BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
BUSINESS LIST (ChD)
B e f o r e :
sitting as a Judge of the Chancery Division
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THE FINANCIAL CONDUCT AUTHORITY (A Company Limited by Guarantee) |
Claimant |
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and |
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(1) AVACADE LIMITED (in liquidation) (trading as AVACADE INVESTMENT OPTIONS) (2) ALEXANDRA ASSOCIATES (U.K.) LIMITED (trading as AVACADE FUTURE SOLUTIONS) (3) CRAIG STANLEY LUMMIS (4) LEE EDWARD LUMMIS (5) RAYMOND GEORGE FOX |
Defendants |
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Crown Copyright ©
THE DEPUTY: This is my judgment arising from the hearing before the court on 6 January 2020.
Introduction
Procedural background
The earlier stay application
"It is important to note that paragraph 11 merely records what Dr White was being told. It does not purport to analyse whether or reach a conclusion as to whether what he said is, or might be, correct."
"26. I feel that Mr Craig Lummis is suffering from a severe adjustment disorder secondary to the various issues which are the subject of this case. I do feel that currently his concentration is very poor. He is unable to deal with stressful events and I understand he frequently breaks down crying. He is also drinking excessively, which I understand was not the case prior to 2016."27. I think there are times when he is unable to deal with matters with his solicitor and unable to read the various papers that are provided for him and to advise on what he wishes to be done in relation to them. I do feel that if he were currently called to give evidence, there would be a reasonable chance that he would break down whilst doing so and be unable to give evidence in court. There is, I feel, some risk that he may kill himself.
"28. It is obviously clear that this matter needs to be continued but from the clinical point of view there would be merit in some delay in proceedings, allowing time for treatment and allowing for some time for him to improve. I cannot say absolutely that such a delay will result in improvement, although I do feel that there might well be some benefit in such a delay occurring. I am thinking of a few months and no longer."
"There are two points that arise from the way in which this opinion has been formulated. First, the description of the condition allegedly suffered by the third defendant is described as being a severe adjustment disorder which, as counsel for the applicant accepted, is not a recognised psychiatric condition but is simply another way of saying that the claimant is suffering from stress secondary to the conduct of litigation. It is also clear, particularly from paragraph 28 of the report, that no attempt has been made to set out what, if any, treatment it is proposed should be provided to this defendant in respect of his stress-related condition. Much less has there been an attempt to set out the likely effect of such treatment or its necessary duration before it can be effective. If and to the extent it is a mere delay and thus respite which is the treatment being proposed - something which is not in terms stated - Dr White does not express any view as to what period is appropriate."
"First, it was entirely clear from the submissions made on behalf of the claimant that the focus will be on a relatively small number of test transactions so that it will not be necessary to review each and every one of the transactions that arise. Secondly, and more importantly, on the material that is currently available to me, it seems unlikely that there will be any material dispute as to the primary facts of what happened in relation to the transactions. There will be no doubt some factual dispute and some factual evidence from the defendants relevant to the steps which they took to ensure that the business of the first and second defendants was conducted properly and in accordance with applicable law. However, the evidence is not, or is unlikely to be, so complex as to take this case away from the norm to be expected of financial services litigation; that is, litigation which applies in the industry in which the third and fourth defendants were practitioners."
The evidence
(a) He said that the claim is a high-value, complex one, and also made the point that if the FCA succeeds, either in whole or in part, then the consequences will be ruinous for himself and each of the defendants.
(b) He said that, as of 10 December 2019, he had no legal representation due to ill health and financial reasons.
(c) He pointed to the outstanding issues with the FCA's disclosure as themselves being a source of further stress.
(d) Mr Lummis also pointed out that other investigations and disputes are placing a burden on his health. These include proceedings under the Company Directors Disqualification Act 1986, in which a trial has now been listed for May 2020. They also include an ongoing investigation by the Serious Fraud Office into the affairs of Ethical Forestry Limited, although Mr Lummis made the point that his first scheduled interview did not go ahead due to his ill health.
"Patient presents with acute depressive symptoms and suicidal ideation secondary to stress related to upcoming court proceedings. In my opinion, any forthcoming trials in the three-month period would be detrimental to his health and he should not attend trial."
"I confirm the above is a fully registered patient at Lakeside Surgery, where I work as a GP Partner. I have been asked by Mr Lummis to give a medical statement regarding his consultation with me on Thursday 5 December 2019. He presented expressing suicidal ideation. This appears to have been precipitated by upcoming court proceedings scheduled for 6 January 2020. He alleged that he was being persecuted by the Financial Conduct Authority. He stated that he would hang himself if he was forced to attend court proceedings. He had full mental capacity. He is being prescribed sertraline (a type of antidepressant) to manage his symptoms. He was offered referral for psychological therapy. He was issued with a MED3 certificate from 5 December to 4 March, a copy of which is attached."
"Mr Craig Lummis informed me that he is currently involved in a number of high profile, complex court cases. He reported that, due to the significant financial costs associated with several years of ongoing litigation, he is unable to afford further legal representation. Mr Craig Lummis said that, as a litigant in person, he has 18 boxes of difficult to understand legal documents in his garage to go through in order to prepare for trial. This is a task that he said he realistically does not feel able to cope with. Mr Lummis said that he is seriously considering using these boxes in his garage as a means to hang himself."Mr Craig Lummis informed me that his mental state began to decline after he and his son, Mr Lee Lummis, suddenly and without warning appeared in The Sun newspaper associated with allegations of financial misconduct. Since then, the FCA have issued claims for £86,000,000. The liquidators of the first defendants have issued a letter before claim for £6,000,000 amongst other ongoing related matters. Mr Craig Lummis reported that, according to his understanding, the company for which he was managing director had been proceeding correctly.
"Mr Craig Lummis reported that, due to the ongoing stress from the various court cases and negative publicity for him and his family over the past few years, he has experienced a significant decline in his mental state and general health and wellbeing, exacerbated by underlying physical health conditions, including uncontrolled diabetes and a history of reflux and indigestion. As a result, his relationships have also been negatively affected and he is socially isolated at present.
"Mr Craig Lummis reported struggling as a litigant in person due to the complex nature of his case. He reported that he is currently struggling to maintain any legal correspondence and does not feel fit to stand trial and be cross-examined due to his increasing problems with forgetfulness and difficulty organising his thoughts. He informed me that he has been trying to compensate for the unmanageable stress with increased alcohol intake."
"Anxiety/mood. Mr Craig Lummis reported symptoms indicative of depression, including reduced interest or pleasure in activities, lowered mood, sleep disturbance, fatigue, change in appetite, feelings of worthlessness, loss of confidence, reduced concentration, psychomotor agitation and suicidal ideation since the index events."Mr Craig Lummis reported symptoms associated with generalised anxiety, including feeling nervous, anxious or on edge, not being able to stop or control worrying about various things, trouble relaxing, restlessness, becoming easily annoyed or irritable, and feeling afraid as if something awful might happen since the index events.
"These symptoms were not present before the index events and have not yet resolved."
"Assessment of injuries to establish the extent and duration of any continuing disability."In my opinion, Mr Lummis is experiencing extreme symptoms of post-traumatic stress, and severe symptoms of generalised anxiety and depression including daily suicidal ideation. These meet the criteria for nationally and internationally recognised mental health diagnosis, based on the DSM-5 and ICD-10. From his account, these symptoms were not being experienced prior to the index event. It is my opinion that Mr Lummis' symptoms are reasonable and appropriate to the index events.
"Comment specifically on any areas of continuing complaint or disability or impact on daily living.
"The impact of these psychological injuries has resulted in significantly restricted domestic, family, social, leisure and sporting activities. Mr Craig Lummis is currently socially isolated and mainly housebound due to concerns around negative publicity for him and his family. He reported struggling as a litigant in person due to the complex nature of his case. This is likely exacerbated by the negative cognitive effects of his mental health disorders on his attention, concentration and memory. Mr Craig Lummis reported that is he currently experiencing significant daily suicidal ideation, including plans of using boxes of legal documents in his garage to hang himself.
"If there is continuing disability, comment upon the level of suffering or inconvenience caused and if able to give your view as to when the complaint or disability is likely to resolve.
"Mr Craig Lummis' mental health disorders and environmental stressors are causing him clinically significant distress, functional impairment and reduced quality of life. His symptoms have not shown some improvement. They are unlikely to resolve entirely without psychological and potential psychiatric intervention."
"Summary of diagnosis."• In my opinion, at the time of assessment, Mr Lummis was presenting with the following nationally and internationally recognised mental health disorders:
1. "• Adjustment Disorder (DSM-5 code: 309.28; ICD-10 code: F43.23).2. "• Post-traumatic stress disorder (DSM-5 code: 308.81; ICD-10 code: F431.10).3. "• Generalised anxiety disorder (DSM-5 code: 300.02; ICD-10 code: F41.1).4. "• Major depressive order (DSM-5 code: 293.23; ICD-10 code: F32.2)."• It is my opinion that, at the time of assessment and due to his mental health disorders and ongoing environmental stressors, Mr Craig Lummis' risk of suicide was medium.
"• Based on the above, it is my professional opinion that Mr Craig Lummis' current mental health disorders would be significantly exacerbated by engaging in trial at the present time, and it is highly likely that his risk of suicide would thereby increase from medium to high.
"Summary of aetiology.
"• On the basis of probability, Mr Lummis' psychological symptoms have probably been caused by the index events.
"Summary of treatment recommendations.
"• I would currently recommend 15 to 20 sessions of trauma focused cognitive behavioural therapy (CBT) for post-traumatic stress disorder (PTSD), generalised anxiety and depression. The specific number of sessions should be determined by the therapist.
"• I would currently recommend referral to a psychiatrist for a further assessment of his mental health symptoms and consideration for additional psychotropic medication.
"• It is my recommendation that Mr Craig Lummis requires a period of 6 months' respite from further litigation with immediate effect in order to begin psychological treatment without increased environmental stressors, and that the FCA trial in January 2020 would need to be stayed for this purpose to allow Mr Craig Lummis time to recover.
"Summary of prognosis.
"• It is my opinion that Mr Lummis' psychological symptoms will resolve within 10 to 12 months after starting therapy. A primary determining factor will be if he is able to have a period of respite while starting treatment."
The parties' submissions
The proper approach and the authorities
"Such evidence should identify the medical attendant and give details of his familiarity with the party's medical condition (detailing all recent consultations), should identify with particularity what the patient's medical condition is and the features of that condition which (in the medical attendant's opinion) prevent participation in the trial process, should provide a reasoned prognosis and should give the court some confidence that what is being expressed is an independent opinion after a proper examination. It is being tendered as expert evidence. The court can then consider what weight to attach to that opinion and what arrangements might be made (short of an adjournment) to accommodate the party's difficulties. No judge is bound to accept expert evidence: even a proper medical report falls to be considered simply as part of the material as a whole (including the previous conduct of the case). The letter on which the Appellant relies is wholly inadequate."
"Judges are often faced with late applications for adjournments by litigants in person on medical grounds. An adjournment is not simply there for the asking. While the court must recognise that litigants in person are not as used to the stresses of appearing in court as professional advocates, nevertheless something more than stress occasioned by the litigation will be needed to support an application for an adjournment. In cases where the applicant complains of stress-related illness, an adjournment is unlikely to serve any useful purpose because the stress will simply recur on an adjourned hearing."
"Finally, I consider that the Tribunal was entitled to weigh up the (inadequate) sick note against all of the other material available to them. This included not only the existing medical evidence (and the fact that the sick note was broadly consistent with that other evidence, and not contrary to it) but also the fact that [the appellant] had already made three unsuccessful applications to adjourn this hearing on entirely different grounds, each without success."
"Any adjournment causes extensive disruption and inconvenience and wastes huge amounts of costs. That would have been particularly acute here, given the number of witnesses and the length of the hearing. Those again were relevant factors which the Tribunal was entitled to consider when arriving at its conclusion."
"A litigant whose presence is needed for the fair trial of the case but who is unable to be present through no fault of his own will usually have to be granted an adjournment, however inconvenient it may be to the tribunal or court and to the other parties. That litigant's right to a fair trial under Article 6 of the European Convention on Human Rights demands nothing less. But the tribunal or court is entitled to be satisfied that the inability of the litigant to be present is genuine, and the onus is on the applicant for an adjournment to prove the need for such an adjournment."
"All must depend on the particular circumstances of the case. I make these comments in recognition of the fact that applications for an adjournment on the basis of a medical certificate may present difficult problems requiring practical solutions if justice is to be achieved."
"If the court refuses an adjournment, there will usually be a trial and a decision on the merits, although the unsuccessful applicant will be at a disadvantage, possibly a huge disadvantage, by reason of the absence of the witness or the party himself. Despite their absence and depending on the circumstances, it may still be possible for the disadvantaged claimant to prove the claim or the disadvantaged defendant to resist it. I accept that in some cases the refusal of an adjournment will almost inevitably lead to the unsuccessful applicant losing at trial. That is a factor that must be borne in mind when the court exercises its discretion in deciding whether or not to grant an adjournment. But if the application to set aside a judgment under rule 39.3(3) fails, the applicant will have had no opportunity whatsoever to have an adjudication by the court on the merits. The difference between an application under rule 39.3(3) and an application for an adjournment of the trial is important. Although it has not been articulated as the justification for generally adopting a more draconian approach to the application for an adjournment than to an application under rule 39.3(5), in my view it does justify such a distinction."
"27. ... the question of whether the litigant can or cannot participate in the hearing effectively does not always have a straightforward yes or no answer. There may be reasonable accommodations that can be made to enable effective participation. The court is familiar with the need to take this approach, in particular with vulnerable witnesses in criminal cases. A similar approach may enable a litigant in poor health to participate adequately in civil litigation. But the court needs evidence in order to assess whether this can be done or not and, if it can, how."28. ... the question of whether effective participation is possible depends not only on the medical condition of the applicant for an adjournment, but also, and perhaps critically, on the nature of the hearing, the nature of the issues before the court and what role the party concerned is called on to undertake. If the issues are straightforward and their merits have already been debated in correspondence, or on previous occasions, or both there may be little more that can be usefully be said. If the issues are more complex but the party concerned is capable, financially and otherwise, of instructing legal representatives in his or her place and of giving them adequate instructions their own ill health may be of little or no consequence. All depends on the circumstances as assessed by the court on the evidence put before it."
"73. The right to a fair trial is enshrined under the common law and Article 6. The content of procedural fairness is infinitely flexible. It is not possible to lay down rigid rules to be applied identically in every situation. Whilst there is a core minimum of process required, involving notice and some form of hearing, what is necessary to meet the requirements for a fair trial in any given case will depend on the specific facts, including for example the nature of the proceedings, the stage reached by the proceedings and the overall procedural history. So, for example, a 'fair' hearing does not necessarily mean that there must be an opportunity to be heard orally."74. The ability of a respondent to participate effectively in regulatory proceedings is a fundamental element of the right to a fair trial. It is to be assessed in the context of the particular proceedings (see for example R v Marcantonio and Chitolie [2016] EWCA Crim 14 at 7) ... The courts will interfere to protect it when necessary: see for example Anastasi v Police Appeal Tribunal [2015] EWHC 4156 at 38 and Brabazon-Drenning v UKCC [2001] HRLR 6 where Elias LJ stated at [18] and [19]:
"'Save in very exceptional cases where the public interest points strongly to the contrary, it must be wrong for a committee which has the livelihood and reputation of a professional individual in the palm of its hands to go on with a hearing where there is unchallenged medical evidence that the individual is simply not fit to withstand the rigours of the disciplinary process ... She clearly was unable to attend this hearing because she was too ill to do so. In those circumstances, I do not think there were any overriding public interest considerations which should have deprived her of her basic rights to be present when the case was put against her, and to be in a position where she could either cross-examine herself or have a representative with whom she could communicate cross-examine on her behalf. It was a breach both of the principles of natural justice and Article 6.'
"75. Equally in R (on the application of Gatawa) v Nursing and Midwifery Council [2013] EWHC 3435 (Admin) a decision not to adjourn a disciplinary hearing to allow more time for a lay representative to prepare on behalf of a nurse, who was suffering from mental illness and was absent, was held not to be have been procedurally unfair when her representative had been given many opportunities to ask for more time.
"76. Thus, refusal of an adjournment to a party unable to attend the hearing, if wrongful, may be tantamount to a denial of justice. Context is everything."
Discussion and conclusions
"Mr Craig Lummis' current mental health disorders would be significantly exacerbated by engaging in a trial at the present time, and it is highly likely that his risk of suicide will thereby increase from medium to high."
"It is absolutely clear that this matter needs to be continued, but from the clinical point of view there would be merit in some delay in proceedings."