issued against B.C. real estate and immigration lawyer Hong Guo, since September 2018.
On March 8, a panel ruled that while Guo improperly withdrew $680,000 in May 2019, from a personal bank account jointly owned with a business colleague — in order to cover her clients’ trust account shortages — her actions were not unbecoming of the legal profession, as the society had alleged.
But, Guo was found to have made representations she “knew or ought to have known were false or inaccurate” during the course of the society’s investigation, which was one of 20 it was conducting of her at the time, according to the ruling. The society alleged the representations amounted to professional misconduct or a breach of the Legal Professions Act, and the panel determined it was the latter.
This is the fourth panel ruling of Guo’s nine citations, according to the society’s tribunal website.
Guo was recently ordered suspended for one year starting March 8, after failing to comply with trust accounting rules, among other findings. The society unsuccessfully appealed for her disbarment in that case, which followed a one-month suspension in January 2022, for other trust account violations.
Meanwhile, Guo faces a discipline hearing for professional misconduct that was determined by a hearing panel on Aug. 24, 2022, which ruled Guo failed to provide competent legal services and engaging in conflicts of interests with her clients, following a complex investigation that she did not fully cooperate with. Guo is expected to face further discipline for these latest findings.
The society opened its investigation against Guo after being alerted to a civil claim made against her by Bank of Montreal (BMO), and not a result of any complaint made to the society.
According to the ruling, Guo and her former law school colleague founded a holding company (M Inc.) for a land assembly investment in Surrey. The company bought three properties from 2013 to 2016, when they were valued at $8 million.
Guo’s colleague, known as “HH” in the ruling, claimed he took Guo off the company’s board and removed her signing authority in September 2017; however, this was not properly processed by BMO, where the company’s account was held. Guo claimed to investigators she did not know she was removed and, furthermore, “HH” withdrew money for personal reasons and so she did the same — taking $680,000 from the company’s account, in order to repay trust accounts that Guo claims were emptied in a $7.5-million theft by her bookkeeper. BMO subsequently launched a claim against Guo but later dropped it, according to the ruling.
The preciseness of who had authority on the company’s account is not clear based on the claims of "HH," the panel noted.
“We find that all involved were taking money out of the M Inc. account without proper notification to the other shareholders and we have no trust in this document setting out the whole story by any means,” noted the ruling.
As such, the panel agreed with Guo and her counsel Craig Jones KC that Guo’s withdrawal of funds was not conduct “unbecoming the profession.”
The panel noted the “Law Society has a duty to regulate lawyers’ private lives to ensure they are responsible members of the community as part of the privilege of self-regulation;” however, “a shareholder dispute between two lawyers in a business venture unrelated to any legal work where it appears that each were withdrawing amounts from an account to which they believed they were entitled, is not something with which the Law Society should be involved.”
The citation also dealt with Guo’s conduct with investigators.
“Given our finding that the Respondent (Guo) did know when she was removed as a director, we find that her representations to Ms. Lockhart (the investigator) were knowingly false,” the panel stated.
The panel acknowledged that “certainly signing banking documents as a director when she knew she was no longer a director is a breach of professional integrity” but the society does not expect a “standard of perfection” from a lawyer.
It acknowledged Guo's claim she did not intend to mislead the investigator.
"There were many teams of investigators asking many questions. The Respondent testified that she was not intentionally misleading the Law Society investigation and she was not trying to frustrate the Law Society investigation," the panel stated.
The society is the regulatory body for lawyers and independent of government. The findings against Guo are administrative.
The Richmond-based lawyer, who also has an office in Beijing, is a former legal specialist for the state council of the People’s Republic of China. Guo is facing multiple lawsuits related to business transactions she took part in. She is presently facing an order of incarceration for contempt of court, with proceedings in that matter ongoing.
Guo ran for mayor of Richmond in October 2018, claiming the city needed to reduce crime rates and improve traffic while also promoting more cultural ties and trade with China. She received five per cent of the vote.
Should Guo’s suspension begin March 8 (unless a new date is set by an agreement), she will face significant limits and bans on her practice Guo Law Corporation.