England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT
(MR JUSTICE LIGHTMAN)

		Royal Courts of Justice Strand London WC2 Tuesday, 23rd April 2002

Tuesday, 23rd April 2002

1. LORD JUSTICE PILL: This is an application for permission to appeal against a judgment of Lightman J dated 17th December 2001. The judge refused an application for judicial review which the applicant, Mr Christopher John Graham White, solicitor of the Supreme Court, had brought against the Office for the Supervision of Solicitors. Complaints had been made to the office by Mr and Mrs B Lavelle against the applicant's firm, Messrs Milne & Layall, Solicitors, in relation to the quality of professional services provided. It was decided, procedures for complaint having been followed (a) that the solicitors failed to provide adequate information as to costs, and (b) that they did not deal with Mr and Mrs Lavelle's complaint reasonably within the requirements of Rule 13. The solicitors were ordered to refund a sum of costs to Mr and Mrs Lavelle and were ordered to pay the sum of £150 compensation to them.
2. The procedure followed was that first, there was an investigation by an investigating officer. The matter then came before a single adjudicator. His decision is entitled "First Instance Decision Client Relations Office", dated 5th October 2000. The solicitors took advantage of their right to appeal against that decision and the appeal was considered by a Casework Sub-committee. Their decision is dated 31st January 2001. They upheld the decision of the adjudicator and increased to £150 the compensation which the adjudicator had ordered. His view was that in all the circumstances the sum of £75 provided adequate redress by way of compensation for distress.
3. For present purposes the events which gave rise to the complaint can be summarised very shortly. Mr and Mrs Lavelle instructed the solicitors in relation to the purchase of a property in Bradpole on 8th January 1998. An estimated figure by way of charge was given to them. A complication arose in that the solicitors very properly and competently discovered that there was no title to a part of the land which was offered for sale. Further work was then done by the solicitors but in the event the purchase fell through. A letter of complaint was written to the solicitors on 19th March 1998. The reply by Mr White was on 29th April.
4. This is a renewed application. I refused it on a consideration of the papers. We have a very detailed skeleton argument prepared by Mr Bonney QC and Mr Staffford for the applicant and that has been supplemented by a further argument prepared on receipt of my refusal on paper and a further note for the assistance of the court. The judgment of Lightman J dealt in some detail with procedural matters, and indeed a complaint now made in the recent note prepared on behalf of the applicant, is that there was insufficient attention to the matters of substance. The judge concentrated on procedural matters and it is now stated that "no issue arises on this appeal on procedural impropriety except in relation to the appeal committee's failure to examine... primary documents..." The application for permission to appeal is against the substance of the decision. Indeed, notwithstanding the amount of written material before the court, the application is based on matters within quite a narrow compass. We have heard oral submissions by Mr Bonney QC of a greater length than one would normally hear upon an application for permission to appeal. They have been most helpful.
5. Schedule 1A of the Solicitors' Act 1974, as amended, is headed "Inadequate Professional Services". Paragraph 1.1 provides:

"The Council [of the Law Society] may take any of the steps mentioned in paragraph 2 ('the steps') with respect to a solicitor, where it appears to them that the professional services provided by him in connection with any matter in which he or his firm have been instructed by a client have, in any respect, not been of the quality which it is reasonable to expect of him as a solicitor.

2. The Council shall not take any steps unless they are satisfied that in all the circumstances of the case it is appropriate to do so."

6. The steps are then set out in paragraph 2 of the schedule. Wide powers are conferred, and with one said to be arguable exception, the steps taken come within those powers if properly exercised. Paragraph 2(3) provides:

"The power of the Council to take any such steps is not confined to cases where the client may have a cause of action against the solicitor for negligence."

7. I have read that paragraph because it must be stated at the outset, and indeed must be kept in mind by anyone reading this judgment, that there has been a complete exoneration of the professional standards of Mr White in terms of his competence and the high standards which he has followed in acting on behalf of his client. I do not propose to repeat the favourable remarks which have been made by Lightman J, and indeed, in rejecting a good deal of the complaint made by Mr and Mrs Lavelle, by the Law Society officers themselves.
8. The order against Mr White's firm was made not on the basis of any failure to follow high professional standards in the investigations he made or in the work he did, but by reason of his allegedly defective customer relations. The adjudicator referred to Rule 15 referred to in chapter 13 of the Law Society Manual, headed "The Guide to the Professional Conduct of Solicitors, 7th Edition 1996", and it is headed "Client Care". It refers to Practice Rule 13(1), which states:

"Every principal in private practice shall operate a complaints handling procedure."

9. There are then detailed requirements as to how such a procedure should be operated. I will refer a little later to a specific requirement of the procedure laid down. Mr Bonney submits that the requirement upon the adjudicator and on appeal from him the Appeal Committee, is to find facts, to consider whether there is a breach of paragraph 1A of the schedule to the Act and to consider whether it is appropriate to take any of the steps set out in paragraph 2. There are three findings against the applicant. The first is that the charges sought to be imposed on the clients were, without warning to them, substantially higher than the charge estimated at the beginning; second, there was a delay in dealing with the complaint; third that the tone of the applicant's response was inappropriate. I repeat, these are all complaints in relation to client care or client relations, what in business is known as customer relations, and do not relate to the competence of the work done. Other complaints were rejected.
10. I turn to the question of the increased charges. What in the event the proposed respondents had ordered is that the applicant should refund to his former clients the difference between what he estimated would be their charge and what he purported to charge them. The applicant dealt with the substance of the letter. He strongly rejected the suggestion that his work had not been of a proper standard and he rejected the suggestion that he was in breach of the appropriate standards by increasing the charge in the manner he did.
11. We have been referred to a part of the client care chapter of the Guide (which I have already mentioned), paragraph 13.07.5. Paragraph 13.07 deals with the approach the solicitor should adopt when confirming clients' instructions. Standard (b) is headed "Confirmation of costs estimate or agreement". Paragraph 5 provides that:

"oral estimates should be confirmed in writing and clients should be informed immediately it appears the estimate will be or likely to be exceeded. In most cases that should be done before undertaking work that exceeds estimate, and solicitors should not wait until submitting the bill of costs."

12. Points arose by way of argument, first, as to whether a client would reasonably believe that an abortive transaction would not cost as much as the completed work; second, as to the information which the clients were in fact given; third as to the opportunity, if any, which the applicant had to notify his client at the appropriate time of the likely additional charge when the complication to which I have referred arose. The applicant had made a site inspection, and that act, we have been told, is unusual on instructions of this kind and undoubtedly it illustrates the conscientiousness of the applicant in seeking to serve the interest of his client.
13. Mr Bonney has addressed us in detail upon the contents of the two decision letters. In public law proceedings it is often a contentious question as to whether a decision has been sufficiently reasoned. It is not necessary to detail all the complaints Mr Bonney makes; they are set out in writing, indeed orally he has not thought it necessary to specify all of them. This court, with experience of dealing with documents of this kind, has had regard to the complaints made. There is force in some of Mr Bonney's submissions and indeed the reasoning is in some respects not as full or as clear as it could be, and we see force in the suggestion that in certain respects inaccuracies may have been present.
14. What this court has to consider, however, is whether it is arguable that on further consideration of the matter the court would quash the decisions given against the applicant. Documents of this kind are not to be construed like Statutes. The court should consider whether the substance of the decision emerges clearly from the documents and whether in all the circumstances the reasoning which led to the decision is sufficiently set out. In my judgment the crux of the complaint found proved does emerge clearly from both the decision letters. The adjudicator, having set out matters of varying importance for present purposes, stated:

"It is therefore surprising to find that, within fourteen days, the costs had escalated from £275.00 to £654.40 and that this had been done without any warning to the client."

15. The subcommittee expressed its agreement with the decision reached at first instance. It stated:

"Nevertheless a sum in excess of 50% over the estimate cannot be acceptable unless discussed with the client and that is not taking into account the fact that the purchase was not completed."

16. In my judgment that is a view of the matter which the proposed respondents are entitled to take. It is important that professional bodies entrusted with the duty of regulating the work of the profession should, subject of course to the supervision of the court, be able to form a judgment as to what conduct falls beyond the required standards. I have referred to the specific paragraph in dealing with the notification of increases in charge.
17. It was found, and entitled to be found in my judgment, that the applicant had an opportunity to tell his clients of the substantial increase which was likely to occur. He did not take that opportunity. I accept that the timescale was condensed, but the proposed respondents were entitled to take the view that in the circumstances the failure was one upon which a sanction should be imposed. The proposed respondents along with other professional bodies are in current conditions understandably anxious to ensure that clients are dealt with in a manner which upholds the reputation of the profession.
18. Mr Bonney submits that the decision is defective in that the reasons put forward as to why the notification was not given had not been set out in the decisions. (These are set out at page 11 of the skeleton argument). It is alleged that the adjudicator's finding was "a gross over-simplification of what actually happened". In summary, first, it failed to take account of the extensive information about costs which had been given to the client; second, the circumstances which led to the increase in charge and the fact that when the original estimate was given the clients were told that it was not necessarily the final amount; third, the necessary inference from the information the clients had and from their attendances at the office that costs were increasing over the estimate and that the charge for such costs would be at an hourly rate.
19. In my judgment the decisions are not defective by reason of failure to spell out those matters. The wording of the Guidance is such that the performance of all those functions can be assumed; and paragraph 5 (which I have cited) must be complied with in most situations, even where the action on which the applicant relies has been taken. I fail to see that the other information available to the clients necessarily provides a sufficient excuse for the failure to notify in terms the increase, as paragraph 5 requires. I am not saying that there could never be a case where other information supplied made the performance of the paragraph 5 guidance unnecessary, but it would, in my judgment, be a rare one. Moreover, it is not my judgment which initially matters, it is whether the proposed respondents were entitled to take the view that they did. I do not consider it arguable, having regard to the responsibilities of the proposed respondents, that they were not entitled to take the view they did as to the duty to notify.
20. We have heard, notwithstanding the suggestion that the appeal is concerned with substance rather than procedure, about the documents which were not read by the committee. However, I cannot see that the failure to read other documents bears upon the central issue to which I have referred. Moreover, any misunderstandings which may emerge from the wording of the decisions does not detract from the force of the findings which the proposed respondents by their appropriate procedures took.
21. The second point is in relation to the finding of delay in replying to the letter. The applicant maintain that the passage of time was not unreasonable and indeed still asserts that and asserted that upon appeal to the subcommittee. There was an issue of fact as to how long it had taken. The applicant referred to the presence of the Easter break coming within the period. The adjudicator concluded:

"It was 25 working days. I consider that that was too long in the circumstances."

22. That, too, was, in my judgment, a finding which the adjudicator was entitled to make. The proposed respondents are entitled in their wish to maintain the standards of the profession to take the view that a delay of as long as occurred in this case was a matter which in professional terms required a sanction to be taken under Schedule 1(a). The position might have been different had the letter been acknowledged with a statement that, having regard to the seriousness of the allegations made, a fuller reply must be delayed in order to permit investigations. That was not what in fact happened; they were simply silent for the period to which I have referred.
23. The third ground upon which the proposed respondents found the applicant to be at fault is in the nature of the reply which was given and the subsequent conduct of the applicant in the proceedings. The adjudicator stated:

"When they did reply they adopted a confrontational approach and in the circumstances the use of the word 'scurrilous' was in my view inflammatory. In the operation of a complaints handling procedure, solicitors are expected to defuse the situation and, taking into account all of these matters, I consider that the solicitors did not operate within the spirit of Rule 15."

24. I do not propose to read the letter in full, the word was used and it is a very strong word, suggesting scandalous conduct by the client. It is still asserted that the word was a proper one in the circumstances. In my judgment the proposed respondents were entitled to take the view that the word should not have been used in the circumstances of this case; and indeed they would be entitled to take the view that it would only be in an extremely rare case that such a word was appropriate. Of course in defending himself a solicitor may have to use strong language, but they were entitled to take the view that this word was inappropriate. In the case of Parliamentary language Parliament determines what can be said in the precincts and what cannot be said. Of course the court has a supervisory function in relation to what is said in letters of this kind, but it must permit those responsible by Statute for maintaining standards, a discretion and an expertise which entitles them to judge within certain limits what is appropriate and what is not appropriate language.
25. The subcommittee also referred, and were entitled to find unacceptable, the "tone of the solicitor's appeal". What they had in mind was the argument addressed in writing to the committee on the applicant's behalf. Having referred to the letter of complaint, it was referred to by the applicant as "disgraceful". Reference was made to:

"... a number of completely fallacious criticisms of the service in order to conclude with a threat to report the matter to the Office for the Supervision of Solicitors with a veiled hint that this would not be done if we were prepared to reduce our bill".

26. The conduct of the client in the light of the true facts is said to be "a threat which was, putting it bluntly, tantamount to blackmail". That is a document which we are told would be disclosed to the former client and which led to the modest increase in the amount of compensation to which I have referred.
27. The approach to be taken to the functions of the proposed respondent in this regard was considered by Lord Taylor CJ in the Divisional Court in R v Solicitors Complaints Bureau ex parte Singh & Choudry [1995] 7 ALR 249. The Lord Chief Justice stated:

"The object of the provision is disciplinary. It is to assist in maintaining the standards to be achieved by solicitors and to provide sanctions in terms of costs and payments if the proper standards are not reached. It is the quality of the service... which is of importance..."

28. A further point is taken before this court which was not taken before the judge. It appears in the further skeleton argument to which I have referred. There is also a reference to further decisions of this court in the Queen's Bench Division in R v Law Society ex parte Shuttari. I have to say that the statements to which we have been referred in Shuttari deal with a somewhat different situation and do not detract, in my view, from the general test which Lord Taylor set out.
29. It is now submitted that there is no jurisdiction upon the appeal committee to increase compensation by reason of the manner in which the appeal is held to have been conducted. Mr Bonney submits that an important point of public importance has arisen. There are a very large number of complaints of this kind pending and it is important on this point in particular, but on the case generally, that this court should take the opportunity to provide guidance as to disciplinary procedures of the kind which I have been considering, the manner in which they should be dealt with and the content of decision letters such as those in this case. It is of course important if there is to be such a general analysis that an appropriate case is chosen for that purpose.
30. I have indicated that, in my judgment, it is not arguable that the applicant could expect a successful appeal upon any of the three findings which were made against him and to which I have referred. I see the force of the argument on this more general point, linked with the third point, but in my judgment it is not a case where permission to appeal should be given on the point. The amount involved is a very small one - the sum of £75. The point was not taken before the judge. Moreover, I am inclined to the view that, notwithstanding the termination of the retainer, the proposed respondents are entitled to take into account the manner in which the complaint is dealt with during the processes of appeal.
31. It would be no service to the applicant in this case to grant permission to appeal on facts which, in my judgment are distinctly unfavourable to him when the costs involved could be considerable. I have regard, of course, to the principle of proportionality.
32. In dealing with the substantive point Lightman J stated (paragraph 27):

"The fourth complaint is that the decisions of the Adjudicator and Appeals Committee are substantively unfair. In particular it is said that the Solicitors had no opportunity to warn the Clients about the increase in costs having regard to the pressure to complete the transaction, and that the Clients' Letter was such as to invite the response it received and that there was no scope in the circumstances for any 'bridge-building'. The answer to this complaint is (as held by the Adjudicator and Appeals Committee and as is plain) there was an opportunity at one of the several interviews with the Clients for the Solicitors to give warning of the increase; and it is part of the professional duty of a solicitor, however much provoked and however ineffective on any gesture on his part may be to allay the animosity of his client, to behave with restraint. The Adjudicator and the Appeals Committee are the judges of the professional standards which solicitors must maintain. I can see no basis for holding that their decisions in respect of the Solicitors' conduct in issue in this case are unreasonable or otherwise open to question."

33. I agree with that analysis. I have sought to deal with some of the matters in more detail in deference to the arguments which Mr Bonney has addressed to this court. I have come to the conclusion that there is no arguable ground for appeal and I would refuse the application.
34. LORD JUSTICE JUDGE: Although I am not unsympathetic to Mr White's predicament when he was faced with the wide-ranging and, as was subsequently established, largely unfounded letter of complaint, I am wholly unpersuaded that the criticism of the judgment of Lightman J is justified or that the present appeal would be arguable.
35. I therefore agree with Pill LJ and his judgment that the present application should be dismissed.
(Application dismissed; no order for costs).