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Cite as: [2005] EWHC 2023 (Admin)

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Neutral Citation Number: [2005] EWHC 2023 (Admin)
CO/1112/2004

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
DIVISIONAL COURT

Royal Courts of Justice
Strand
London WC2
26th July 2005

B e f o r e :

LADY JUSTICE SMITH DBE
MR JUSTICE SIMON
MR JUSTICE McCOMBE

____________________

DAVID HERMAN HOLDER (CLAIMANT)
-v-
THE LAW SOCIETY (DEFENDANT)

____________________

Computer-Aided Transcript of the Stenograph Notes of
Smith Bernal Wordwave Limited
190 Fleet Street London EC4A 2AG
Tel No: 020 7404 1400 Fax No: 020 7831 8838
(Official Shorthand Writers to the Court)

____________________

MR P ENGELMAN appeared on behalf of the CLAIMANT
MR MILLER appeared on behalf of the DEFENDANT

____________________

HTML VERSION OF JUDGMENT
____________________

Crown Copyright ©

    Tuesday, 26th July 2005

  1. MR JUSTICE McCOMBE: This is an appeal brought by Mr David Herman Holder against a decision and order of the Solicitors' Disciplinary Tribunal made on 13th January 2004, as amplified by detailed findings dated 17th February 2004. By its order, the Tribunal directed that Mr Holder should be struck off the Roll of Solicitors and ordered that he do pay the costs of and incidental to the application which the Tribunal assessed.
  2. Before the Tribunal, the charges preferred against Mr Holder were as follows: that he had (a) dishonestly utilised clients' money for his own purposes, (b) acted in breach of the Solicitors' Accounts Rules 1991 in that contrary to the provisions of Rule 7 and 8 of the said Rules (Rule 22 of the Solicitors' Accounts Rules 1998) he has drawn from client account monies other than in accordance with the said Rules and utilised the same for his own benefit, (c) he had been guilty of conduct unbefitting a solicitor. After the hearing on 13th January, the Tribunal found the allegations proved and, accordingly, made the order that I have indicated.
  3. On the present appeal, Mr Engelman, who appeared for Mr Holder, argued five points:
  4. (1) that the Tribunal wrongly refused to adjourn the hearing of 13th January 2004;

    (2) that the Tribunal is not a sufficiently independent and impartial one for the purposes of the Common Law or Article 6 of the European Convention of Human Rights;

    (3) the admission before the Tribunal of evidence derived from the Law Society's Inspector and Mr Holder's admissions to that Inspector offended against the privilege against self-incrimination and the rules derived from the European Convention relating to the use of materials emanating from the exercise of compulsory powers (see the case of Saunders v United Kingdom 23 EHRR 313);

    (4) that the Tribunal's finding of dishonesty against Mr Holder was unjustified on the evidence;

    (5) if that be so, the penalty imposed was excessive.

  5. The background to the matter was as follows. The appellant, Mr Holder, had been admitted as a solicitor on 1st December 1994. In November of 1996 he had entered into partnership with a Mr John Baskin and they practised together under the style of Baskin and Co from premises in London. In August 2000 Mr Baskin became a consultant to the firm and, thereafter, the appellant, Mr Holder, remained as sole principal.
  6. On 8th June 2001 the Inspector to which I have referred, a Mr Becconsall, commenced an inspection of the appellant's books of account and other documents pursuant to the Solicitors' Accounts Rules and Solicitors' Practice Rules. According to Mr Becconsall's work, the inspection revealed a minimum cash shortage on client account of in excess of 200,000; that the appellant had withdrawn money from client account for his own purposes to reduce liabilities to money lenders; that he was substantially in debt to such money lenders in a sum a little short of 500,000, he had debts of 680,000, excluding client account liability, creditors including professional indemnity insurers, the Commissioners of Customs and Excise for VAT, the Inland Revenue for PAYE, and other liabilities; that the appellant had not maintained any client account records since March 2000 and that he was not able to produce certain bank account statements or paying-in books. Mr Becconsall so reported to the Law Society on 14th June 2001. On the 15th of that month, the Compliance and Supervision Committee of the Office for the Supervision of Solicitors resolved that disciplinary proceedings should be instituted against the appellant and that the statutory powers of intervention should be exercised on the grounds of suspected dishonesty.
  7. The intervention proceedings and the disciplinary proceedings ran essentially in parallel. Mr Holder challenged the legality of the intervention in the High Court. The chronology is of materiality in relation to the application for adjournment that was made to the Tribunal.
  8. Accordingly, the intervention chronology was this. The Intervention Notice was served by the Law Society on the appellant on 18th June 2001. On 26th June Mr Holder applied to the High Court for an order requiring the Society to withdraw the Notice of Intervention. On 2nd August the Law Society responded with an application for an order to dismiss the appellant's application on summary grounds, which was acceded to by the Master on 30th August of that year. On 13th September 2001 the appellant appealed against that order. On 25th July 2002 that appeal was heard by Peter Smith J. The appeal was allowed on limited grounds, but it was held that there should be a trial to consider whether the intervention had infringed certain rights of the appellant under the First Protocol to the Human Rights Convention. On 23rd January 2003 the Law Society's appeal to the Court of Appeal against Peter Smith J's order was heard and was allowed. In effect, the Master's order dismissing Mr Holder's challenge to the intervention was restored.
  9. It is to be remembered that intervention began in June of 2001. In the disciplinary proceedings, application to the Disciplinary Tribunal was submitted on 11th September 2001. A preliminary listing was arranged for 2nd November 2001, adjourned firstly to 7th December and again to 8th February 2002, first for the appellant to be personally served with the application and to have proper time to consider his response. On 14th January 2002 the appellant was personally served with the application. On 2nd April of that year he wrote to the Tribunal, asking for the pre-listing to be further adjourned until 3rd July, due to his involvement, in part, in the proceedings challenging the intervention. As a result, the Tribunal fixed a further hearing for 10th September 2002 and notified Mr Holder accordingly. On 9th September 2002 the appellant sent a letter to the Tribunal by fax, asking that the hearing be adjourned again on the ground of his continued involvement in the intervention matter. On 9th September the appellant also contacted the applicant, namely the Law Society, making the same application.
  10. On the following day, the Tribunal heard and determined an adjournment application, it being made on two grounds, namely, first, the appellant's involvement in the intervention proceedings, and secondly, in criminal proceedings, arising broadly out of the same facts that had given rise to the Law Society's involvement. The adjournment was allowed in the event until the conclusion of the criminal proceedings. It appears that a criminal trial was initially scheduled to take place on 4th November 2002. That fixture was broken and was rescheduled for mention on 13th February 2003 at the Crown Court at Southwark and a trial date of 16th June 2003 was set. On 4th April 2003 the Tribunal allocated a new hearing date, which was 16th September, taking the criminal trial date into account. On 8th April the appellant's solicitors informed the Tribunal that the trial in the criminal matter had been rescheduled again for 8th September, thus clashing with the new date that had been fixed for the Tribunal hearing. On 24th April of that year the Tribunal accordingly fixed a new date for the Tribunal hearing of 30th October 2003, and so notified the parties. It appears that in the end, on 13th October 2003, the criminal proceedings were disposed of when Mr Holder was acquitted on all the criminal charges that had been brought against him.
  11. On the 29th October, with the Tribunal hearing pending on the following day, the appellant, Mr Holder, wrote to the Tribunal in the following terms, and I quote only part of the relevant letter:
  12. "I understand there may be a hearing tomorrow, although I do not know whether this is a listing appointment nor do I know what time. It all appears rather vague. Having now completed my criminal trial, which has lasted over 2 and a half years, I am now in the process of instructing solicitors and counsel in connection with the disciplinary hearing.
    Furthermore, I have to appear as a witness on behalf of a claimant in Barnet County Court tomorrow, which may last most of the day, and in those circumstances I would be obliged if you would excuse my non attendance for the appointment. In any event I do not even know what time I am supposed to attend."

  13. Then importantly:
  14. "I would therefore be obliged if you would kindly list this matter to the first open date after 20th December 2003, by which time I should be prepared for the hearing, having by then instructed solicitors. I would also be obliged if you would avoid Friday afternoons, on religious grounds."
  15. That application for an adjournment was considered by the Tribunal on 30th October 2003. An adjournment was accordingly granted and the hearing was refixed for 13th January 2004 when, in the end, as I have related, the Tribunal reached its decision in this case.
  16. When the matter came on before the Tribunal, Mr Holder made a further application for an adjournment. His argument was that he needed time to come to terms with his situation following the criminal trial and had been trying, unsuccessfully, to get legal advice. He said that he was not ready to proceed. He said the disciplinary proceedings were tied up with the criminal allegations and that the solicitors acting in those criminal proceedings still had his papers for the purposes of dealing with the question of their costs in those proceedings. He said he required a further six to eight weeks to be prepared for the hearing. The Tribunal's decision on that application was as follows:
  17. "The date fixed for the substantive hearing has been fixed almost three months previously and had been fixed in accordance with the Respondent's written request. The Tribunal would grant adjournments only when it was just to do so. The Tribunal has a duty both to the public and the solicitors' profession to deal with disciplinary proceedings timeously.
    The Tribunal was not impressed with the Respondent's claim not to have any papers. The Tribunal did not believe that the original papers served upon the Respondent were with his solicitor's draftsman as those papers were unrelated to the criminal proceedings and the Respondent himself had confirmed that his solicitors had not been instructed in connection with the disciplinary proceedings. Even if the documents had been with the costs draftsman the Respondent could have gained access to them or could have obtained a copy or, indeed, he could have obtained a copy from the Applicant or from the Tribunal itself.
    The Tribunal recognises that an impecunious solicitor might well find difficulty in obtaining representation. The Tribunal regretted that it was not in a position to assist any solicitor Respondent (or any Applicant for that matter) with his funding difficulties.
    The Tribunal considered that the Respondent's application for an adjournment was without merit. He had had plenty of time to get his case in order. The Tribunal would however adjourn the matter from 11.45 am until 2.00 pm to make sure that the Respondent had a complete set of papers in his hands and had had an opportunity to prepare himself for the hearing."
  18. At two o'clock, when the substantive hearing was called on, Mr Holder made three submissions:
  19. (1) He referred to his limited means compared with that of the Law Society and argued that therefore this feature amounted to an impermissible "inequality of arms" in the proceedings, contrary to Article 6 of the Convention.

    (2) The Tribunal had a 98% conviction rate and merely rubber-stamped the Law Society's decisions.

    (3) He questioned whether the proceedings were properly to be regarded as civil or criminal. The following submission as a result is not recorded.

  20. The Tribunal rejected any suggestion that the points raised were a bar to its proceeding to deal with the matter. The Tribunal heard the evidence which included the report of the Law Society's investigator, which I have already mentioned, which identified substantial deficiencies in Mr Holder's client account and his accounting records. As I have indicated, the Inspector concluded, importantly, that there was a minimum shortage on client account of some 200,000. The report, dated 14th June 2001, also identified several admissions made by the appellant which are helpfully summarised in Mr Engelman's skeleton argument on behalf of Mr Holder. I do not propose to set them all out, but a flavour of them can be gathered from that document. For example, first, it appears that Mr Holder admitted he did not know the client numbers and details of client bank accounts; secondly, he had not maintained any client account records since 31st March 2000; thirdly, he was unable to provide certain client account bank statements; fourthly, there was a minimum client account shortage of 200,950 in relation to two clients. There are 18 such admissions identified in Mr Engelman's helpful skeleton argument of that and similar nature.
  21. That is the background of the present appeal. As already indicated above, Mr Engelman on behalf of Mr Holder now pursues this appeal under five heads of argument:
  22. (1) Was the Tribunal wrong to refuse the adjournment for which Mr Holder had applied?

    (2) The independence or otherwise of the Tribunal;

    (3) The privilege against self-incrimination point;

    (4) The Tribunal's finding of dishonesty against Mr Holder;

    (5) The penalty imposed.

  23. I take these points in turn.
  24. (1) Adjournment

  25. The history of the proceedings already set out demonstrates to my mind that the matters giving rise to the disciplinary proceedings went back already to June 2001 when the Law Society's Inspector investigated the state of Mr Holder's accounts. He had made his report on 14th June 2001 and the application to the Tribunal had been made on 11th September 2001. There were parallel decisions by the Society to intervene in Mr Holder's practice. That intervention was the subject of proceedings in this court and in the Court of Appeal, as I have summarised above. All stem from the same material. There were further criminal proceedings, which ended with Mr Holder's acquittal in the Crown Court in October 2003 in the manner which I have related.
  26. On 29th October 2003 when the Tribunal hearing was listed for the following day, Mr Holder wrote, applying for an adjournment, in the terms I have already set out. Importantly, the letter asked for the hearing to be listed on the first open date after 20th December 2003. That request was acceded to and the matter was listed for 13th January 2004. That was three months after the end of the criminal trial and two-and-a-half months after the grant of the adjournment. Mr Holder had been well familiar with the nature of the allegations made for well over two years. I have set out above the Tribunal's reasons for refusing yet another adjournment. Those reasons are, to my mind, cogent and entirely persuasive. The grant or refusal of an adjournment was a matter for the Tribunal's discretion. As that was a discretionary matter, this court could not interfere with it unless we could see some error in principle in that decision. I can detect no such error. Indeed, for the reasons given by it, I consider that the Tribunal was correct in its decision on that point.
  27. (2) Independence

  28. Mr Engelman next submitted that the Tribunal could not be seen to be sufficiently independent and impartial so as to satisfy the requirements of Article 6 of the European Convention on Human Rights. It is submitted that following the decision of the High Court of Justiciary in Scotland in the case of Starrs and another v Procurator Fiscal, Linlithgow [2000] HRLR 191 concerning holders of temporary judicial office, certain criteria ensuring the independence of a tribunal have to be satisfied before the requirements of Article 6 are met. It is pointed out that following that case arrangements for part-time judiciary have been altered to provide for minimum terms of office, automatic renewal of office in absence of specific grounds for not doing so, removal from office only on specific grounds, and, so far as practicable, a minimum number of court days that each office holder is to serve in each year. Mr Engelman submits that not sufficient is known as to the appointment, tenure of office, grounds for removal and the like, so as to ensure that the arrangements governing this Tribunal complies with Article 6, as explained in the Starrs case.
  29. Before us, there was material to show that the members of the Tribunal are appointed by the Master of the Rolls. There is an open and transparent system of selection of members, after advertisement, sifting of written applications and interview. The process is administered by the Tribunal with an overseer to represent the Master of the Rolls. The solicitor members serve without remuneration. All received reimbursement of their expenses. The Law Society has no hand in the appointment system and members of the Society's Council are not eligible to serve. Removal from office of any Tribunal member would be a matter for the Master of the Rolls.
  30. Since the hearing before us, the court has been provided with certain further written material emanating from the Tribunal, for which I know all members of this court are grateful. Those materials do not require me to add any more to what I have said above about the arrangements for appointment.
  31. The question of the independence of any particular tribunal will be decided by many different criteria, which will vary with the circumstances of each individual body. However, it appears to me to be tolerably clear that the factor which gave rise to the criticism of the old practices concerning part-time judicial office holders, as considered in the Starrs case, was the insecurity of office of such persons and the potential for a perception that their continuing in office could be linked to the career development of the individual office holder.
  32. In the case of members of the Solicitors' Disciplinary Tribunal, the evidence does not reveal to me any potential for a link between membership of the Tribunal and the career development of any individual member. Their work on the Tribunal is in no manner linked to their professional practices in the case of the solicitor members. In the case of the lay members such link is still less perceptible. I do not accept the suggestion made by Mr Engelman that the position as a lay member of the Tribunal can be impugned because it may carry with it some benefit of status within society at large from the fact of membership alone. Thus, there might be a perceived temptation, it was submitted, on the part of such a member not to "step out of line" in the decision-making process. With respect to Mr Engelman's careful argument in this and every other respect, I consider the objection to be fanciful rather than real.
  33. I would add that in an earlier decision of this court in Pine v Law Society made on 13th December 2000, it was held that there was no doubting the Tribunal's independence and impartiality. Giving first the judgment of the court, Crane J said this:
  34. "23. Standing back, and bearing in mind the statutory scheme for the Disciplinary Tribunal, I see no reason to doubt its independence or impartiality. It is independent of the Law Society. There is no indication that the Law Society can influence its decisions, except in the sense of making submissions to the Tribunal as a party before the Tribunal. No evidence or suggestion has been made that the particular Tribunal demonstrated any partiality in any way. In my judgment, the submission that the Solicitors Disciplinary Tribunal does not meet the test of being an independent and impartial tribunal is not made out. I turn to the question of legal representation, which is the appellant's main point. Returning to Article 6, he accepts, and authority confirms, that what was in question here was the determination of his civil rights and obligations, not of any criminal charge against him. It follows, therefore, that Article 6(3), which requires in certain circumstances legal representation in criminal cases, does not apply."

  35. With that judgment, the Lord Chief Justice and Rafferty J agreed there was no challenge to that aspect of the decision on the subsequent appeal to the Court of Appeal, reported at 2001 EWCA Civ 1574, when the solicitor affected, who had previously acted in person, was represented by leading counsel, well-versed in the law of Human Rights. The decision in Starrs in fact ante-dated (11th November 1999) rather than post-dated the Pine case, rather than the other way round, as was assumed in argument before us.
  36. In my view, taking into account all the circumstances, the nature of the Tribunal is entirely adequately independent and impartial for the purposes for which it is constituted. The reasonable by-stander, properly informed of the facts, could not consider otherwise. One might ask rhetorically, what more could be done in practice to ensure the independence of a domestic disciplinary tribunal such as this. The appointment and removal process is conducted under the auspices of a senior judicial officer. The Law Society does not and could not influence it. There is no link, actual or perceptible, between membership of the Tribunal and the career structure of any individual member. The objections identified in the Starrs case do not apply, in my view, to either the constitution or the operation of this Tribunal.
  37. (3) Privilege against self-incrimination

  38. Mr Engelman argues that in this case Mr Holder's rights under Article 6 of the Convention were also infringed in that an important part of the evidence against him before the Tribunal derived from material obtained from the exercise of the Law Society's statutory powers of investigation into the practices of solicitors. Mr Holder was compelled by the rules affecting solicitors to produce documents and accounts to the Law Society's representative and was required to supply information to that representative. The exercise of those powers led Mr Holder to make certain admissions, examples of which have already been given, which later became evidence before the Tribunal.
  39. Mr Engelman submits that that process infringed the principles set out in the decision of the European Court of Human Rights in Saunders [1996] HRLR 313. As is well-known in Saunders, in the prosecution of a defendant in criminal proceedings, the Crown had deployed in evidence material obtained in answer by the defendant to questions posed by the Inspectors appointed by the Secretary of State for Trade, pursuant to compulsory powers to be found in the Companies Acts. It was held that that process was incompatible with the defendant's rights to a fair trial under Article 6.
  40. Following that decision, Parliament revised the law relating to these and certain similar statutory provisions so as to preclude the deployment of such material by the Crown in criminal proceedings, subject to certain exceptions (see the Youth Justice and Criminal Evidence Act 1999, section 59 and schedule 3, commented on in Blackstone's Criminal Practice 2005 pages 2299 and following).
  41. Mr Engelman's submission was that the deployment before the Tribunal of the material obtained from Mr Holder pursuant to or in the context of the Law Society's compulsive powers of investigation suffers from the same objection as the use of the material in a criminal trial. First of all, it is to be noted that no attempt was, in fact, made to deploy any of this material in the criminal proceedings against Mr Holder. Thus, the traditional Common Law privilege against self-incrimination was not infringed. That privilege was defined in a passage, helpfully quoted by Mr Engelman in his skeleton argument before us, in the decision of the Court of Appeal, and the judgment of Goddard LJ in particular, in Blunt v Park Lane Hotel Ltd [1942] 2 KB 253 at page 257 in the following terms:
  42. "The rule is that no one is bound to answer any questions if the answer thereto would, in the opinion of the judge, have a tendency to expose the defendant to any criminal charge, penalty or forfeiture which the judge regards as reasonably likely to be incurred."
  43. The parallel right under the European jurisprudence was characterised by the European Court of Human Rights in the following terms in the Saunders case. I gratefully adopt the passage quoted by Mr Engelman in his argument in the following terms:
  44. "68. The Court recalls that, although not specifically mentioned in Article 6 of the Convention, the right to silence and the right not to incriminate oneself, are generally recognised international standards which lie at the heart of the notion of a fair procedure under Article 6. Their rationale lies, inter alia, in the protection of the accused against improper compulsion by the authorities thereby contributing to the avoidance of miscarriages of justice and to the fulfilment of the aims of Article 6. The right not to incriminate oneself, in particular, ... that the prosecution in a criminal case seek to prove their case against the accused without resort to evidence obtained through methods of coercion or oppression in defiance of the will of the accused. In this sense the right is closely linked to the presumption of innocence contained in Article 6(2) of the Convention.
    69. The right not to incriminate oneself is primarily concerned, however, with respecting the will of an accused person to remain silent. ..."
  45. We are not here concerned with the self-incrimination of a defendant with regard to an actual or potential criminal charge. We are concerned with the powers of a professional body to investigate the affairs of its members in the public interest and to discipline such members for breaches of the rules that apply to such professions. It was accepted before us that the proceedings in this matter were civil proceedings, as indeed was said in the Pine case, which do, however, have as their sanctions severe powers of restriction or exclusion of the member from practice.
  46. A similar problem arose in relation to the disciplinary processes of the accountancy profession in R v Institute of Chartered Accountants for England and Wales ex parte Nawaz. The Court of Appeal considered the application of the rules against self-incrimination in that context and, in the course of delivering judgment in that case, Leggatt LJ, with whom Thorpe LJ and Mummery LJ agreed, said this:
  47. "Waiver of privilege
    We indicated to counsel that for the purposes of this appeal we were content to assume, without deciding, that the privilege from self-incrimination at least extends to investigations of a quasi-judicial character such as we are concerned with. We have also assumed that the privilege was sufficiently claimed by Mr Nawaz's letter of 6th April 1994.
    Mr Sears submitted in writing that the waiver of privilege against self-incrimination is analogous with the abrogation of privilege by statutory provision. Orally, he pressed the argument with less force. Perhaps he had concluded that abrogation and waiver are not analogous for abrogation consists in the deprivation by Parliament of a privilege which a person otherwise enjoys, whereas waiver occurs where a person voluntarily foregoes a privilege that is his. Abrogation deprives him of choice, waiver represents an exercise of choice. When a person enters a profession he accepts its duties and liabilities as well as its rights and powers. Similarly, he may acquire or surrender privileges and immunities. Nevertheless, the principle that privilege is not to be regarded as having been abrogated, except by express words or necessary implication, applies also to waiver.
    In my judgment, acceptance of a duty to provide information demanded of an accountant constitutes a waiver by the member concerned of any privilege from disclosure. It is plainly in the public interest, as well as the interests of the profession, that the Institute should be enabled to obtain all such information in the possession of its members as is relevant to complaints of their professional misconduct.
    Mr Sears sought to reinforce his argument by contending that it is wrong to suggest that by agreeing to be bound by the rules of the Institute Mr Nawaz impliedly waived his right to assert privilege. I do not see why. It is true that this court has declined to hold that when one person becomes the fiduciary servant or agent of another they are to be treated as having impliedly contracted, they will not invoke the privilege of self-incrimination against the other. In the case of membership of a profession, the member accepts its rules and agrees to abide by them and to fulfil their requirements. Upon becoming a chartered accountant, it shall be the duty of every member, in accordance with paragraph 8(a) in Schedule 2 of the Supplemental Charter, to provide such information as investigation may consider necessary to discharge its functions. Compliance with that duty necessarily and inevitably precludes the exercise of any privilege that would have excused the provision of the information."
  48. To my mind, that passage is essentially determinative of this part of the appeal. The reasoning applies, in my view, precisely to the facts of this case. Mr Engelman urged upon us, however, that the principal so stated may be inconsistent with another decision of the Court of Appeal. In Bishopsgate Investment Management Limited v Maxwell [1993] Ch 1, some of the wording of Leggatt LJ's judgment indicates that perhaps he may have had that case in mind in making the comments that he did in the Nawaz case, however it is not expressly referred to in the judgment.
  49. In the Bishopsgate case, a company liquidator applied for an order under sections 235 and 236 of the Insolvency Act 1986 that a director should disclose information to that liquidator. The Director objected that to do so would infringe his privilege against self-incrimination. In separate proceedings, heard for these purposes together, two other companies sought remedies of an account and tracing against the same individual, who had also been a director of those companies. In the course of the proceedings, the plaintiff companies sought and obtained Mareva injunctions (freezing orders) against the defendant's former director, and included in those orders were requirements that the director should answer certain interrogatories. The director again objected on the basis that answers to questions might incriminate him. The Court of Appeal upheld the orders made under the Insolvency Act in the first proceedings and dismissed an appeal by the plaintiffs against the Judge's decision in the second proceedings that he was entitled to refuse to answer the interrogatories on the basis that the answers might incriminate him.
  50. Mr Engelman sought to rely upon certain passages in the judgment of Dillon LJ, relating to the second part of the decision to support his submission that a person could not be taken to have waived his privilege against self-incrimination by subscribing to the rules governing the conduct of profession of which he becomes a member. The submission of the plaintiff company in Bishopsgate had been that under the general law the privilege against self-incrimination is not available to a defendant if, immediately before the relevant time, ie, the time of the alleged fraud, the defendant was a fiduciary servant or agent of the plaintiffs in the action and the plaintiffs were by the action seeking to recover monies or property of the plaintiffs or an account of or information relating to such money or property for which the fiduciary is bound to account in equity (see [1993] Ch at page 33B).
  51. In support of the submission, the plaintiffs relied upon the decision of Sir Anthony Hart, Vice-Chancellor, in Green v Weaver [1827] 1 Sim 404 and of Sir John Romily MR in Robinson v Kitchin [1856] 21 Beav 365, affirmed in The Court of Appeal and Chancery 8 De G M & G 88.
  52. Having analysed the facts of Green v Weaver, Dillon LJ in the Bishopsgate case said, at pages 35H to 36A, referring to Sir Anthony Hart's judgment:
  53. "He then deduced from the authorities, to which I need not refer (but which it is suggested in a footnote in Bray on Discovery (1885), p. 338, he may have misunderstood), that a man by contract or the effect of his own acts may exclude himself from the benefit of the privilege against self-incrimination. He then, at p. 432, equated, in the eyes of a court of equity, the moral obligation of a confidential agent to give discovery, to an obligation resulting from a stipulation by deed. He stressed, as a justification of the decision on moral grounds, that the plaintiff as employer had no reason to suspect, and no means of detecting the misrepresentation of the fact whether the defendants were or were not duly constituted legal brokers."

  54. The decision in Robinson v Kitchin was to similar effect. Dillon LJ noted that these two cases were not referred to in any modern textbook and had only been referred to judicially in two modern cases, which he went on to consider. These were Rank Film Distributors v Video Information Centre [1982] AC 380 and Tate Access Floors Inc v Boswell [1991] Ch 512. Dillon LJ noted that in the former case Lord Templeman had left open whether the proposition derived from Green v Weaver was correct. He further observed that in the Tate case Sir Nicolas Browne-Wilkinson V-C had held that the cases did not establish the wide proposition that where a defendant agrees to act as a fiduciary he impliedly contracts not to raise the claim to the privilege against self-incrimination in any case brought by its principal to enforce the fiduciary duties. The Vice-Chancellor doubted whether the two 19th-century cases remained good law.
  55. Dillon LJ then continued in a passage specifically relied upon by Mr Engelman at page 37 of the judgment:
  56. "I do not find it necessary to consider whether the law does or does not permit a party to make an express contract with another party that the former will not rely on the privilege against the other in relation to any of their dealings. The difficulty I have is over the leap made by Sir Anthony Hart V-C from that to the position that a party cannot rely on the privilege where there is no such express contract."

  57. It is in the context of that explanation of the authorities in Bishopsgate that Dillon LJ's later remarks about the deep entrenchment of the privilege in our law must be understood (see page 38F of the same judgment). That is sufficient, in my view, to show that the decision in the Bishopsgate case is not, in fact, inconsistent with the decision, in a very different context, in the R v Institute of Chartered Accountants ex parte Nawaz encapsulated in the passage from the judgment of Leggatt LJ, which I have quoted above. As already indicated, I take the view that that case is sufficiently close to the circumstances of the case before this court to call for the rejection of the submission made on this part of the case by Mr Engelman.
  58. Next, the finding of dishonesty. On this aspect of the case, and subject to the points already considered, Mr Engelman submitted that the Tribunal was entitled on the evidence to conclude that Mr Holder had been guilty of breaches of the Solicitors Accounts Rules. He argued that a substantial part of the dishonesty alleged arose from the treatment of two particular client accounts in respect of which letters had been produced from the clients after the event, indicating that they themselves did not make any allegation of dishonesty against Mr Holder. Mr Engelman submits that such letters had a significant bearing on the question of whether or not Mr Holder had, in fact, been dishonest and the Tribunal appears not to have given them adequate weight.
  59. It is clear, however, that the Tribunal did have the letters clearly in mind since they were expressly quoted in its findings. The Tribunal obviously had before it substantially more evidence that has been before this court on this appeal. It also had the benefit of hearing Mr Holder's oral evidence and explanations. The Tribunal's view of Mr Holders evidence was as follows:
  60. "The Tribunal did not find him to be an open and frank witness. He appeared only too willing to put a gloss on those matters in evidence that would best suit his purpose. He claimed not to have full details at his fingertips. He had not taken any steps to prepare for the hearing and, in particular, he had not sought to inspect or obtain copies of relevant documentations."
  61. Having carefully reviewed the evidence concerning Mr Holder's accounting, the Tribunal concluded as follows in paragraph 77:
  62. "The Tribunal, applying the test in Royal Brunei Airlines v Tann as approved and augmented in the case of Twinsectra v Yardley, finds that the Respondent did use clients' money for his own purposes and did so dishonestly. The Respondent's attitude to monies which he held, and his lack of proper book-keeping meant that he was not sure of the accurate position with regard to his client account. His failure to draw formal bills and his failure to obtain proper instructions left him in the position where he really could not be certain of the state of his account with individual clients. At best, to transfer client money to his own benefit whilst that state of affairs continued demonstrated that the Respondent did not ensure that he exercised a proper stewardship over clients' funds. Any transaction made in the absence of certainty as to the true state of affairs was itself demonstrative of the Respondents's failure to be sure that his dealings with client funds were entirely appropriate. Such turning of a blind eye was in itself dishonesty."
  63. The Tribunal was entitled on the evidence to reach the view that it did on the question of dishonesty and, for my part, I cannot see that any error in its approach to that finding has been demonstrated, notwithstanding the careful argument on Mr Engelman on this aspect of the case also.
  64. Finally, penalty. It follows that the penalty of striking off the Roll was appropriate in this case. However, I would add that even in the absence of dishonesty, the deficiencies in Mr Holder's handling of his client accounts were so gross that I find it impossible to say that the Tribunal would have been wrong to conclude that this was an appropriate case for making such an order in any event. It follows that, for my part, I would dismiss this appeal.
  65. LADY JUSTICE SMITH: I agree, and have nothing to add.
  66. MR JUSTICE SIMON: I also agree.
  67. MR JUSTICE McCOMBE: Mr Engelman, the appeal is therefore dismissed. Thank you for your assistance. Any other applications?
  68. MR MILLER: Merely in terms of costs, my Lady, in terms of the Law Society's costs.
  69. LADY JUSTICE SMITH: Yes. Can you oppose that?
  70. MR ENGELMAN: My Lady, no.
  71. LADY JUSTICE SMITH: Very well. You may have your costs.
  72. MR MILLER: Can I trouble you to do a summary assessment?
  73. LADY JUSTICE SMITH: We have not seen the material, I do not think, have we?
  74. MR MILLER: I understand that they were lodged with the court, but I do have a spare copy.
  75. LADY JUSTICE SMITH: We have another case. Do you know if there is any dispute about this?
  76. MR ENGELMAN: My Lady, the bill submitted is just over 17,000. 58.2 hours have been spent on preparation for this appeal and that is the matter we would like to explore.
  77. LADY JUSTICE SMITH: We think that in those circumstances a detailed assessment would be more appropriate, but you have your order for costs. Thank you very much. I think there is nothing else.


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