Scottish High Court of Justiciary Decisons

DAVID WARK ARNOTT v. HER MAJESTY'S ADVOCATE [1999] ScotHC 139 (2nd June, 1999)

The appellant is David Wark Arnott who pled guilty at the High Court at Edinburgh on 26 March 1999 to a charge alleging that between 1 December 1991 and 25 June 1993, while practising as a solicitor and as a partner in Arnott, Gallacher & Company, and thereafter as Arnott & Company, he embezzled a sum of £146,000. He was sentenced to four years imprisonment and has now appealed against that sentence.

As Mr Jackson explained to us this morning, the appellant graduated in law in 1969 and then went to do Voluntary Service Overseas in Malawi after which he worked in industry. He was admitted as a solicitor in 1972 and from 1979 until 1989 he was with the firm of Ross Harper & Murphy and in particular he was a partner in their office in Kirkintilloch. That office, when he joined it, was principally concerned with commercial matters rather than with matters financed on the basis of legal aid. However, the appellant was joined there by a Mr Gallacher and together they developed the legal aid work at the office.

In about 1989 they decided to buy out the practice in Kirkintilloch and, to do so, they raised a loan of about £300,000 on a commercial basis. Therefore when the new firm began in 1989 it was burdened with this debt. Really from the outset they were seriously overstretched. To try to deal with that matter, the firm expanded in the hope of generating business and they began work in the estate agency sector. All this proved to be to no avail.

Towards the end of 1991 Mr Gallacher decided to leave the firm along with an assistant. At about that time the system of legal aid payments had changed and grants of legal aid were now made to individual solicitors rather than to firms. Mr Jackson explained that the effect was that when Mr Gallacher and his assistant left the firm they in effect took with them the cashflow associated with the legal aid work. The appellant therefore found himself in an even worse position than before. The firm had members of staff and other expenses and to try to cover these matters the appellant borrowed more and more and in effect found himself in a constant financial disaster. The firm was losing money at about the rate of £12,000 per month.

Mr Jackson did not go in to the detail of the various stages in the embezzlement which are set out in the sentencing judge's report. It is not necessary for us to give a narrative of them either. In summary what was happening was that the appellant was using clients' money in a succession of transactions to pay the bills of the firm and in effect to finance the firm. The result was that the matters got worse progressively over the period and the debt eventually built up to the sum of £146,000.

In addressing us today Mr Jackson submitted that it had been excessive for the sentencing judge to select a sentence of four years. There were, said Mr Jackson, a number of reasons why that was so. He pointed out - and this had been said also of course to the sentencing judge - that this was not a case where the solicitor concerned had used his embezzlement to fund a lavish lifestyle. There was, as Mr Jackson put it, no question of wine, women or song, nor even any question of gambling. The appellant, as a solicitor, had a reasonable house and a second-hand three-year-old car. His children went to the local school. He was simply leading a not at all lavish life. When in due course the problems emerged and a judicial factor was appointed by the Law Society in June 1993, the appellant immediately did what he could to replace funds by selling his car. Indeed, Mr Jackson's point was that from the outset, with the appointment of the judicial factor by the Law Society, the appellant co-operated in every reasonable sense. He, in particular, identified areas of the business where there would be shortfalls and the result was that by 23 June 1993 the precise amount embezzled had actually been identified by the judicial factor. This therefore was a case where, right from the very outset, the appellant had done all he could to co-operate with the Law Society and the other authorities.

This submission led on to what Mr Jackson called "the single most important factor" upon which he relied in arguing that a sentence of four years imposed in March 1999 was not appropriate.

Mr Jackson pointed out that, although the appellant had not been well for some eight weeks after the embezzlement came to light in June 1993, nonetheless, thereafter he picked himself up and began work as a taxi driver. He then took a course in computing in 1994 and 1995 at a college in Falkirk and thereafter in 1996 he went on to study at Stirling University, again doing a course in relation to computing. He had, understandably, found it hard to obtain work in the circumstances but he had, in the end, been able to find a job installing and maintaining computer systems. One result of him having been imprisoned was that his computer skills were likely to become rusty.

Mr Jackson tendered a number of references from people, some of whom had had contact with the appellant during this period, and they were generally to the effect that they had a high regard for him.

Mr Jackson said that the position therefore was that between June 1993 and March 1999 the appellant had in effect got his life back on the road. The problem was during that period there had been a very considerable delay, apparently on the part of the Crown authorities. Mr Jackson did not suggest that this was something for which they were at fault: he simply pointed out that there had in fact been a delay. The figure of the embezzlement of £146,000 had been identified by the judicial factor in June 1993, as we have explained. He had then proceeded to do a considerable amount of investigation, tracing the details of the embezzlement and in April 1995 he had informed the police that there would be a case to investigate in relation to embezzlement. The case was formally reported by the police to the Procurator Fiscal in July 1995 but the final report was not put to the Procurator Fiscal until some time in 1996. It had then been dealt with in special units in the Procurator Fiscal's office in Glasgow and in the Crown Office. It was only in October 1997 that the Crown had served a petition.

Thereafter the Crown were due to go to trial in September 1998 and had served an indictment for that purpose but shortly before that, on the motion of the defence, the period of twelve months was extended in order that they should have more time to consider the full papers in the case. Mr Jackson explained that even though the appellant had been in a position to identify the various items involved in 1993, nonetheless with the lapse of some four and a quarter years before the petition was served, it had become necessary to look into the papers again before any plea could be tendered. One was faced with a situation which was common in cases like this where there had been a very long period between the events of the crime and the matter eventually being dealt with by the Courts. In this case the appellant had made use of that time to rebuild his life and in that context it was now excessive for the judge to have chosen a sentence of four years.

The only other point which we should note is that Mr Jackson said that what had happened here could, to some extent, be regarded as having been caused by the fact that the appellant, in business by himself, had received no support from his professional body, the Law Society. Since that time the Law Society had come to recognise the problem and had a unit which could offer support to practices where they seemed likely to get into financial difficulties.

The question for us is whether the sentence chosen by the sentencing judge can be regarded as excessive. The Court has consistently taken the view that clients are entitled to expect the criminal law to do what it can to punish solicitors who abuse their trust and to deter others from doing likewise. We accept that this is not a case where the appellant was carrying on a lavish lifestyle. Nonetheless, he was propping up his business and supporting himself and his family by embezzling funds which his clients had put into his hands. As the sentencing judge explains, this was a prolonged and calculated crime of dishonesty carried out over a period of about eighteen months.

We accept that it is unfortunate that there has been the delay in bringing this matter before the Court but, even taking account of that delay and the other factors which were put forward to us in mitigation, we find it quite impossible to describe the sentence chosen by the sentencing judge as excessive. We shall accordingly refuse the appeal.