England and Wales Court of Appeal (Civil Division) Decisions

		Royal Courts of Justice Strand, London, WC2A 2LL
		14th October 2008

Sir Anthony Clarke:

1. Mr Razeen comes from Sri Lanka. He is, I understand, 41 years of age. He was qualified as a lawyer in Sri Lanka and practised there from 1993 until he left in 2000. He sought asylum here and was granted asylum here. He appeals from a decision of the Solicitors Regulation Authority ("SRA") to impose conditions on his 2007/2008 practising certificate. The conditions imposed are that:

"1. He may act as a solicitor only:

1.1 in employment or partnership; or

1.2 as a member, office holder or shareowner of an incorporated solicitor's practice,

the arrangements for which have first been approved by the Solicitors Regulation Authority.

2. Mr Razeen shall immediately inform any actual or prospective employer, partner, co-member/office holder/shareowner of these conditions and the reasons for their imposition."

2. The conditions were imposed by Miss Gill, an authorised officer of the SRA, on 12 February 2008 and confirmed on 25 March 2008, when an appeal by Mr Razeen was dismissed by Mr Venables, an SRA adjudicator. Mr Razeen seeks an order that he be issued with a certificate free of conditions or, in the alternative, such as would enable him to practise on his own account. He has further indicated willingness for two particular conditions to be imposed on his practising certificates, namely:

(1) that he will only practise as an immigration solicitor, and

(2) that he will not operate a client account.

As I understand it, it is possible for a solicitor to perform fixed fee work and, if he or she does, to do so without the necessity of operating a client account. That is a practice which is authorised, as I understand it, by the Rules. I should also add that Mr Ryan has drawn my attention to a change in the relevant rules since the matters which formed the basis of the imposition of the conditions to which I have referred. Until some time in 2007, when the Rules were changed, a person in the position of Mr Razeen could not practise as a sole principal. However, since that date it is common ground that the combined effect of paragraph 5.02(1)(a) and (2)(b) of the Rules is that by reason of his admission as a lawyer in Sri Lanka he has been "entitled to practise as a lawyer for at least 36 months within the last ten years" so that he would now, absent the conditions, be entitled to practise as a sole principal. That was not, however, the position when the matters which gave rise to the imposition of the conditions took place.

3. He was admitted as a solicitor on 1 June 2004. From March 2005 he practised under the style of Clifton Solicitors in partnership with a Mr Rodrigo. That partnership was dissolved on 15 December 2006. From that date until July 2007 Mr Razeen was unable to practise as a sole practitioner, as I have just explained. On 26 April 2006 Clifton Solicitors were the subject of an inspection by the Law Society's Forensic Investigation Unit. On 27 May 2006 a report of that inspection was issued. It noted that the firm did not have a client account because it worked on a fixed fee basis only. It further noted that its account books were compliant with the Solicitors' Accounts Rules. However, it raised concerns that the partnership was not a genuine partnership. It did so in the light of comment by Mr Rodrigo among other things that he did not take either a salary or a profit from the firm but would soon draw a salary of £800 a month, which contrasted with £20,000 in drawings that Mr Razeen had made; that he supervised and sought clients but could not provide any details or attendance notes to evidence the claim; and that he was unable to recall the name of the client he dealt with the previous day. He later admitted that he did not see clients, that he had difficulty in completing the firm's address and was unable to recall its postcode. He had difficulty recalling the names of staff members.
4. As a consequence of the report the conduct of Mr Rodrigo and Mr Razeen was referred to the Solicitors Disciplinary Tribunal (SDT). On 19 February the Law Society issued proceedings before the SDT against Mr Razeen and Mr Rodrigo. Initially two allegations were made: first, that Clifton Solicitors was a sham partnership and, secondly, insofar as Mr Razeen was concerned, that if the partnership was a genuine one he failed to ensure that it was adequately and properly supervised. The matter came before the SDT in October 2007. It is important to note that the SRA withdrew the first allegation, that of sham partnership by consent, but Mr Razeen pleaded guilty to the second allegation. The SDT reprimanded Mr Razeen for his conduct and rendered him jointly and severally liable with Mr Rodrigo for the costs of the proceedings. For his part Mr Rodrigo was fined £1,000.
5. Reaching its decision the SDT said:

"[Mr Rodrigo] had not discharged his responsibilities as a supervisor. [Mr Razeen] had allowed himself to be a partner in a firm which was not properly supervised. The Tribunal noted however that [Mr Razeen] appeared to have run the firm efficiently. The books of account had been in good order despite the unannounced inspection and there had been no complaints by clients."

6. A second consequence of the report was that on 18 January 2007 regulatory conditions were placed on Mr Razeen's 2006/2007 practising certificate. The conditions imposed were in the same terms as those which are the subject of the present appeal. Mr Razeen obtained subsequently approved employment with Aldgate Solicitors. He worked there from April to June 2007. He left the firm due to what he says were difficulties arising from an increase in the firm's indemnity premiums caused by his employment and the burden of those conditions placed on his employer. As I understand it, since then he has been unemployed. The documents do not indicate what attempts Mr Razeen has made to obtain employment. However, I have been told on instructions by Mr Ryan that he has had some discussions with solicitors within his community, and that when those solicitors have discovered the history of the matter and the conditions they have been reluctant to employ him or have been willing to do so only on the basis of a much discounted rate compared with what they would pay but for the conditions. It is to my mind unfortunate, however, that there is not more detail about that, I will return to it in a moment.
7. When Miss Gill imposed the conditions which are the subject of this appeal she said this:

"Considering Mr Razeen was found guilty by the SDT of failing to ensure that his firm was adequately and properly supervised and managed, and was reprimanded, I consider that it remains in the interests of the public and the reputation of the profession that Mr Razeen should only practice as a solicitor in an environment which can offer him an additional level of supervision and support."

8. That decision was, as I have indicated, upheld by Mr Venables. He said this:

"1. Mr Razeen was referred to the Solicitors Disciplinary Tribunal on alternative allegations that he had engaged in a sham partnership and that he had breached Rules 1 and/or 13 of the Solicitors Practice Rules 1990 because he had failed to ensure that the firm was adequately supervised and managed at a time when he was not qualified to supervise. The first allegation was withdrawn and he admitted the second.

2. The Tribunal reprimanded Mr Razeen, fined his partner, and ordered them jointly to pay the costs of the proceedings. I understand that Mr Razeen has paid one half of those costs. I have also noted that Mr Razeen's partner who was supposed to be supervising the practice displayed an astonishing ignorance of the details of the practice for someone who was supposed to be supervising it. I conclude that whether or not there was formally a partnership, for all practical purposes there was not.

3. Mr Ryan has argued that Mr Razeen's admission was made on the basis that it was always intended that his partner would attend the office every day to comply with the requirements of Rule 13 of the Solicitors Practice Rules 1990 and that the partner's failure to do so was outside Mr Razeen's control. I observe that the partnership was established in March 2005 and that it plainly continued until April 2006 when the inspection took place and beyond. Mr Razeen appears to have taken no steps whatever to correct the position.

4. In the circumstances I do not accept Mr Ryan's assertion that the second allegation was "vastly different" from the first. I take a serious view of Mr Razeen's being reprimanded. I note that he appears to have displayed a marked lack of regard for the rules of the profession which are established in the public interest. I also observe that he appears to have no experience of handling client money in the firm as there was no client account. In the light of that, I consider that the Solicitors Regulation Authority is entitled to take the view that members of the public would be surprised and dismayed to find that in such circumstances he was allowed to practise on his own account alone.

5. I consider that the condition(s) which I have imposed are both necessary and proportionate in the interests of protecting the public and the reputation of the profession and will enable Mr Razeen to demonstrate that he has some respect for the Rules of Professional Conduct. I have considered whether I could reduce the extent of the conditions, but concluded that it is necessary that his practising arrangements should be approved in order to ensure that Mr Razeen does not repeat his performance when selecting a partner to supervise his practice while the rules required that.

Submissions on behalf of Mr Razeen

9. Mr Ryan has submitted detailed written submissions on behalf of Mr Razeen and has summarised them succinctly and with great clarity this morning orally. He, and indeed Mr Razeen, correctly accept that the power to impose such conditions is a regulatory power. It is not a penal power. However, the thrust of the argument on his behalf is that the conditions imposed are neither necessary nor proportionate in the interests of the public. It is submitted that they are unnecessary because there is no apparent or identified risk to the public that would justify their imposition. It is submitted that they are disproportionate due to the adverse consequences they pose for Mr Razeen's future practice. Mr Ryan draws attention particularly to a passage at paragraph 1018 of Cordery on Solicitors, which states that the purpose of practising certificate conditions is "to protect the public, primarily the solicitor's clients, by managing risk". It is submitted that the SRA has failed to identify any risk to the public.
10. Mr Ryan places particular weight on these factors:
    (1) Miss Gill, when originally deciding to impose the conditions, placed weight on a case worker's report that recommended the imposition of conditions. That report was written, it appears, without sight of the SDT's findings. It was therefore drafted on the flawed assumption that the allegation of sham partnership was a live issue before the SDT. The adjudicator, it is submitted, must therefore have wrongly assumed that an allegation of dishonesty was live before the SDT when it made the decision to reprimand Mr Razeen.

(2) Neither Miss Gill nor Mr Venables placed sufficient weight on the fact:

(a) that Mr Razeen was only convicted of much the lesser of the two offences that were before the SDT, and

(b) that he was only reprimanded.

In particular no credit was given for the SDT's finding that Mr Razeen had run the practice efficiently and that his account books were in good order at the time of the unannounced forensic inspection. On the contrary Mr Venables took the view that Mr Razeen had displayed a marked lack of respect for the Practice Rules.

11. Mr Ryan also submits that Mr Venables made a number of findings in reaching his decision that he should not have done, in particular that by admitting the failure to ensure the practice was properly supervised, he in effect admitted that it was a sham partnership. Mr Ryan further submits that neither Miss Gill nor Mr Venables identified any risk to the public. Finally he submits that Mr Razeen is a man of good character and there is nothing in his professional history to suggest that he is a risk to the public or to suggest that there is any other factor which might justify the imposition of such conditions. As to proportionality it is submitted that the conditions are disproportionate because they result in Mr Razeen being unable to practise as a solicitor. The conditions, it is said, resulted in his employment at Aldgate Solicitors coming to an end. They imposed too onerous a burden on the firm due to the increase in, among other things, its insurance premiums. Further, he has been unable to find alternative employment since June 2007. I have already noted that Mr Razeen would be willing to practise on a fixed fee basis in the field of immigration law: that is, without a client account.

The SRA's submissions and discussion

12. Mr Goodwin submits that the regulatory conditions are imposed either to protect the public interest or the reputation of the profession or both. It appears to me that the essential point is whether the conditions are necessary and proportionate to protect the public interest. Reference to reputation of the profession is really an incident of the protection of the public interest. Mr Goodwin submits that Miss Gill and Mr Venables applied that test when assessing the necessity of imposing the conditions. Given Mr Razeen's evidence and admitted flouting of the rules as they stood at the time regarding supervision during the existence of his partnership with Mr Rodrigo, he submits that it was plainly necessary for the conditions to be imposed. He relies on a passage in the judgment of the then Master of the Rolls, Sir Thomas Bingham, in Re A Solicitor No. 6 of 1993. Although Mr Goodwin has observed that it is important to have regard to the whole of that passage, I will simply read the relevant bit, which is in these terms:

"The purpose of a condition on a practising certificate is not punitive, but is intended to ensure that a solicitor who has run into trouble in a professional capacity is subject to a degree of oversight in the conduct of his professional life at least until he has demonstrated over a period that he is not in need of any such supervision to protect the public"

There are many similar statements of principle by various different Masters of the Rolls, including myself, over the years. It appears to me, however, that Mr Venables had this principle well in mind, and I am not able to accept any submission to the contrary.

13. I am also unable, however, to accept what I think may be Mr Goodwin's submission, that the SRA does not have to identify a specific risk. Absent identification of the risk, it appears to me that the SRA cannot properly assess the reasonableness or proportionality of any conditions that it seeks to impose. However, it also appears to me that there was here a clearly apparent risk to the public which was identified: that was a risk to the public and the reputation of the profession that a solicitor who had practised for nearly three years in a partnership had during the entire period failed to ensure that the practice was properly supervised. For nearly three years Mr Razeen conducted his practice knowingly in breach of his professional obligations. In those circumstances the risk is that the solicitor concerned will not ensure that the relevant regulations are followed.
14. I accept that it is not clear that Miss Gill had in mind the SDT's findings when she made her decision, but it is quite plain that Mr Venables had them well in mind when he came to review the matter on appeal, and I bear them fully in mind today. I am unable to accept that the SRA failed to place sufficient weight on the positive comments made by the SDT. I recognise that those are important, since the SRA must take account of all the facts of the case, both those of a negative nature and those of a positive nature. In short the SRA must have regard to all the circumstances. I would not accept that Mr Venables held that Mr Razeen and Mr Rodrigo operated a sham partnership. He did not so find. What he in effect held was that the case proved, against Mr Razeen was that he operated unsupervised and knew that he was operating unsupervised, when the rules required that there be supervision.
15. In these circumstances it is in my judgment not possible to say that when the SRA, especially Mr Venables, upheld the conditions, it was not necessary or proportionate to do so. It does not follow that the conditions should be imposed for any substantial length of time. I am, however, concerned that the evidence available at the moment does not clearly show what precise efforts Mr Razeen has made to obtain employment. One would have thought that a provision that he obtain employment or partnership the arrangements for which had first been approved by the SRA would not be a bar to his obtaining a job as a solicitor, although I can see that it may place some difficulties in his way. He is plainly a competent solicitor qua solicitor since the evidence is clear that he operated the firm himself perfectly properly and in accordance with the Rules.
16. It appears to me that the right course is for me to dismiss the appeal but to indicate to Mr Razeen that what he should do in the period between now and his making a new application to the Law Society in November (perhaps sooner) in relation to the next year, is to spell out in detail exactly what attempts he has made by reference to precise particulars and to put the whole matter before the SRA. It seems to me that, if he could find a job for a comparatively short period at least, it ought to be possible for the SRA to see their way to granting an unconditional certificate, given his experience and the fact that he has in the past apparently operated the Rules perfectly properly.
17. However, it was a serious matter for Mr Razeen to operate a partnership in circumstances where he knew perfectly well he was not being supervised. So, for the reasons I have given, I conclude that this appeal should be dismissed.

Order: Appeal dismissed

SIR ANTHONY CLARKE

THE MASTER OF THE ROLLS