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Cite as: [2015] PNLR 8, [2014] EWCA Civ 1491

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Neutral Citation Number: [2014] EWCA Civ 1491
Case No: A2/2014/1245


[2014] EWHC 821 (QB)

Royal Courts of Justice
Strand, London, WC2A 2LL

B e f o r e :



Kanat Assaubayev and Others
- and -

Michael Wilson & Partners Limited


Nicholas Bacon QC, Ricky Diwan and George McDonald (instructed by Reed Smith LLP) for the Appellant
David Holland QC and Paul Joseph (instructed by Direct Access) for the Respondent
Hearing dates : 14th October 2014



Crown Copyright ©


  1. The question in this appeal is whether the judge was wrong to stay a claim by which the Appellants challenged the entitlement of the Respondent to recover legal fees in circumstances where, as they contend, the Court itself has and should exercise its supervisory jurisdiction over solicitors and others in relation to the matters of which they complain.
  2. The parties

    The Appellants

  3. The first five Appellants are members of a prominent and wealthy Kazakhstani family. I distinguish them by their first names. Kanat is the father; Marusya the mother; and Baurzhan, Aidar and Sanzhar are the sons. I call all five "the family". The sixth Appellant – Hawkinson Capital Inc ("Hawkinson") – is one of the companies associated with their commercial activities. The family and Hawkinson are, together, the Appellants. There was a seventh claimant – JSC Credit Altyn Bank – which has taken no part in the claim the subject of this appeal since February 2012.
  4. In June 2010 the family became embroiled in major commercial litigation in the Chancery Division in what has been called the Jenington Action. This related to dealings in shares in Kazakhgold, which were held indirectly by members of the family prior to their acquisition by Jenington International Inc. On 23 June 2010 the claimants in that action obtained a worldwide freezing order against the family and others.
  5. The Respondent

  6. Michael Wilson & Partners Limited ("MWP") is a company incorporated in the British Virgin Islands. It describes itself as a legal advisor. Its managing director was Michael Wilson, who was at all material times recorded on the roll of solicitors of the Senior Courts and held a practising certificate in England and Wales.
  7. MWP is not and never could have been at any material time any of the following:
  8. i) a solicitor of the Senior Courts;

    ii) a firm of solicitors of which at least one partner was a solicitor;

    iii) a "recognised body" under section 9 of the Administration of Justice Act 1985; or

    iv) an authorised person under the Legal Services Act 2007.

    It could not have come within (i) or (ii) because it was a BVI registered company: see [21] below. It could not come within (iii) because it did not and could not comply with regulation 2.1 of the Solicitors Regulatory Authority ("SRA") Recognised Bodies Regulations in that, inter alia, it could not comply with Rule 14.03 of the Solicitors Code of Conduct 2007 since it was neither incorporated in England and Wales nor had a practising address there: see section 9 (1) (b) at [23] below. It could not have been an authorised person under the 2007 Act because the statutory scheme for authorisation under that Act did not come into force until 1 October 2011.

    The Retainers

  9. By a letter from MWP dated 2 July 2010 ("the July Retainer"), apparently signed by the family and on behalf of Hawkinson and Gold Lion Holdings Ltd, a company which is not party to these proceedings, MWP was engaged to provide the family and Hawkinson with legal services in relation to the Kazakhstan aspects of the issues and the dispute that had arisen with a number of companies including Jenington International Inc relating to and involving KazakhGold Plc and KazakhAltryn MMC JSC. This was the subject matter of the Jenington action. In Schedule 1 there was a Summary of Key Personnel. These included Michael Wilson, whose business associations were said to include Membership of the Law Society of England & Wales. Included amongst the educational details of another individual at MWP was the fact that he had been admitted as a solicitor in England & Wales in 2005.
  10. By a letter from MWP dated 24 August 2010 ("the August retainer"), signed by Aidar, Aidar engaged MWP with effect from 24 August 2010 to act for him personally with respect to his involvement as a defendant in the Jenington Action. The letter attached the same Schedule. The August retainer appears to have been entered into because the solicitors acting for the other defendants in the Jenington action were not prepared to go on the record for Aidar because to do so would make it difficult to maintain that Aidar and Baurzhan were not communicating with the rest of the family or aware of the freezing and disclosure orders made against them: see para 78 ff of the judgment.
  11. Both the July and the August retainers provided that they were to be governed by the laws of England & Wales and that, at MWP's absolute discretion, any Dispute (as defined) arising out of or relating to the relevant Retainer, or the breach, termination or invalidity thereof might be referred to mediation under the LCIA mediation procedure and, if not settled within 60 days of the appointment of a mediator, or if MWP did not want to mediate, the Dispute was to be settled at MWP's absolute discretion either (i) by the courts of Kazakhstan; (ii) the courts of the country where the client's registered office or principal place of business was situated or, if an individual, the country of his/her domicile or residence or (iii) by arbitration before the LCIA in accordance with UNCITRAL rules.
  12. The Jenington Action

  13. The action was begun in June 2010. On 31 August 2010 MWP filed an acknowledgment of service in the action on behalf of Aidar. I say "MWP" but the relevant form was signed in a box which lies immediately above the words (on the printed form) "Defendant's solicitor". The address to which documents were required to be sent was "Michael Wilson & Partners, 25, Grove Road, Barnes London". On 3 September 2010 MWP filed an application notice on behalf of Aidar for relief from sanction. The name given was "Michael Wilson & Partners". An "x" was inserted in the box in respect of the question "Are you a solicitor?". The signature appeared above the words (on the form) "Applicant's solicitor". The name given and the address details were as before. On 22 October 2010 MWP signed a consent order in the action. This was signed on behalf of Michael Wilson & Partners Ltd described, now, as Legal Advisers for the Third Defendant. On 11 November 2010 MWP signed a consent order in the same form as the order of 22 October 2010 save that they signed as Legal Advisers of the Third (Aidar) and Fifth (Baurzhan) Defendants. On 26 January 2011 MWP signed a further consent order on behalf of Aidar in the 22 October form.
  14. On 30 March 2011 MWP filed an acknowledgment of service on behalf of Baurzhan. This was in the same form as the acknowledgement signed on behalf of Aidar save that MWP had "Ltd" in its name. There was still a signature in the box above the words "(Defendant/Defendant's solicitor/Litigation friend)". On 12 April 2011 MWP signed another consent order on behalf of Baurzhan with "Ltd" in their title but now describing themselves as "solicitors for the Fifth Defendant".
  15. On 2 May 2011 Cleary Gottlieb replaced MWP on the record for Aidar and Baurzhan and filed a Notice of Change to that effect. Pursuant to a Memorandum of Understanding of 18 September 2010 and a Principal Agreement initialled and signed by all parties on 30 November 2010, and later dated 8 December 2010, the Jenington action was settled. This settlement was further documented by an additional Settlement Deed dated 7 May 2011.
  16. The Fees

  17. MWP invoiced the family for a total sum of US $ 8,906,030.02 for work said to have been done over a 13 month period pursuant to the Retainers. Most of it -
    US $ 8,187,668.56 – was said to have been done under the July retainer. More than
    US $ 3 million has been paid.
  18. The Action

  19. On 16 August 2011 the Appellants issued a Part 8 Claim in the Senior Courts Costs Office ("the SCCO") seeking (i) an order setting aside the July Retainer; (ii) an order for delivery of a solicitor's bill of costs in all causes and matters in respect of which MWP had acted for the Appellants; and (iii) detailed assessment of the bill so delivered or of the 26 invoices (as set out in an attached schedule)[1] which MWP had rendered. In each case the relief was sought under Part III of the Solicitors Act 1974.
  20. On 27 January 2012 MWP applied to stay these claims under section 9 of the Arbitration Act 1996 and/or the inherent jurisdiction, in reliance on the arbitration clause in the July Retainer. MWP had previously commenced arbitration proceedings by a request for arbitration dated 8 July 2011 seeking payment of the balance of its fees pursuant to the July Retainer. However the invoices accompanying the request for arbitration included by mistake ten that had been rendered to Aidar under the August Retainer, which were later removed. On 24 September 2013 MWP applied to stay the Part 8 claim so far as it lay in respect of the August Retainer.
  21. On 10 September 2012 Master Campbell refused MWP's application to stay the SCCO proceedings in respect of the July Retainer. He held that the claims were within the scope of the arbitration agreement contained in the July Retainer but then held, pursuant to section 9 (4) of the 1996 Act, that that arbitration agreement was null, void, inoperative or incapable of being performed. On 26 October 2012 he handed down a detailed judgment. In essence he concluded that MWP could not benefit from an agreement for arbitration of a claim for work done when MWP was pretending to be an English solicitor. He applied, as he thought, the principle in Alghussein v Eton College [1988] 1 WLR 587 that a person cannot benefit from his own wrong.
  22. In the light of MWP's contention that it was not a solicitor the Appellants, with the Master's permission, amended their claim form on 8 July 2013. As a result of the amendment the Claim Form contains claims under what has been called the Court's "ordinary" jurisdiction and also under what has been called the Court's "supervisory jurisdiction" i.e. its inherent jurisdiction over its officers. Most of the claims arise under both headings.
  23. The claims other than those under Part III of the Solicitors Act 1974 in respect of the family are as follows:
  24. a) Ordinary relief claims:
    i) An assessment of MWP's invoices at common law;
    ii) An order that the entirety of the July and August Engagement Letters (i.e. the two Retainers), or parts thereof, be set aside; and
    iii) A declaration that the Engagement Letters are unenforceable and/or that the fees invoiced are irrecoverable, with restitution for any overpayment.
    b) Supervisory jurisdiction claims:
    i) An assessment/moderation of MWP's invoices; and
    ii) An order that the entirety of the Retainers, or parts thereof, be set aside, including the arbitration agreements.
  25. In a careful and detailed judgment on appeal Walker J held, firstly, that the Appellants' original claims based on Part III of the Solicitors Act 1974 (and any other claim so based) should be struck out on the grounds that, since MWP was not in fact a solicitor, the Act was inapplicable. The Appellants do not challenge that finding.
  26. Next he held that the Appellants' claims to supervisory relief were not arbitrable. This is not in dispute either. The jurisdiction of the Court over solicitors is a jurisdiction which belongs to it alone. No arbitrator can exercise it; nor can anyone other than the Court.
  27. The judge was invited to rule on whether or not the Court had a supervisory jurisdiction over persons such as MWP. He considered the point but took the view that this not altogether easy question of jurisdiction should be left until the facts were clearer and until the arbitral tribunal had determined (a) whether it had jurisdiction; and (b) whether and to what extent MWP's claims were valid. He, therefore, stayed, under the inherent jurisdiction, any claim other than the ones that he had struck out and ordered that, subject to any order of the court ordering otherwise, no party might apply to lift the stay until the earliest of (i) the final determination of any appeal or application to the court made by any party to the arbitration arising out of or in relation to a final award which dealt with all matters in issue in the arbitration, (ii) the final determination of any appeal or application to the court by any party to the arbitration arising out of or in relation to an interim award which decided the issues of the arbitrator's jurisdiction in relation to any claim in this action; or (iii) agreement in writing by the parties.
  28. The Legislation

  29. The legislation in force at the relevant time under the Solicitors Act 1974 ("the 1974 Act"), the Administration of Justice Act 1985 ("the 1985 Act"), the Administration of Justice Act 1990 ("the 1990 Act"), and the Legal Services Act 2007 ("the LSA 2007") is somewhat tortuous. The judge helpfully set out the sections in force at the material time in Appendices to his judgment. For present purposes it is sufficient to refer only to some of them:
  30. The 1974 Act

    The Act included the following provisions:

    "1 Qualifications for practising as solicitor.
    No person shall be qualified to act as a solicitor unless—
    (a) he has been admitted as a solicitor, and
    (b) his name is on the roll, and
    (c) he has in force a certificate issued by the Society in accordance with the provisions of this Part authorising him to practise as a solicitor (in this Act referred to as a "practising certificate")
    1A Practising certificates: employed solicitors.
    A person who has been admitted as a solicitor and whose name is on the roll shall, if he would not otherwise be taken to be acting as a solicitor, be taken for the purposes of this Act to be so acting if he is employed in connection with the provision of any legal services—
    (a) by any person who is qualified to act as a solicitor;
    (b) by any partnership at least one member of which is so qualified;
    (c) by a body recognised. under section 9 of the Administration of Justice Act 1985 (incorporated practices). or
    (d) by any other person who, for the purposes of the Legal Services Act 2007, is an authorised person in relation to an activity which is a reserved legal activity (within the meaning of that Act)."
  31. The Act contains severe sanctions for those who act as solicitors when they are unqualified to do so, or who pretend to be solicitors when they are not. Sections 20, 21, 24 and 25 provide as follows.
  32. "20 Unqualified person not to act as solicitor.
    (1) No unqualified person is to act as a solicitor.
    (2) Any person who contravenes subsection (1) is guilty of an offence and liable on conviction on indictment to imprisonment for not more than 2 years or to a fine, or to both.
    21 Unqualified person not to pretend to be a solicitor.
    Any unqualified person who wilfully pretends to be, or takes or uses any name, title, addition or description implying that he is qualified or recognised by law as qualified to act as a solicitor shall be guilty of an offence and liable on summary conviction to a fine not exceeding the fourth level on the standard scale.
    24 Application of penal provisions to body corporate.
    (1) If any act is done by a body corporate, or by any director, officer or servant of a body corporate, and is of such a nature or is done in such a manner as to be calculated to imply that the body corporate is qualified or recognised by law as qualified to act as a solicitor—
    (a) the body corporate shall be guilty of an offence and liable on summary conviction to a fine not exceeding the fourth level on the standard scale, and
    (b) in the case of an act done by a director, officer or servant of the body corporate, he also shall be guilty of an offence and liable on summary conviction to a fine not exceeding the fourth level on the standard scale.
    (2) For the avoidance of doubt it is hereby declared that in section 20 the reference to an unqualified person and the reference to a person both include a reference to a body corporate.
    25 Costs where unqualified person acts as solicitor.
    (1) No costs in respect of anything done by any unqualified person acting as a solicitor shall be recoverable by him, or by any other person, in any action, suit or matter.
    (2) Nothing in subsection (1) shall prevent the recovery of money paid or to be paid by a solicitor on behalf of a client in respect of anything done by the solicitor while acting for the client without holding a practising certificate in force if that money would have been recoverable if he had held such a certificate when so acting."

    The 1985 Act

  33. The Act introduced a new concept of "recognised bodies", which includes LLPs and corporate bodies. Section 9 of the Act provides:
  34. "(1) The Society may make rules—
    (a) making provision as to the management and control of legal services bodies;
    (b) prescribing the circumstances in which such bodies may be recognised by the Society as being suitable bodies to undertake the provision of any solicitor services or other relevant legal services;
    (c) prescribing the requirements which (subject to any exceptions provided by the rules) must at all times be satisfied by bodies corporate so recognised if they are to remain so recognised; and
    (d) regulating the conduct of the affairs of such bodies.
    (3) Despite section 24(2) of the 1974 Act, section 20 of that Act (prohibition on unqualified person acting as solicitor) does not apply to a recognised body; and nothing in section 24(1) of that Act applies in relation to such a body.
    (6) Schedule 2 (which makes provision with respect to the application of provisions of the 1974 Act to recognised bodies and with respect to other matters relating to such bodies) shall have effect.
    (8) In this section –
    "legally qualified" and "legal services body" have the meaning given by section 9 A;
    "recognised body" means a body … for the time being recognised under this section;
    9A Legal Services Bodies
    There follows an extensive definition. A legal services body may, but need not, be a body corporate,
    10 Penalty for pretending to be a body recognised under section 9
    (1) A body shall not describe itself or hold itself out as a body for the time being recognised under section 9 unless it is so recognised.
    (2) Any body which contravenes subsection (1) shall be guilty of an offence and liable on summary conviction to a fine not exceeding the fourth level on the standard scale.
    Costs: general modification of provisions of Part III of 1974 Act
    22 (1) In the provisions to which this paragraph applies
    (a) any reference to a solicitor or to a client of a solicitor shall be construed as including a reference to a recognised body or to a client of such a body; and
    (b) any reference to a client's solicitor shall be construed as including a reference to any recognised body acting for a client.
    (2) This paragraph applies to the following provisions of the 1974 Act (which relate to the remuneration of solicitors in respect of contentious and non contentious business)…"
    Various provisions of Part III of the 1974 Act are then set out.

    The Legal Services Act 2007

  35. The Act introduced a new concept of "reserved legal activity". Sections 12-14, and 17-18 provide as follows:
  36. "12 Meaning of "reserved legal activity" and "legal activity"
    (1) In this Act "reserved legal activity" means–
    (a) the exercise of a right of audience;
    (b) the conduct of litigation;
    (2) Schedule 2 makes provision about what constitutes each of those activities.
    (3) In this Act "legal activity" means–
    (a) an activity which is a reserved legal activity within the meaning of this Act as originally enacted, and
    (b) any other activity which consists of one or both of the following–
    (i) the provision of legal advice or assistance in connection with the application of the law or with any form of resolution of legal disputes;
    (ii) the provision of representation in connection with any matter concerning the application of the law or any form of resolution of legal disputes.
    13 Entitlement to carry on a reserved legal activity
    (1) The question whether a person is entitled to carry on an activity which is a reserved legal activity is to be determined solely in accordance with the provisions of this Act.
    (2) A person is entitled to carry on an activity ("the relevant activity") which is a reserved legal activity where–
    (a) the person is an authorised person in relation to the relevant activity, or
    (b) the person is an exempt person in relation to that activity.
    14 Offence to carry on a reserved legal activity if not entitled
    (1) It is an offence for a person to carry on an activity ("the relevant activity") which is a reserved legal activity unless that person is entitled to carry on the relevant activity.
    (2) In proceedings for an offence under subsection (1), it is a defence for the accused to show that the accused did not know, and could not reasonably have been expected to know, that the offence was being committed.
    (3) A person who is guilty of an offence under subsection (1) is liable–
    (a) on summary conviction, to imprisonment for a term not exceeding 12 months or a fine not exceeding the statutory maximum (or both), and
    (b) on conviction on indictment, to imprisonment for a term not exceeding 2 years or a fine (or both).
    (4) A person who is guilty of an offence under subsection (1) by reason of an act done in the purported exercise of a right of audience, or a right to conduct litigation, in relation to any proceedings or contemplated proceedings is also guilty of contempt of the court concerned and may be punished accordingly.
    17 Offence to pretend to be entitled
    (1) It is an offence for a person–
    (a) wilfully to pretend to be entitled to carry on any activity which is a reserved legal activity when that person is not so entitled, or
    (b) with the intention of implying falsely that that person is so entitled, to take or use any name, title or description.
    (2) A person who is guilty of an offence under subsection (1) is liable–
    (a) on summary conviction, to imprisonment for a term not exceeding 12 months or a fine not exceeding the statutory maximum (or both), and
    (b) on conviction on indictment, to imprisonment for a term not exceeding 2 years or a fine (or both)."
    18 Authorised persons
    (1) For the purposes of this Act "authorised person", in relation to an activity ("the relevant activity") which is a reserved legal activity, means –
    (a) a person who is authorised to carry on the relevant activity by a relevant approved regulator in relation to the relevant activity (other than by virtue of a licence under Part 5), or
    (b) a licensable body which, by virtue of such a licence, is authorised to carry on the relevant activity by a licensing authority in relation to the reserved legal activity.
    The Reserved Legal Activities
    Conduct of litigation
    4 (1) The "conduct of litigation" means–
    (a) the issuing of proceedings before any court in England and Wales,
    (b) the commencement, prosecution and defence of such proceedings, and
    (c) the performance of any ancillary functions in relation to such proceedings (such as entering appearances to actions).
    (2) But the "conduct of litigation" does not include any activity within paragraphs (a) to (c) of sub-paragraph (1), in relation to any particular court or in relation to any particular proceedings, if immediately before the appointed day no restriction was placed on the persons entitled to carry on that activity."
  37. For present purposes the relevant approved regulator is the SRA, exercising functions previously exercised by the Law Society. Those authorised by the SRA include recognised bodies under the 1985 Act.
  38. As is apparent from all of the above it is a criminal offence (a) for an unqualified person (i) to act as a solicitor or (ii) to pretend to be a solicitor; and (b) for a person who is not entitled to carry on a reserved legal activity (i) to carry on that activity or (ii) to pretend to be entitled to do so.
  39. The issues

  40. The following issues potentially arise:
  41. a) Did MWP act as, or pretend to be, a solicitor when unqualified?
    b) Did MWP carry on, or pretend to be entitled to carry on, a reserved legal activity when not entitled to do so?
    c) If the answer to any of the above is in the affirmative does the Court have any supervisory jurisdiction over MWP given that it is neither a solicitor nor a person entitled to carry on a reserved legal activity?
    d) If it does, was the judge wrong to stay the Appellants' claim under the ordinary jurisdiction for arbitration, rather than exercise the Court's own supervisory jurisdiction?

    The Court's supervisory jurisdiction

  42. The Court's jurisdiction over solicitors is of long standing. It is based, as repeated statements in the authorities show, on the fact that solicitors are officers of the Court itself, over whom the Court exercises a jurisdiction on that account. As Lord Esher put it in In Re Grey [1892] 2 QB 440.443:
  43. "…the Court has a punitive and disciplinary jurisdiction over solicitors, as being officers of the Court, which is exercised not for the purpose of enforcing legal rights, but for the purpose of enforcing honourable conduct on the part of the Court's own officers…the Court has a right to see that its own officer does not act contrary to his duty"
  44. Similar observations may be found in Myers v Elman [1940] AC 282, 317-9. In that case Lord Wright referred to the summary nature of the procedure and said that it was "not merely punitive but compensatory" - as to which see also Udall v Capri Lighting Ltd [1987] 1 QB 907 - and involved a discretion as to the relief to be granted. Such observations are also to be found in R & T Thew v Reeves [1982] QB 1285-6; and in Harrison v Tew [1990] 2 AC 523, 529. The latter case confirms that the inherent jurisdiction extends to ordering an assessment of a solicitor's bills of costs, but also that the time limit of 12 months after delivery of a bill provided by section 70 (4) of the 1974 Act[2] displaced the Court's inherent jurisdiction in this respect, so that an application for assessment of a bill must be made within that time limit[3].
  45. The jurisdiction is:
  46. "indeed extraordinary, being based upon the right of the court to see that a high standard of conduct is maintained by its officers acting as such… It is, in a sense, a domestic jurisdiction to which solicitors are only amenable because of their special relationship with the court and it is designed to impose higher standards than the law applies generally".

    Per Sir John Donaldson MR in John Fox v Bannister King & Rigbeys [1988] QB 925.

  47. Although it may have a compensatory aspect, the jurisdiction is essentially "punitive and disciplinary" in nature: per Lord Esher MR in In re H.A. Grey [1892] 2 QB, 440, 443. It has been described as "residual" per Robert Goff LJ in Symbol Park Land v Steggles Palmer [1985] 1 WLR 668, 674. It is for the Court to decide whether and, if so, when to exercise the jurisdiction and how to do so. It may, and often does, act summarily. But it may adopt whatever procedure it thinks fit and decide what evidence it will receive and in what form: see Myers v Elman at 318 and Brendon v Spiro [1936] I KB 176 at 192 and 195. Although it will often wish to act at once, it may decide to adjourn any consideration of whether or not to exercise the jurisdiction pending other developments.
  48. Those who appear before the Court but who are not, and do not purport, to be, solicitors or recognised bodies, do not come within the jurisdiction. The most obvious example is barristers. They owe duties to the Court but are not subject to the jurisdiction of the Court over its officers, which they are not. All those who appear before the Court, whether lawyers, litigants, witnesses or watchers of proceedings may, of course, face the sanction of contempt if they misbehave. Their misbehaviour may, if sufficiently serious, amount to a criminal offence (such as perjury or attempting to pervert the course of justice). But neither contempt nor criminal conduct of itself brings them within the supervisory jurisdiction.
  49. What then of somebody who is not qualified as a solicitor but who acts as such or pretends either to the Court or his clients or both that he is one? A possible view is that, since he is not a solicitor, he cannot be subject to a jurisdiction which applies only to those who are. There are, however, cases which indicate that in some circumstances the Court may exercise this jurisdiction over someone who is not in fact a solicitor.
  50. In In re Hulm & Lewis [1892] 2 QB 261 Mr Cohen employed Hulm & Lewis to act as his solicitors in respect of a composition with his creditors. Lewis received money and documents from him. Finding that his creditors had not been paid Mr Cohen went to another firm. The new firm issued a summons against Hulm & Lewis applying for the return of Mr Cohen's documents and an account of the monies received. Some documents were given over and £ 100 was admitted to be due. Mr Cohen agreed to accept that sum in settlement; but it was not paid. The Master ordered Lewis to deliver up all Mr Cohen's documents and to account for all monies received by him and to pay them to Mr Cohen or his new solicitors. It was then that Lewis said that he was not a solicitor at all. Pollock B held that as he was not a solicitor there was no jurisdiction to issue a writ of attachment against him for his disobedience.
  51. On appeal Matthew and Collins JJ held that the Court "had power to deal with the delinquent", Collins J said that:
  52. "…the Court has in these matters as much jurisdiction over a person who is not a solicitor as it has over a solicitor. Here the person who is not a solicitor has assumed the privileges of a solicitor, has obtained the custody of documents, has been entrusted with money, and has carried on legal proceedings as an officer of the Court. The Court finds this person in the possession of money and documents which, if he were a solicitor, he would be bound to hand over to his client. It seems to me that his not being a solicitor can make no difference. If this person were a solicitor the Court could compel him to restore the money and documents, and the Court must have the same power when he is shown to have obtained possession of the money and documents by fraudulently pretending to be a solicitor. The case is completely covered by the authority cited by my learned brother".
  53. That authority was Wilton v Chambers 7 A & E 524 [1837]. In that case Mr Wilton charged his clients in respect of work done since 1826. He had been admitted as an attorney a long time before but had ceased to have the certificate required by the statute since 1820 when he had ceased to have clients. In 1823 he was readmitted but failed to take out any certificate until 1826. Lord Denman held that, in order for him lawfully to practice from 1826, he needed to be readmitted then, which he had not been. Since that was so he was incapable of practising from 1826; his admission was null and void by reason of the relevant statute – section 31 of 37 G 3, c 90 and "in other words... he was off the roll of attorneys". Lord Denman held that the attorney was, therefore, unable to avail himself of the judgment and securities that he had obtained in respect of his work on the basis that "whatever is obtained through the medium of an illegal practice is itself illegal".
  54. I rather doubt whether this was in truth an exercise of the Court's disciplinary jurisdiction over solicitors. The ground of the motion, which was for cancellation of the warrant of attorney, the vacation of judgements obtained against the client and the giving up for cancellation of certain securities, was that the attorney was disabled from practising as such by section 31. If it is to be regarded as an exercise of that jurisdiction the case shows how closely any such jurisdiction overlaps with the question of illegality.
  55. In Brandon v Spiro [1938] 1 KB 176, 190 the Court of Appeal referred to In re Hulm, which Mr David Holland QC submits was either wrongly decided or to be confined to its particular facts, as:
  56. "an illustration of the exercise of jurisdiction by the Court to protect its duly authorised officers, solicitors on the roll, from imposition by persons representing that they are solicitors when they are not".
  57. In In re Hurst & Middleton Ltd [1912] 2 Ch 520 a receiver appointed under debentures, of which he was the 2/3rd owner, sold the assets of a company for £ 900 and was ordered to lodge the purchase money in Court. Evans, the receiver's solicitor received £ 742, the net sum. No money was paid into court. On a motion brought by the receiver's assignee, the now plaintiff, an order was made that Evans should lodge the £ 742 within 7 days. Evans had given at least £ 680 of the £ 742 to Jones. Jones was a solicitor's clerk, who carried on business as a debt collector and became closely associated with Evans. In effect Jones ran the business. Evans paid Jones £ 1 a week for the use of an office and furniture. Evans had no bank account nor safe nor furniture and practically no clients of his own. Everything went through Jones' bank account. Jones introduced practically all the business; shared in the profit, provided for all out of pocket expenses, and bore any loss. It was Jones who had introduced the business in question to Evans.
  58. The plaintiff moved for an order that Jones should lodge £ 680 in court within 7 days, being the sum admitted to have been received by him with knowledge that it formed part of the purchase money ordered to be paid into court. Jones had also received a further £ 100 as representative of Evans, being a deposit paid by the purchaser upon the execution of the provisional contract for the sale of the company's assets and a further £ 100 on account of the purchase money.
  59. Eve J held that Jones had assumed the privileges of a solicitor and carried on legal proceedings as an officer of the Court and was therefore amenable to the Court's summary jurisdiction.
  60. The Court of Appeal set the order aside. Farwell LJ held that he could find no ground on which the Court could exercise summary jurisdiction against a man "who is not its own officer and has not acted in the particular matter in such a way as to get money or property by holding out falsely that he was such an officer". The £ 100 had only been obtained as agent for Evans. The £ 680 was not obtained "by holding himself out as a solicitor, or in any way acting as a solicitor". The money had got into Evans' hands and Jones had then somehow got hold of it from him. Evans was the solicitor on the record. Even if Jones had stolen it from Evans he would not have got the money as, or by pretending to be, a solicitor.
  61. Farwell LJ regarded In re Hulm & Lewis as a case open to review by the Court but did not propose to do so. He treated it as a case where Hulm & Lewis has been named as partners and had had orders made for and against them in the suit and
  62. "having, by means of such wrongful assumption of a privilege to which he was not entitled, obtained from the Court orders which he could only have obtained in that particular capacity, was estopped from setting up any such pleas to the jurisdiction as that he was not a solicitor as he pretended to be and by means of which pretence he obtained the money".
  63. Kennedy LJ agreed. He said that, to succeed in an application such as this:
  64. "you must show that the act which is the basis of the application is an act done by the man as a solicitor unqualified in fact but representing himself in the transaction to be a solicitor and, more than that, obtaining by that representation either some property of which it is sought to divest him, or doing some act for which a remedy is sought which the Court can summarily give".
  65. The "keystone of the success of such an application" was, he held:
  66. "that the man has, by virtue of his assumption of the position and privilege of a solicitor, either obtained something which he ought not to have obtained (I do not desire to limit it – there may be other cases, but broadly that would be generally the case), and therefore the restitution of which is just, or done some act for which there would be a remedy in the Court if it were an act done by an officer of the Court, and if the man has done the act or obtained the property by the assumption of the privilege and position of a solicitor. In such a case the Court will exercise the power which it would be right to exercise if the man were an officer of the Court; and in such a case the man cannot be allowed to say that he is free from the jurisdiction of the Court because he is not in fact, a solicitor, and therefore not an officer of the Court."

    In that case, as he pointed out, Jones had not obtained the money from Evans on the faith of any representation that he was a solicitor; and with regard to the earlier applications for money he was representing himself to be acting for the solicitor on the record.

    Jurisdiction over non-solicitors

  67. I am quite satisfied that the Court's supervisory jurisdiction does not extend to anyone or any body who or which (a) is not a solicitor, (b) does not act as one, and (c) does not pretend to be one - for the simple reason that anyone in that category is not, and does not purport to be, an officer of the Court. The Court's jurisdiction arises in respect of its officers. That it does so is confirmed by section 50 of the 1974 Act which provides:
  68. "(1) Any person duly admitted as a solicitor shall be an officer of the Senior Courts;
    (2) Subject to the provisions of this Act, the High Court, the Crown Court and the Court of Appeal respectively, or any division or judge of those courts, may exercise the same jurisdiction in respect of solicitors as any one of the superior courts of law or equity from which the Senior Courts were constituted might have exercised immediately before the passing of the Supreme Court of Judicature Act 1873 in respect of any solicitor, attorney or proctor admitted to practise there."
  69. A corporate body recognised under section 9 of the 1985 Act may provide legal services entirely lawfully. But it does not, on that account, become an officer of the Court and thereby subject to the supervisory jurisdiction. Noticeably neither the 1985 Act nor the LSA 2007 makes any provision for the exercise of the Court's jurisdiction in respect of solicitors to be extended to non-solicitors although section 14 (4) of the LSA 2007 does extend the contempt of court jurisdiction to those who offend against section 14 (1). Recognised legal bodies may, of course, have members who are solicitors, in respect of whom the court will have jurisdiction; but that will not apply to a body such as MWP – a BVI company – itself.
  70. That being so, there can, in my view, be no scope for applying or extending the Court's supervisory jurisdiction to bodies corporate which pretend to be recognised bodies. There is no logic in exercising a jurisdiction against a body which pretends to be something if the Court would not have that jurisdiction if the body was what it pretended to be.
  71. Mr Nicholas Bacon QC for the Appellants submitted that the Court's jurisdiction should be regarded as extending to solicitors and any others who conduct litigation before the courts. I do not accept this. The submission (a) ignores the foundation of the jurisdiction and (b) proves too much. On that footing barristers would be covered by it as well.
  72. If, therefore, all that MWP did was to act as, or pretend to be, a recognised body there can, Mr Holland for MWP submits, be no question of the Court exercising the supervisory jurisdiction. That, however, begs the question whether that was all that MWP did. Before the judge it was conceded that MWP was in breach of section 20 of the 1974 Act in coming on the record in the Jenington action on behalf of Aidar and Baurzhan. The judge questioned whether that concession was well founded and Mr Holland sought to withdraw it. On the other side of the fence Mr Bacon appeared at one stage to accept that MWP acted as if it was a recognised body under the 1985 Act and that, if the supervisory jurisdiction did not extend to such bodies the appeal must fail. But he later clarified the Appellants' submission which was that MWP also acted as a solicitor.
  73. Mr Holland submitted that the answer to that contention was clear. MWP is a BVI company. A solicitor under the 1974 Act has to be a person: see section 1. A BVI company cannot be admitted as a solicitor or have its name on the roll. There can, therefore, be no question of MWP acting as a solicitor or pretending to be one. It does not come, nor could it be thought to come, within section 20 which prohibits an unqualified person from so acting.
  74. That does not, however, square with section 24 (2) of the 1974 Act which provides that the reference in section 20 to "an unqualified person" and to "a person" both include a reference to a body corporate. The Act thus contemplates that a body corporate may act as a solicitor. (A recognised body is not caught by section 20 or 24 (1) because section 9 (3) of LSA 1987 provides that these sections do not apply to such a body). Further section 24 provides that a body corporate will be guilty of an offence if any act is done by it or by any director, officer or servant of it which is of such a nature or done in such a manner as to be calculated to imply that the body corporate is qualified or recognised by law as a qualified to act as a solicitor.
  75. Accordingly, as it seems to me, although a body corporate is not a solicitor, if it acts as a solicitor or does anything which is calculated to imply that it is a solicitor it commits an offence under section 20 or 24.
  76. The Appellants contend that that is exactly what MWP has done. Although it is a body corporate (as is apparent from the Retainer Letters), it has, they submit, acted as a solicitor by appearing on the record and acting, inter alia, in the manner set out in [9] and [10] above. MWP concedes that, in going on the record, it acted unlawfully either under the 1974 Act or, at any rate, the LSA 2007. In fact, the Appellants contend, MWP's unlawfulness arose both under the 1974 Act, as it initially conceded, and the LSA 2007 (as MWP also accepted: see [150] of the judgment). The Appellants also claim that MWP held itself out to be a body corporate qualified to be a solicitor and thus in breach of section 24.
  77. The question is rendered more complicated by reason of the fact that the printed response packs in use at the time of the acknowledgments of service in [9] and [10] above contain reference to the Defendant's solicitor without any apparent recognition that the acknowledgment may be being made by a recognised body rather than a solicitor. The judge queried [144] whether recognised bodies completing such forms should be taken to use the expression "solicitor" as shorthand for "solicitor or recognised body". For that reason he thought that the offences committed by MWP when it entered these acknowledgments of service might be only under section 14 (1) of the LSA 2007. I do not regard it as necessary to rule on this question now, particularly when the way in which MWP acted or purported to act must be looked at in the light of the totality of the evidence. I entertain however considerable doubt whether, when an entity such as MWP uses forms such as these which characterise it as a solicitor without any qualification, it can escape liability under section 20 or 24, which clearly contemplate that a body corporate can be liable under those sections when it has acted, or purported to act, as a solicitor.
  78. It appears, although I do not now so decide, that Section 21 is not in play on the footing that it only applies to natural persons ("Any unqualified person who …uses any name…implying that he is qualified"), and because section 24 (2) does not apply to it: see also the discussion by the judge at [130] of the cases of Law Society v United Services Bureau Ltd [1934] 1 KB 342 and Pharmaceutical Society v London & Provincial Supply Association 5 App Cas 857, 862.
  79. The disputes overall

  80. As is apparent from the foregoing, there is considerable dispute as to the extent to which MWP has infringed any and, if so, which statute, and as to what proportion of its fees is attributable to its carrying on a reserved legal activity or pretending to be entitled to do so. MWP claims that it charged fees under the July retainer for a large amount of work done in Kazakhstan, London, Moscow, Tashkent and elsewhere, where it was carrying on a coordinating role which did not involve it in acting or purporting to act as a solicitor or recognised body. MWP also relies on the limited territorial reach of the relevant statutes. Insofar as MWP acted outside England & Wales the 1974 Act and the LSA 2007 are inapplicable: see sections 90 (4) and 212 (1) respectively. On ordinary principles the 1985 Act (section 88 of which states that, with immaterial exceptions, it does not apply to Scotland or Northern Ireland) would not apply outside England & Wales.
  81. The Appellants also claim that in the July Retainer and more generally MWP represented that it was a solicitor's firm and that it was acting as, or held itself out to be, a solicitor. MWP says that the July Retainer does not do that and that coming on the record does not amount to that either. There is, it says, no evidence it pretended to be a solicitor. The judge decided that he could not resolve summarily the dispute as to whether MWP so held itself out and, if so, over what time period, for the reasons which he gave [166]. I am unpersuaded that he was wrong to take this view. There is also a dispute as to whether or not MWP was asked not to perform any, or any substantial, work from October 2010 onwards.
  82. I shall assume for the moment that the Appellants are right and that MWP was in breach of both sections 20 and 24 of the 1974 Act. On that hypothesis it might be necessary to determine whether or not the Court's supervisory jurisdiction extends to ordering that MWP shall not be entitled to any (or some part) of its costs; or to ordering some form of assessment of all or some of them.
  83. There appears to be no decided case in which that has ever been done. There may well be good reason for this. A person or body who contravenes section 20 or section 24 (1) commits a criminal offence and cannot recover from his client the price or cost of his illegal acts. In relation to acting as a solicitor section 25 expressly provides that no costs shall be recoverable by an unqualified person (although it is debatable whether that applies to a body corporate: see 131 [2] of the judgment). Where a criminal offence has been committed or section 25 applies the client thus has no need to invoke the Court's inherent jurisdiction (although it might, in some circumstances, be a speedier method of procedure).
  84. I incline to the view (a) that the Court's inherent jurisdiction extends to those who act as, or pretend to be, solicitors when they are not; and (b) that, if so, there is no sound reason why the jurisdiction must be confined to making orders for the return of monies obtained in the character of a solicitor. As to (a) I regard the Court as entitled to proceed on the basis that someone who has falsely claimed to be an officer of the court cannot claim not to be subject to the Court's jurisdiction over its officers because, contrary to his representation, he is not one. I do not regard the enactment of section 25 as ruling out any such jurisdiction, particularly when similar provisions were in force in section 12 of the Attorneys and Solicitors Act 1872. The same applies in respect of section 20 given that similar provisions were enacted in section 45 of the Solicitors Act 1932. It was against that statutory background that the decisions in In re Hulm and In re Hurst & Middleton were reached.
  85. As to (b), if one of the keystones of the doctrine is:
  86. "that the man has, by virtue of his assumption of the position and privilege of a solicitor, either obtained something which he ought not to have obtained … or done some act for which there would be a remedy in the Court if it were an act done by an officer of the Court, and ... the man has done the act or obtained the property by the assumption of the privilege and position of a solicitor"

    then a body corporate which has presumed to act as a solicitor and to charge for so doing, if that is what has been done, should, as it seems to me, come within the ambit of the jurisdiction since he has obtained or sought to obtain something qua solicitor. The jurisdiction is, in essence, one of the Court's creation and its application in those circumstances does not appear to me to exceed the proper bounds of curial creativity.

  87. The judge did not find it necessary to decide this question; and nor do I. I shall assume, for the moment, that the supervisory jurisdiction of the Court is as extensive as is contemplated in the previous paragraph. That begs the question as to whether, on that assumption, the judge was right to stay the claim for arbitration. One of the grounds on which he did so was that he declined to determine summarily the Appellants' argument that "if the principle that no-one can benefit from their own wrongdoing is only a canon of construction, then, as a matter of construction, the arbitration clause is inapplicable to the present dispute between the parties". Accordingly he considered [206] that he should stay the Appellants' claims under the inherent stay jurisdiction in accordance with the decision of this court in JSC "Aeroflot- Russian Airlines" v Berezovsky [2013] EWCA Civ 784 so that the arbitrator could decide the issue of the existence of the arbitration agreement pursuant to section 30 of the 1996 Act.
  88. At the hearing before us the Appellants said that they did not seek to rely on this aspect of the judge's ruling and, in my view, rightly so. I can see no good reason why MWP should be disentitled to rely on the arbitration clause – an agreement separate to that contained in the body of the Retainer – because the Appellants allege that MWP is unable to claim any fees on account of illegality; nor why, as a matter of construction, the clause should be inapplicable. There is nothing illegal about the right to have disputes referred to arbitration and the arbitrator is well able to decide whether the Appellants' illegality points are well founded.
  89. The critical question is whether, on the present assumptions, a stay should have been refused because it would be contrary to the public interest for matters to be decided in the arbitration when they were also part of the subject matter of the Court's supervisory jurisdiction. The Appellants submit that the effect of the stay ordered by the judge is to "bifurcate" the Court's supervisory jurisdiction, so that it is, in effect, partly sub contracted to the arbitrator. If the Court is to exercise that jurisdiction it will need to determine whether MWP has acted unlawfully, which will in part depend on the facts.
  90. Further, the Appellants submit, it is unclear what the judge contemplated would be the status of the arbitrator's decision, once it was reached. What the judge said was this:
  91. "if the active claimants are granted the relief which they seek, it will not be necessary for them to continue to invoke the court's inherent supervisory jurisdiction. To the extent that they are not granted such relief, and consider that nevertheless there is some good basis for continuing to invoke the inherent supervisory jurisdiction, then the court will have the advantage of being able to consider what the arbitrator may have said on relevant aspects. On that basis it seems to me that the claims to relief in paragraphs 5 to 9 should be stayed, as a matter of case management under the inherent stay jurisdiction pending the arbitration."

    It is thus not apparent - the Appellants say - whether the judge contemplated that a decision of the arbitrator would simply be something for the Court to consider; or whether it would be binding in some way, and, if so, on whom.

  92. These are not in my judgment valid objections. There are some circumstances in which a dispute may not be arbitrable. A statutory provision or a rule of public policy may, in rare circumstances, render an arbitration agreement ineffective in so far as it purports to bind the parties to an arbitral determination of the issues sought to be referred. In such a case the arbitration agreement would – per Longmore LJ in Fulham Football Club (1987) Ltd v Richards [2012] Ch 333 [97] – be either "null and void" or, perhaps, "inoperative" within the meaning of section 9 (4) of the 1996 Act.
  93. I can, however, see no valid reason why in this case the public interest should require the arbitrator not to consider the issues that have been referred to him. These are, in essence, the legality of MWP's actions (including whether the Retainers are champertous), the effect of any such illegality on the recoverability of costs and, if relevant, the reasonableness of the costs claimed. These issues are covered by the terms of the arbitration agreements and well within an arbitrator's reach. As the judge rightly held [205] the relief sought (cancellation or an assessment) is not such as to render the claims incapable of arbitration. The fact that the arbitrator cannot exercise the Court's supervisory jurisdiction is no reason to refuse a stay. No one is asking him to exercise that jurisdiction. In any event, the fact that an arbitrator cannot give all the remedies which a Court could give does not afford any reason for treating an arbitration agreement as of no effect: Fulham Football Club [103].
  94. I do not regard the language of bifurcation or other similar expressions as apt. The fact that the consideration by the Court whether to exercise is own jurisdiction might cover some of the same ground as that of the arbitrator does not mean that in staying the claims the Court is ceding to the arbitrator any part of its jurisdiction. The arbitrator is carrying out a function of his own. Prima facie the arbitrator's findings would bind the parties but it may be that the doctrine of issue estoppel (whose operation can be prevented in special circumstances) is inapplicable insofar as the Appellants seek to invoke the Court's own jurisdiction, and, in any event, no decision of the arbitrator can foreclose the decision of the Court itself as to the exercise by it of its jurisdiction.
  95. Mr Diwan, junior counsel for the Appellants, was, therefore, right to accept, as he did, that there was no public policy consideration preventing the arbitrator from addressing the claims referred to him arising under the "ordinary" jurisdiction. That being so the remaining question is whether the judge's decision, by way of case management, was flawed. Insofar as that decision was a matter of discretion we should only interfere with it if the judge has exceeded the permissible bounds of his discretion by ignoring relevant or taking in to account irrelevant factors or being clearly in error.
  96. Discretion

  97. There is nothing, in my view, unsatisfactory, about the Court ordering a stay. I say that for a number of reasons.
  98. First, as the judge pointed out, if the Appellants are successful before the arbitrator, the Court will not need to consider the exercise of any supervisory jurisdiction. If and insofar as they fail before the arbitrator (because MWP is not shown to have acted unlawfully and its fees are held to be recoverable) there is likely to be nothing left for the supervisory jurisdiction to do.
  99. Mr Diwan submitted that an unfair situation might arise if there was an award in being which MWP could enforce in circumstances where the Court might wish (or be persuaded) to consider exercising its own jurisdiction. Even if the Court were to grant injunctive relief this would not necessarily prevent enforcement abroad. This could be unfair. The Court might take a different view as to whether any fees were recoverable or in respect of the period for which they would be.
  100. The better course, he submitted, was for everything to be decided in the one forum, namely the Court, which could decide everything once and for all. He told us that the arbitrator had, before the order of Field J of 19 September 2012 restraining the progress of the arbitration, been adopting a streamlined procedure; that all evidence had been exchanged; the arbitrator had rejected a number of disclosure requests, in particular for MWP's files; and had listed the matter for a 3-4 day hearing. Since the family had indicated that they would not seek to give live evidence, the arbitrator had indicated that most of the issues might be determined on a burden of proof basis. By contrast, he suggested, the Court might wish to go into the matter in more detail with wider disclosure.
  101. It is not apparent to me that matters were put to the judge in these terms. What is apparent from his paragaph [204] is that he did not think that, if the Appellants failed before the arbitrator, they would necessarily seek to invoke the Court's jurisdiction, although he plainly contemplated that as a possibility.
  102. The successful invocation of the Court's supervisory jurisdiction in those circumstances seems to me somewhat remote. It assumes (a) that the Court might be minded to consider the exercise of its residual jurisdiction, if it decides that it has one, in circumstances where an award in favour of MWP has been made and either not appealed or not successfully appealed; (b) that it decides to carry out a further fact finding exercise; and (c) that it reaches a different conclusion. The possibility of this happening is not of much weight in the scales.
  103. In my view the judge was fully entitled to consider it appropriate to await the upshot of the arbitration before determining whether the Court had the jurisdiction claimed and considering whether and how to exercise it. The Court is entitled to manage a case in which its jurisdiction is invoked in whatever way seems to it to be appropriate. That is both an incident of the jurisdiction itself and in any event open to the Court under CPR 3.1.
  104. Second, the resolution of disputes by arbitration was something to which MWP was contractually entitled. There seems to me no good reason for denying MWP that benefit; and good reason for extending it to them since, according to Mr Wilson's evidence, an arbitral award would be enforced in Kazakhstan but not a judgment of the Court.
  105. Third, the case is, on analysis, scarcely one of discretion at all. The argument that MWP is disentitled to rely on the arbitration agreement has fallen away: see [68] above.
  106. There was also a claim that the family is not shown to have entered into the July retainer. This is distinctly unpromising. The Appellants sought permission to serve the SCCO claim on MWP out of the jurisdiction. One of the Orders sought was to set aside the July Retainer. When the claim form was lodged Mr Patrick Beale of Reed Smith LLP, the Appellants' solicitors had filed a witness statement ("Beale 1") dated 15 August 2011 which said that MWP had provided legal services and advice to the claimants pursuant to the July Retainer under which the claim arose. Numerous references were made to the July Retainer in the rest of Beale 1. No suggestion was made that the document had not been agreed between the parties. The request for permission was supported by the 2nd statement of Mr Beale ("Beale 2"), also dated 15 August 2011. Permission was granted and service took place pursuant to it. Beale 2 said that the claimants' claim "arises under the engagement letter dated 2 July 2010 between the parties..." At paras 17 and 18 he relied on the July retainer as bringing the case within the Court's jurisdiction in respect of a contract governed by English law.
  107. Before the Master and the Judge the stance taken in relation to the July Retainer by the family (other than Aidar, who admitted signing it) was that they "could not recall" signing it but were "content to proceed on the basis that [they] did sign [it]": see Sanzhar's 1st witness statement of February 2012, para 5, which was adopted by the other members; and footnote 1 of Mr Beale's 4th witness statement. The footnote asserted that the claimants' position in respect of the application for a stay was without prejudice to their "position as to whether they did or did not sign [the July Retainer]". In a statement of Rejoinder and Reply to Defence to Counterclaim the family (other than Aidar) said that they accepted that they signed the signature page but did not recall doing so and required MWP to prove that they signed a document containing the entire terms of the July Retainer.
  108. I do not regard any contention that the family other than Aidar did not execute the July Retainer as sustainable. It is inherently implausible and inconsistent with the evidence of Mr Wilson, particularly in his 4th witness statement and the exhibits thereto. In my view this evidence, of itself, establishes on the balance of probabilities that the family did execute it. A failure to recall is no evidence to the contrary.
  109. Moreover the claim was served out of the jurisdiction on the faith of statements that the July Retainer was a valid agreement governed by English law. For the purposes of the hearing before the judge it was accepted that the family had signed it. In those circumstances it is not open to the family on appeal to resile from the footing upon which they sought permission to serve out and on which they based their claim; and from which they did not resile below.
  110. In respect of Hawkinson it is said by Aidar (see his witness statement of 20 April 2012) that he had no authority to sign the July Retainer and that he told MWP this. In his judgment in the Jenington action of 15 September 2010 Vos J (as he then was) referred to the defendants' "contention that their company, Hawkinson, gifted 30 per cent of" a particular company. In his affidavit of 3 September 2010 in the Jenington action Aidar deposed to his ownership of 20% of the shares in Hawkinson: see para 10 of the Schedules of Assets both at 29 June and 2 September 2010. I would not regard these matters alone as establishing that Aidar could, by himself, bind Hawkinson. More significantly permission was sought and obtained to serve the claim form, including Hawkinson as a claimant, on the footing that it was party to the July Retainer, which was governed by English law, so that service out was appropriate. In those circumstances it is not open to Hawkinson now to say that it was never a party at all.
  111. Section 9 of the Arbitration Act 1996 provides as follows:
  112. "(1) A party to an arbitration agreement against whom legal proceedings are brought (whether by way of claim or counterclaim) in respect of a matter which under the agreement is to be referred to arbitration may (upon notice to the other parties to the proceedings) apply to the court in which the proceedings have been brought to stay the proceedings so far as they concern that matter.
    (4) On an application under this section the court shall grant a stay unless satisfied that the arbitration agreement is null and void, inoperative, or incapable of being performed."
  113. MWP has established on the balance of probabilities that there is a concluded agreement with all the Appellants which covers the disputes that are the subject of the stay. Accordingly the Court is, as by its Respondent's notice MWP contends, bound to stay those claims unless the Appellants establish that the arbitration agreement is "null and void, inoperative, or incapable of being performed" There is, however, no basis for contending that there is some relevant statutory provision or public policy which means that no stay can be granted with the result that the agreement has any of those characteristics.
  114. Accordingly I would dismiss the appeal save that I would vary paragraph 5 of the order so as to read:
  115. "Any remaining claim in the Amended Claim Form is stayed pursuant to section 9 (4) of the Arbitration Act 1996."

    At present paragraph 5 of the order imposes a stay pursuant to the inherent jurisdiction upon which the judge found it necessary to rely in the light of the argument, no longer maintained, to which I refer at paragraph 63 above.

    Lady Justice Black

  116. I agree with Christopher Clarke LJ that, for the reasons he has given, the appeal should be dismissed save for the variation he set out to paragraph 5 of the order.
  117. As it is not necessary for the purposes of this appeal to decide the difficult question of whether the Court's supervisory jurisdiction extends to those who are not solicitors but act as or pretend to be solicitors, I prefer not to express an opinion about it. I can say, however, that I am inclined to share Christopher Clarke LJ's view (see §48 of his judgment) that the jurisdiction does not extend to bodies corporate which pretend to be recognised bodies.
  118. Lord Justice Aikens

  119. I agree with the judgment of Christopher Clarke LJ.

Note 1   In fact there appear to have been 27. 15 were for work under the July retainer, including one for an engagement fee of US $ 301,000 and another for a success fee of US $ 2,688,042.98. 2 others were for very small amounts and had been paid. 10 were for work under the August retainer. The 10 invoices totalled US $ 713,340.79, of which at least US $ 600,000 had been paid.    [Back]

Note 2   Which by paragraph 22 of Schedule 2 to the 1985 Act applies to a recognised body.    [Back]

Note 3   The Court of Appeal and the House did, however, contemplate that, after the 12 month period, the Court could still investigate professional misconduct based on excessive over charging and, as a step in the determination of any overcharge, refer the bill in question to the taxing master (now costs judge).    [Back]

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