England and Wales Court of Appeal (Civil Division) Decisions

ON APPEAL FROM THE LAW SOCIETY

		Royal Courts of Justice Strand London WC2A 2LL Wednesday 25 April 2001

1. LORD PHILLIPS, MR: This is an appeal pursuant to Section 13(2)(b) of the Solicitors Act 1974 against a decision of an Adjudicator of the Office of the Supervision of Solicitors (OSS), Miss Susan Webb, dated 18 February 2001, which provided as follows:

"Without prejudice to any other outstanding matters and/or issues,

1.Pursuant to the provisions of Section 13A of the Solicitor Act 1974 (as amended), to impose an immediate condition on the current Practising Certificate of Ms F A H Shuttari for the time being in force (namely her Practising Certificate for the practice year 1998/1999) that she may act as a solicitor only in employment which is approved by the Office for the Supervision of Solicitors in connection with the imposition of that condition and that she is not an officeholder and/or shareholder of any incorporated solicitors' practice and that any employer or prospective employer is informed of these conditions.

2.This condition is to become effective within 3 calendar months of the date of the letter notifying Ms Shuttari of this decision."

2. That decision has a long and complex procedural history which itself involves an earlier appeal against a decision of the OSS to which I shall revert.
3. The appellant, Miss Shuttari, was admitted to the Roll of Solicitors in November 1984. Soon after qualifying she set up her own practice together with a more experienced solicitor who became her partner in the law firm. When that relationship broke down in 1989 she then carried on practice as a sole practitioner. She currently practises, and at all material times has practised, under the name Shuttari-Paul & Co. In June 1995 Miss Shuttari appeared before the Solicitors' Disciplinary Tribunal to answer allegations which included that Miss Shuttari had:

"(i) Failed or alternatively been guilty of unreasonable delay in settling Counsel's fees in respect of private clients and had been guilty of delay in securing the taxation of legally aided fees resulting in delay of settlement of Counsel's fees properly due;

(ii) unreasonably delayed in releasing papers to a client's new solicitors pursuant to client's instructions delivered therein;

(iii) unreasonably delayed in the submission of papers for Legal Aid taxation;

(iv) by virtue of each and all of the aforementioned had been guilty of conduct unbefitting of a solicitor."

4. The Tribunal found those allegations to be substantiated. Miss Shuttari was fined £1000 and ordered to pay the costs of the hearing. The tribunal also impressed on her the need to discharge the debts owed to counsel.
5. Miss Shuttari then carried on her practice and took, what was to be described by my predecessor, Lord Woolf, as "modest steps" to settle the debts owed to counsel. However, by early 1997 the barristers concerned and their clerks, being unhappy with the rate of the payment, made a complaint to the Bar Council and to the Law Society. Two further complaints were made to the OSS. One related to non-payment of agent's fees, and the other to inadequate professional services (an allegation of unprofessional conduct when acting for a client). These matters, together with the continuing issue of the failure fully to pay counsel's fees, were referred to the Tribunal.
6. Miss Shuttari made two separate applications for judicial review in relation to the matters referred to the Tribunal, one in relation to non-payment of counsel's fees and the other in relation to the charge of inadequate professional services.
7. While those applications for judicial review were pending and the hearing before the Disciplinary Tribunal was also pending awaiting the outcome of those applications, the OSS decided to impose a condition on Miss Shuttari's Practising Certificate that, within three months of 15 July 1998 she should enter into approved partnership or employment. Miss Shuttari appealed against this condition to Lord Woolf in November 1998.
8. On that occasion, at the outset of his judgment, Lord Woolf said:

"The history of this matter goes back over a great many years. On the whole it reflects no discredit on Miss Shuttari, except that when she was a newly qualified solicitor she went into practice (and then into partnership) when she did not have the knowledge or experience to know how to conduct a practice on her own or in a small partnership. Because of events which occurred earlier in her practising life, she incurred substantial debts as a result of the non payment of counsel's fees."

9. Lord Woolf then set out the history to which he had referred. He accepted the submission made on behalf of Miss Shuttari that she would have difficulty in achieving a satisfactory partnership in order to satisfy the condition that would be imposed on her certificate by the OSS if her appeal was unsuccessful. At page 10 of his judgment he ruled as follows:

"Miss Shuttari told me in her evidence that she would be in a position to offer employment to a suitable solicitor and indicated that if she was given three months in which to do so, the period in which she was given by the Appeals Committee to find a partner, she would be content to accept it as a condition of her certificate, that she should employ a solicitor of suitable experience; suitable experience, I would add, having regard to the nature of her practice.

Miss Shuttari is also content that the person she employs should be somebody acceptable to the OSS. That being so, I propose to allow this appeal and direct that a certificate should be granted to Miss Shuttari, subject to a condition that she employs a solicitor of experience who is acceptable to the OSS."

10. Lord Woolf then advised Miss Shuttari that she should give careful consideration to the question of whether it was in her best interests to continue the judicial review proceedings, having regard to what he described as the "crushing liability" for costs that might be involved. He ended with this observation:

"Looking at this case as a whole, as I have indicated, the situation in which Miss Shuttari finds herself does attract a degree of sympathy. Not unnaturally she has from time to time become frustrated as a result of action taken by the OSS. It is in that regard that she may not have made sufficient allowance, in criticising the OSS, for the responsibilities of that Office. The Office has duties going beyond their responsibility to Miss Shuttari, which have caused them to take the action in the past which she felt has been hard. I understand why the Office took that action, but this is a situation now where a great deal of water has flowed under the bridge since Miss Shuttari was a young solicitor involved in the difficulties to which I have referred. It does appear that she is capable of providing a useful service to her clients. That being so, it must be in everybody's interest that some way of resolving the present combination of disciplinary and related proceedings is found."

11. The decision of Lord Woolf was enforced by imposing on the appellant's Practising Certificate for the year 1998/1999 a condition that within three months of 20 November 1998 she employ a solicitor of experience acceptable to the OSS. In order to comply with that condition, Miss Shuttari employed Mr Kenneth McCaw as a consultant solicitor. He received the approval of the OSS.
12. Following Lord Woolf's decision, Miss Shuttari discontinued the application for judicial review in relation to counsel's fees, but not the proceedings that related to the allegations of inadequate professional services. The fate of the latter was that there was an appeal to the Court of Appeal in which Miss Shuttari was unsuccessful.
13. On 18 November 1999 a hearing took place before the Solicitor's Disciplinary Tribunal in relation to the matters covered by the judicial review application which Miss Shuttari had abandoned. In findings dated 24 January 2000 the Tribunal found that the allegations made against Miss Shuttari had been made out. It ordered that she be suspended from practice as a solicitor for an indefinite period to commence on 18 November 2000, but that, if she had fully discharged all outstanding counsel's fees by that date, a fine of £10,000 would be substituted for the indefinite period of suspension. The tribunal further ordered that she should pay the costs of the application and inquiry. Those amounted to a sum in the region of £5,000.
14. At the end of its decision the Disciplinary Tribunal observed:

"After finding the allegations to have been substantiated at the hearing in November 1999 the Tribunal reached the conclusion that the respondent's stand had been disgraceful. The Tribunal could not help but remark that if the respondent had continued to pay £1,500 per month in reduction of the outstanding counsel's fees then all of those outstanding fees would have been paid off by the date of this hearing. The respondent had shown no respect for her own professional body and her behaviour in that regard was seriously open to question although no formal allegation had been made against her. This was one of the most serious cases of its kind to come before the Tribunal: it was apparent that the respondent had learned little or nothing from the earlier appearance before the Tribunal.

The tribunal was very concerned that counsel should not be kept out of their money. The Tribunal had seriously considered making an order striking the respondent off the Roll of Solicitors. The Tribunal recognised as they had done on the earlier occasion when she appeared before the Tribunal that the respondent had not been guilty of dishonesty and further recognised that such an order would deprive the respondent of her ability to generate fee income as a solicitor. Not only would that damage the respondent but was likely to ensure that the outstanding counsel's fees would not be paid in the foreseeable future."

15. Miss Shuttari did not exercise her right to appeal against that decision.
16. On 8 June 2000 Mr McCaw's employment with Miss Shuttari came to an end. The Law Society wrote a number of letters (the earlier ones going unanswered) asking Miss Shuttari about his replacement. In a letter dated 22 August 2000, Miss Shuttari put forward Mr Vijay Ved as a replacement. The Law Society's reply to that proposal was set out in a letter 24 August 2000. They noted that Mr Ved practised on his own account under the style Ved & Co. They referred to the fact that:

"The condition imposed on your Practising Certificate by the Master of the Rolls is that you employ a solicitor who is able to provide you with support and experience and is acceptable to this Office. If Mr Ved is approved to work at your firm as a consultant, please could you provide the Office with the terms and conditions of Mr Ved's proposed employment and how Mr Ved proposes to manage the sole practice of Ved & Co."

17. On 14 September 2000 Miss Shuttari wrote to the OSS stating that her firm had agreed with Mr Ved that he would attend at the firm on a daily basis for one hour in the morning and one hour in the evening and, in addition, that he would be available for telephone advice and would also attend each week as and when clients were booked in to see him. In those circumstances she repeated her request for the formal approval of Mr Ved. The OSS were not prepared to give that approval. The matter, together with Miss Shuttari's application for a Practising Certificate for the year 1999/2000, was referred to an adjudicator. That adjudicator produced draft recommendations which were submitted to Miss Shuttari in order to give her an opportunity to respond to them. They were as follows:

"1. To grant Ms S A Shuttari a Practising Certificate for the practice year 1999/2000 subject to the condition that she employs a solicitor of experience acceptable to the Office for the Supervision of Solicitors.

2. Ms Shuttari must comply with the decision numbered 1 above within 28 days from the date of the letter notifying her of this decision, failing which, the condition on her Practising Certificate will be substituted with the condition that she may act as a solicitor only in employment which is approved by the Office for the Supervision of Solicitors in connection with the imposition of that condition and that she is not an office holder and/or shareholder of any incorporated solicitors practice and that any employer or prospective employer is informed of these conditions. These conditions are imposed on the grounds that due to her lengthy disciplinary history over a significant period of time with the Office and her history with the Tribunal, it is in the interests of the public and the profession that she practises with substantial supervision and support.

3. The Adjudicator RESOLVES to refuse Ms Shuttari's request to approve Mr Ved's employment as a Consultant at Shuttari-Paul & Co. In making this decision, the Adjudicator has considered Ms Shuttari['s] letters to the Office dated 22 August 2000 and is satisfied that in light of Mr Ved also being the Sole Principal of Ved & Co, he will not be able to provide Ms Shuttari with adequate support and at the same time be able to manage his firm of Ved & Co.

4. The Adjudicator RESOLVES to reprimand Ms Shuttari for her repeated failure to reply to correspondence from the Office.

5. The Adjudicator RESOLVES to reprimand Ms Shuttari for her breach of the condition imposed on her Practising Certificate by failing to employ a solicitor of 'experience' who has been approved by the Office since 8 June 2000."

18. Miss Shuttari responded to the draft recommendation in a letter repeating her application that Mr Ved be approved and ending:

"I would ask for a period of three months and if you refuse to consider Mr Ved as being acceptable then I will have to recruit another solicitor and that will take me more than 28 days."

19. The adjudicator was unmoved. On 1 October 2000 he gave a decision that accorded with the draft, save that the first paragraph read:

"To grant Ms S A Shuttari a Practising Certificate for the practice year 1999/2000 subject to the condition that she employs a solicitor of experience acceptable to the Office for the Supervision of Solicitors. The minimum requirements for acceptance include 3 years post admission experience, an unconditional practising certificate and no adverse disciplinary or regulatory history."

20. Miss Shuttari appealed against this decision to the Appeals Committee of the OSS but the appeal was dismissed on 28 November 2000. She then appealed to me against the Appeal Committee's decision. She has renewed that appeal in conjunction with the appeal to which I referred at the outset of this judgment relating to the later decision. It seems to me that the earlier matter has been overtaken by events.
21. Mr Matthias, on Miss Shuttari's behalf, has submitted that I should start by considering the position as it was at the time of her earlier appeal and that, should I be in her favour in relation to that matter and allow her appeal, against the refusal to approve Mr Ved as providing satisfactory supervision, the subsequent matter would no longer have any relevance. I do not view the position in that way. It seems to me I must look at all the events that have occurred, including the subsequent hearing before the Disciplinary Tribunal and their recommendation. I have then to consider what form of condition should be attached to Miss Shuttari's certificate. Accordingly, I must complete the story.
22. While dealing with the question of the suitability of Mr Ved, Miss Shuttari was facing the further disciplinary proceeding before the Solicitors' Disciplinary Tribunal that followed from her failure before the Court of Appeal in the judicial review proceedings (the complaint of inadequate professional services). The matters relating to that complaint are of some complexity, but they include an allegation of a failure to pay £4,500 to the Legal Aid Board that had been ordered as long ago as 16 July 1997 by the Client Relations Casework Appeals Subcommittee of the OSS.
23. Having set out the lengthy previous history, which I have summarised, the Disciplinary Tribunal concluded:

"In October 2000 the Tribunal was alarmed to discover that the respondent had appeared before the Tribunal on two earlier occasions. They were further dismayed to find that the respondent had apparently adopted an arrogant disregard for her duties and obligations as a solicitor. Her failure to respond promptly to enquiries made of her by the Legal Aid Board and her own professional body caused inconvenience and expense, and prevented either of those bodies from fulfilling their own duties and obligations. The Tribunal takes a very serious view indeed of a solicitor who apparently refuses to comply with a direction made by his [sic] own professional body. The direction remains in full force and effect. The Tribunal could not countenance the continuation of the respondent in practice while she continued to flout a direction made by the Office. Bearing in mind the earlier Tribunal's order, the Tribunal in October 2000 considered it right that the respondent would be suspended from practice as a solicitor for an indefinite period of time if by 18th November 2000 she had not complied fully with that direction. Full compliance with that direction must be evidenced to the Tribunal by way of affidavit lodged at the Tribunal's office by the respondent, to which are exhibited letters from the Office and the Legal Aid Board confirming due compliance. If the respondent does so comply, then in respect of all of the allegations found to have been substantiated against the respondent on this occasion, the respondent will not be suspended from practice for an indefinite period of time, but she will pay a fine of £10,000. The Tribunal wish to make it perfectly clear that this fine is in addition to that imposed upon her on 18th November 1999, in the order of the Tribunal dated 18th November 1999.

In addition to these sanctions, the Tribunal made an order to the effect that the direction made by the Office should for the purposes of enforcement be treated as an order of the High Court.

If the respondent is able to regularise her position by 18th November 2000 and avoid being suspended from practice, the Tribunal wish to recommend to the Law Society that she should not in future be permitted to practise other than in approved employment, or in a partnership first approved by the Law Society."

24. Miss Shuttari has now regularised her position pursuant to the two orders of the Disciplinary Tribunal. She has obtained a substantial loan which has enabled her to make payments, totalling some £35,000, to discharge sums due to counsel and to pay £4,500 to the Legal Services Commission. She has obtained the agreement of the Disciplinary Tribunal that fines totalling £20,000 should be paid by instalments. Miss Shuttari also faces outstanding costs' orders of £13,000 in relation to judicial review proceedings and other of the proceedings to which I have referred in favour of the Law Society. She also intends to repay these by instalments. Although the Law Society issued a bankruptcy petition in respect of this debt, I am informed that that petition has been withdrawn.
25. It was in the light of the recommendation at the end of the Disciplinary Tribunal's most recent finding that the OSS decided to impose an even more draconian condition than that recommended. That is the subject matter of the second appeal. I say "more draconian" because it does not include the option of a partnership.
26. Mr Matthias has submitted that the recommendation of the Disciplinary Tribunal was harsh, and that the findings of that Tribunal did not properly reflect the fact that all the matters that formed the basis of their recommendation were old history. He further submitted that it was not fair or appropriate to describe the failure to comply with the Client Relations Casework Appeal Subcommittee order of 16 July 1997 as flouting the order because his client has had a bona fide challenge to that order. I have seen a letter from the Legal Services Commission which does suggest that they were somewhat perplexed as to why it was that she should have been required to make that payment to them. However, no appeal has been made against the decisions of the Disciplinary Tribunal and I am not in a position to review the conclusions that they reached having heard submissions from Miss Shuttari.
27. Mr Lynch has helpfully made it plain that the Law Society does not consider itself bound to follow the recommendations of the Disciplinary Tribunal. It is anxious to have my guidance as to the way ahead. Mr Matthias has emphasised, on behalf of his client, that there have been no recent complaints about the manner in which her practice is serving the public, and that she appears to have built up a thriving practice the continuation of which is necessary if she is to be in a position to discharge her indebtedness and to pay off the outstanding fines and costs by instalments.
28. As to her practice, Miss Shuttari has submitted an affidavit which shows that there are three solicitors in her employment, all three of whom have only qualified recently, although one has considerable experience of managing a law practice in Pakistan in the past. None of these is considered by the Law Society to be an appropriate solicitor to provide the assistance and supervision that this practice requires. The fact that there are three recently qualified solicitors underlines the needs for proper supervision.
29. Equally, however, it is apparent that there is a thriving practice and that there would be adverse consequences, not merely for Miss Shuttari but for others, if that practice was put out of business, which would be the effect if the more recent condition were to stand.
30. I asked Mr Lynch whether the Law Society would be satisfied with an alternative approach under which the proposed condition would be replaced by a condition that Miss Shuttari should employ in her practice, full-time, a solicitor whose qualifications were satisfactory to the Law Society or, alternatively, that she should enter into a partnership with a partner on terms satisfactory to the Law Society. Mr Lynch indicated that that would seem to meet the Law Society's requirement of ensuring that this practice is properly supervised.
31. No complaint has ever been made by the Law Society of Mr Ved's qualifications. Their concern has been that he has not been in a position to devote sufficient time to supervising Miss Shuttari's practice. Miss Shuttari now tells me that Mr Ved and she would be agreeable to form a partnership. Whether the terms of that partnership would be agreeable to the Law Society would, I apprehend, depend on whether it was in truth a partnership under which Mr Ved became fully responsible, with Miss Shuttari, for that partnership.
32. Having heard Mr Lynch, I propose to adopt the course I have suggested of substituting the condition of the decision of 18 February 2001 with a condition in the terms which I have adumbrated. I would allow Miss Shuttari 60 days to satisfy that condition, failing which, unless the OSS extends time, the condition of 18 February 200l apply.

LORD PHILLIPS, MR: The silence suggests that nobody is applying for costs.

MR MATTHIAS: I am instructed not to make any application for costs.

MR LYNCH: Your Lordship, it is largely a draw so I agree.

LORD PHILLIPS, MR: There will be no order as to costs.