Scottish Court of Session Decisions

Danskin, Re Judicial Review [2002] ScotCS 32 (6th February, 2002)

OUTER HOUSE, COURT OF SESSION
	OPINION OF LADY COSGROVE in Petition of JULIAN STRUTHERS DANSKIN Petitioner for Judicial Review of a decision of the Council of the Law Society of Scotland to refuse an application under section 9 of the Solicitors (Scotland) Act 1980     ________________

 

 

Petitioner: Thomson; Simpson & Marwick, W.S.

Respondents: Haddow, Q.C.; McGrigor Donald

 

6 February 2002

Introduction

1. The petitioner is a solicitor and is enrolled on the roll of solicitors kept by the Council of the Law Society of Scotland, the first respondents (hereinafter referred to as "the respondents") at their office. He is aged 50 and has been an enrolled solicitor since 5 January 1976. On 1 December 1999 the petitioner was convicted at the sheriff court in Kirkcaldy of sexual offences involving males under the age of 18 years and was sentenced to a period of eighteen months' imprisonment. He was granted interim liberation on 7 December 1999 pending appeal proceedings. His appeal against conviction was refused on 4 July 2001 and the petitioner has, since that date, been a prisoner at H.M. Prison, Saughton, Edinburgh.
2. In September 2001 the respondents instituted, as complainers, disciplinary proceedings against the petitioner; they appointed the second respondent, a solicitor, as fiscal in the said proceedings. The sole ground upon which the complaint in these proceedings against the petitioner is based is the fact of his conviction on 1 December 1999 for sexual offences; there is no suggestion of any misconduct on the part of the petitioner in any way related to the carrying on of his professional practice. A power available to the disciplinary tribunal, the Scottish Solicitors' Discipline Tribunal ("the Tribunal") is to strike the petitioner off the roll of solicitors. On or about 17 October 2001 the agents acting for the petitioner wrote to the second respondent suggesting that the complaint to the Tribunal be withdrawn in the light of the fact that the petitioner had applied in terms of section 9 of the Solicitors (Scotland) Act 1980 to have his name removed from the roll. On 26 October 2001, at a meeting of the respondents, the petitioner's application in terms of section 9 was refused and the decision taken to decline to abandon the prosecution before the Tribunal. The present petition is brought to challenge the respondents' decision to refuse the section 9 application.

The statutory framework

3. In terms of section 1 of the Solicitors (Scotland) Act 1980 ("the Act") the objects of the Law Society of Scotland "shall include the promotion of -

(a) the interests of the solicitors' profession in Scotland; and

(b) the interests of the public in relation to that profession."

Section 1(3) confers a wide power and provides that the Society "may do anything that is incidental or conducive to the exercise of these functions or the attainment of those objects." In terms of section 7 the respondents shall be the registrar of solicitors and shall keep at their office a roll of solicitors ("the roll"). Section 9 provides for the removal of a name from the roll on request and is in the following terms:

"9. An enrolled solicitor who wishes his name,..... to be removed from the roll of solicitors may make an application to the Council in that behalf, and the Council shall on the solicitor satisfying the Council that he has made adequate arrangements with respect to the business he has then in hand, remove the name of that solicitor..... from the roll."

4. In terms of section 10(1A) the Council may, after such enquiry as they think proper, restore to the roll the name of any solicitor which has been removed from the roll under section 9. In terms of section 10(1) a solicitor whose name has been struck off the roll is also entitled to make application to have it restored, but in that situation the application requires to be made to the Tribunal which is entitled to make such enquiry as it considers proper before so ordering.
5. Section 53 of the Act provides that the Tribunal may, if it is satisfied after holding an inquiry into a complaint against a solicitor that he has been guilty of professional misconduct, order that his name be struck off the roll, or impose one of a list of other sanctions. In terms of section 53(3A) the penalties of fine and censure may be exercised by the Tribunal in relation to a former solicitor, notwithstanding that his name has been struck off the roll or that he has ceased to practice as a solicitor or been suspended from practice.

The undisputed facts

6. By letter dated 15 October 2001 the solicitor acting on behalf of the petitioner wrote to the respondents' secretary enclosing the petitioner's application under section 9 of the Act to have his name removed from the roll of solicitors. The said letter intimated that, in terms of a Minute of Dissolution of Partnership entered into between the petitioner and his former partner, Cameron Hunter Mackenzie, solicitor, the practice formerly carried on by them is, with effect from 31 August 2001, carried on solely by Mr Mackenzie. Adequate arrangements are said to be in place for the discharge of all of the business of the firm in hand as at the date of dissolution of the partnership. Reference is also made in that letter to the fact that the respondents' Chief Accountant has been advised of the circumstances in relation to the petitioner's former practice and that he has indicated that he "considers that adequate arrangements have been made for the continuation of the practice." A request is made of the respondents' secretary to advise the petitioner's solicitor "if any further information is required to satisfy the requirements of section 9".
7. The respondents' decision taken at their meeting on 26 October 2001 to refuse the petitioner's application in terms of section 9 was intimated to him by letter of 30 October 2001. That letter was in the following terms:

"I write to inform you on behalf of the Council of the Law Society of Scotland that your application of 15 October in terms of section 9 of the Solicitors (Scotland) Act 1980 to have your name removed from the Roll of Solicitors, was refused. Council are not at this stage satisfied with the arrangements for the dissolution of the practice of Messrs Smith & Grant, Leven."

The nine submissions for the petitioner:

8. (1) That by considering the public relations consequences of refusing or granting the section 9 application the respondents took into account an irrelevant consideration.
9. The petitioner avers that neither he nor his solicitor was present at the respondents' meeting but lists a number of individuals from whom he says that information as to what occurred there was received. On the basis of that information, the petitioner avers that the respondents decided to refuse the application to allow his name to be removed from the roll "because they took the view that to do so 'would be a public relations disaster'". The argument presented on behalf of the petitioner was to the effect that by considering the public relations consequences of refusing or granting the application, the respondents took into account an irrelevant consideration.
10. The respondents' position was that whatever might have been said about this matter at their meeting, it was not accepted that it was the reason for the decision. Both counsel were agreed, however, that a decision as to the question which is raised in this ground, namely, whether or not public relations considerations played any part in the decision-making process, could only be made following an inquiry into the facts by way of proof as to precisely what was said in this regard and in what context. I agree with that approach and express no view on this ground at this stage.
11. (2) In taking into account the lack of a recent inspection by guarantee fund officers, the Council had regard to an irrelevant consideration.
12. The petitioner avers that, notwithstanding that the respondents were informed by their Chief Accountant at their meeting on 26 October, that he was satisfied with the arrangements which had been made with respect to the business of the petitioner's former firm, they continued to question him until they ascertained that there had been no recent inspection by the guarantee fund officials of the firm's books of account.
13. In their Answers to the Petition the respondents aver that enquiries made of the Chief Accountant at the meeting disclosed that in expressing any view as to the adequacy of the arrangements proposed by the petitioner he was proceeding solely on oral assurances made by the petitioner's agents. The respondents took, and were entitled to take, the view that more direct examination of what arrangements were being put in place by way of legal documentation and supporting practical mechanisms for the conduct of the business should be made by the Chief Accountant. They go on to explain that inspections for guarantee fund purposes are made both on a regular and on a random basis of the books of account of solicitors' firms; the purpose of these inspections is to check that books and records are in order and that there have been no defalcations which might give rise to claims on the Guarantee Fund; such inspections also reveal the state and adequacy of records and the solicitors' compliance with the rules of the profession as to the conduct of books and also of proper accounting practice. The respondents aver, in particular, that had there been a recent guarantee fund inspection of the petitioner's business, there would, on 26 October 2001, have been available to the respondents recent first-hand evidence of whether the records of the business were in proper order. Since there had been no such recent inspection, that possible source of information was not available to them and the respondents accordingly made the decision they did.
14. Mr Thomson, who appeared for the petitioner, submitted that the statutory test was clear in its terms: all that the Council require to be satisfied of is that adequate arrangements have been made with respect to the business the applicant then has in hand; the language of the section imposes no obligation on the applicant to vouch all his past financial dealings to establish that there had been no past impropriety. The respondents had accordingly erred in their approach.
15. Mr Haddow, Q.C. for the respondents submitted that it was not wrong for the Council to allow the absence of a recent inspection and up-to-date information to weigh with them. While it was true to say that section 9 is, in essence, concerned with a matter other than the financial aspect of the firms' business, a guarantee fund inspection could nevertheless produce information relevant to the question as to whether the Council was satisfied with the arrangements made.
16. I consider that the argument for the petitioner is well-founded in this regard. Section 9 is clear in its terms: all that the solicitor requires to do is to satisfy the Council that he has made adequate arrangements with respect to the business he has then in hand. It seems to me that the purpose of this provision is to ensure that any current client is not left in the lurch without legal representation. All the information the respondents aver that they required to obtain relates to the past conduct of the petitioner's firm. I do not read the section as bringing within the ambit of the Council's attention any such matter.
17. I am confirmed in that view by consideration of the provisions of section 42A of the Act. That provides remedies against the solicitor who has provided inadequate professional services. In terms of that section, any aggrieved client having a complaint against the solicitor in respect of the professional services provided by him may bring that complaint to the respondents; "solicitor" is defined for the purposes of the section as "any solicitor, whether or not he had a practising certificate in force at the time of the provision of the professional services which are alleged to be inadequate, and notwithstanding that subsequent to that time he has had his name removed from or struck off the roll." It follows that the rights of any former clients against the petitioner in respect of complaints about professional services rendered by him would be unaffected by removal of his name from the roll.
18. It follows from what has been said that the respondents have, in my view, erred in their decision-making process by taking into account an irrelevant consideration.
19. (3) The decision letter demonstrates that the respondents erred in law by applying the wrong test.
20. The terms of the decision letter of 30 October 2001, to which reference has already been made, indicate that the petitioner's application has been refused because the Council are not satisfied with the arrangements for the dissolution of the practice of his former firm. It was submitted on his behalf that the Council required to be satisfied only as to the adequacy of the arrangements with respect to the business the petitioner then had in hand and not with the whole arrangements for the dissolution of the practice. That they had in fact taken into consideration wider issues was evidenced by the emphasis which had been placed by them on the absence of any recent inspection by guarantee fund officials.
21. I consider that comparison of the terms of the decision letter with those of the provisions of section 9 leads to the conclusion that an inconsistency between, on the one hand, what was required of the respondents and, on the other, what they took upon themselves, has indeed been demonstrated. That view is supported by reference to the material which the respondents aver in Answer 10 was required.
22. It follows from what has been said that I consider that this submission on behalf of the petitioner should also be upheld.
23. (4) The guarantee fund officials' inspection was, in the particular circumstances, an irrelevant consideration.
24. Mr Thomson's submission in this regard was that the guarantee fund inspection was not only irrelevant per se but was irrelevant in the absence of any suggestion whatsoever of financial impropriety on the part of the petitioner whose appearance before the Tribunal was related to professional misconduct by virtue only of his criminal conduct. No suggestion of any breach of the accounts rules or of any pecuniary loss to any individual had arisen; in these circumstances there was no reason to require any inspection by guarantee fund officials of the firm's books of account.
25. In upholding this argument I observe that it is apparent from the terms of section 45(2) of the Act that, even in the case of the solicitor who has been struck off or suspended, there appears to be no requirement for an audit of his accounts. The effect of the respondents' approach would be to impose a more stringent requirement on the solicitor who presents an application in terms of section 9.
26. (5) The respondents' position in their answers demonstrates that by holding themselves dissatisfied with the quality of the information which was supplied to them, they took into account an irrelevant matter, et separatim, acted with procedural unfairness, et separatim, deprived the petitioner of a legitimate expectation.
27. The respondents indicate in their answers that the Chief Accountant was proceeding solely on assurances made by the petitioner's agent and that they were entitled to take the view that more direct examination of what arrangements were being put in place by way of legal documentation and supporting practical mechanisms for the conduct of the business should be made by the Chief Accountant.
28. Mr Thomson referred in this connection to the fact that there has never, at any stage, been any suggestion by the respondents of any basis for doubting the information that was provided by the applicant's solicitor. The fact that the Chief Accountant had indicated that he considered that adequate arrangements had been made for the continuation of the petitioner's practice was communicated by the petitioner's solicitor to the respondents' secretary by letter dated 15 October 2001. The veracity of the representation by the petitioner's agent was not challenged either by the Chief Accountant or by the respondents. The Chief Accountant did not seek any independent verification of the information provided, nor did he seek to make his own enquiries. What the respondents then did was to found on the separate issue of the absence of a guarantee fund inspection.
29. Mr Thomson submitted further that, in the absence of any suggestion of financial impropriety on the part of the petitioner, the respondents had no reason to doubt the material which was supplied to them and it was accordingly irrational for them to reject it. Further, the respondents' refusal of the application on the basis that they were not satisfied with the quality of the information provided was, in the absence of any intimation that any further information was required, not only a breach of the requirement of fairness and contrary to natural justice but also a denial of the petitioner's legitimate expectations.
30. In response, Mr Haddow refuted the suggestion that the respondents had taken into consideration an irrelevant matter: they were entitled to determine how much reliance ought to be placed on the information supplied. Nor had there been any procedural unfairness in view of the possibility open to the petitioner of submitting a fresh application under section 9.
31. Mr Haddow admitted, however, to what he described as a "slight discomfort" concerning the respondents' decision to refuse the petitioner's application, rather than continue or defer it for further enquiry before reaching a decision. However, in the absence of any suggestion of prejudice, this argument against the respondents was said to be without foundation. In the event of the petitioner submitting a further section 9 application, he would be assisted by the information in the refusal letter and the information that the Council have, since the hearing on 26 October, made further enquiries and would now not be able to state that they were not satisfied with regard to the application. Further, in the absence of any indication by the Council that they would be satisfied in certain specified circumstances or, that if they were not satisfied, they would continue the matter for further enquiry, no question arose of any legitimate expectation on the part of the petitioner.
32. The decision of the respondents which is challenged in these proceedings is a decision to refuse the petitioner's application. In his letter of 15 October the petitioner's solicitor asked to be advised if any further information was needed to satisfy the requirements of section 9. The respondents gave no indication whatsoever in their response acknowledging receipt of the petitioner's application that any further information would be required. Having regard to the language of section 9 there was no reason in the circumstances for the petitioner to suspect that further information of the type to which reference is made in the Answers would be required. It is difficult, in these circumstances, to avoid the conclusion that there has been a breach of the requirement of fairness by the respondents.
33. (6) Esto, the issue of the guarantee fund officials' inspection was a relevant matter, the Council failed to take into account other material matters.
34. The particular facts which it is averred the respondents failed to take into account, as set out in the Petition, are that their own accountants assisted in providing certification that the petitioner's firm had complied with the accounts rules and that there was no suggestion of financial impropriety in relation to the petitioner nor any suggestion of pecuniary loss to any person.
35. Mr Haddow submitted that the petitioner's averments in this regard demonstrate a misunderstanding of the benefit to the respondents of there having been a recent guarantee fund inspection; such an inspection would be relevant not only to discovery of any financial impropriety, but also to the question of the general conduct of the business of the petitioner's firm.
36. I have already indicated that I have reached the view that the absence of an inspection was not a material consideration and ought not to have been taken into account by the respondents in reaching their decision.
37. (7) The Council erred in law by holding that they had a discretion to refuse to grant the petitioner's application.
38. It is averred in the petition that the respondents' secretary advised the petitioner's agents that they had, as part of their decision, taken the view that the terms of section 9 were not mandatory and that the Council, even if satisfied as to the arrangements made, could nonetheless refuse to allow the applicant's name to be removed from the roll of solicitors.
39. Mr Thomson's submission in this regard was that it was plain from the terms of section 9 that no discretion whatsoever was conferred on the respondents. If the petitioner wished to have his name removed from the roll there was no reason in principle why he should not be allowed to do so. It was still open to the Council to institute or carry on with its disciplinary proceedings against him. The statute conferred a right on any petitioner to have his name removed; while a discretion is conferred on the respondents as to who should be admitted as a member of the profession, no similar discretion was available to them to prevent a practitioner leaving the profession. It was wrong to regard what the petitioner sought as avoidance. All the sanctions available to the Tribunal remain, even if his name is removed from the roll.
40. In response, Mr Haddow submitted that the petitioner could only succeed in this respect if he could establish that the Council is bound to grant a section 9 application instantly on being satisfied of the matter specified therein. It was submitted that that was not the case. The vital question which arose was when was the petitioner entitled to have his name removed. There was nothing in the terms of section 9 to imply what was described as "rubber-stamp immediacy" and it would therefore be open to the respondents to defer or to continue an application to another date. The entitlement could be no more than to have the name removed within a reasonable time. It followed from the fact that the Council met on a monthly basis that there would be different time lapses between the making and granting of applications, depending upon the timing of the lodging of the particular application. The question thus came to be what fell within the range of considerations which could reasonably permit the respondents to defer removing an applicant's name. It could not be said, it was argued, that the petitioner had a right to have his name removed before the Tribunal considers his case. It was clear that he was trying to avoid being struck off and unless he could demonstrate an error on the part of the respondents, he could not expect to achieve that. The respondents' position was as set out in Article 18 of their Answers to the Petition where it is averred that it is detrimental to the solicitors' profession in Scotland for a person appearing before the Tribunal to be allowed to avoid one of the limited range of sanctions by insisting on having his name removed from the roll before he appears before the Tribunal.
41. Section 9 is, in my view, entirely clear and unambiguous in its terms: the Council "shall" remove the name of the solicitor on being satisfied by him that he has made adequate arrangements with respect to the business he has then in hand. As has already been observed, however, a wide power is conferred on the respondents in terms of section 1(3) of the Act to do "anything that is incidental or conducive to" the exercise of their functions or the attainment of their objects and these include the promotion of the interests of the profession in Scotland and of the public in relation to that profession. It follows, in my view, that had the respondents decided to defer or continue consideration of the petitioner's application to a specified date - the Tribunal hearing was due to take place on 9 December 2001 - any challenge to that decision may well have been difficult to maintain. There is nothing in the language of section 9 to require the respondents to remove an applicant's name forthwith or on any specified date. But what the respondents did in this case was to refuse the petitioner's application and that was something they were not in law entitled to do except in the event of not being satisfied as to the one limited matter specified in the section. It follows, therefore, that the respondents erred in law in the making of their decision.
42. (8) The respondents reached a decision which no reasonable council, properly directing itself in law and acting in good faith, could have reached.
43. The argument presented in this respect was that the Council, having only one limited matter about which they required to be satisfied, were presented with information the veracity and accuracy of which they had no reason to doubt, and having not sought any further information, the decision to refuse was unreasonable. Further, the decision was said to be irrational because there was no material before the respondents suggesting other than that adequate arrangements had been made in respect of the business which the petitioner then had in hand. I consider that this argument is, in effect, an amalgam and restatement of issues already raised and I do not consider it necessary to express any separate opinion on it.
44. (9) The respondents failed to give adequate reasons for their decision.
45. Mr Thomson indicated that he did not place much reliance on this argument at this stage since the question as to the accuracy of the reason was probably dependent upon the outcome of any proof that was required as to what occurred at the respondents' meeting. It is thus unnecessary for me to reach a view about this matter.

The result

46. In terms of paragraph 3(a) of the petition the petitioner seeks reduction of the said decision of the respondents of 26 October 2001 and of the letter intimating the said decision. In the light of the view I have reached in respect of the arguments presented on his behalf, the effect of which is that I hold that the respondents, in reaching their decision, took into account an irrelevant consideration and erred in law by applying the wrong test, it follows that the petitioner is entitled to this remedy.
47. In terms of paragraph 3(b) of the petition the petitioner seeks an order requiring the first respondents, in terms of section 9 of the said Act, to remove the petitioner's name from the roll of solicitors kept by them. Mr Thomson submitted that the word "forthwith" should be added with a view to achieving this result prior to the hearing by the Tribunal which is due to take place on 29 January 2002. Alternatively, it was suggested that the court should grant the order sought rather than remit the matter back to the respondents. Mr Haddow submitted that an order requiring the respondents to remove the petitioner's name from the roll forthwith deprived them of the opportunity of considering whether, under the very general powers which they enjoy, they could defer consideration of the application until after the Tribunal hearing had taken place. In the event, both counsel agreed that if I found in favour of the petitioner and granted reduction of the respondents' decision and of the letter intimating it, the matter should then be put out By Order for further discussion as to future procedure. I will accordingly appoint this case to the By Order roll for that purpose. The interim orders previously granted will remain in force until then.