Shaw v Solicitors Regulation Authority, Court of Appeal - Administrative Court, August 07, 2017, [2017] EWHC 2076 (Admin)

Issuing Organization:Administrative Court
Actores:Shaw v Solicitors Regulation Authority
Resolution Date:August 07, 2017
 
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Case No: CO/5459/2016

Neutral Citation Number: [2017] EWHC 2076 (Admin)

IN THE HIGH COURT OF JUSTICE

QUEEN'S BENCH DIVISION

ADMINISTRATIVE COURT

Royal Courts of Justice

Strand, London, WC2A 2LL

Date: 07/08/2017

Before :

THE HONOURABLE MRS JUSTICE CARR DBE

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Between :

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Mr Timothy Dutton CBE QC (instructed by Mayer Brown International LLP) for the Appellant

Mr Mark Cunningham QC (instructed by the Solicitors Regulation Authority) for the Respondent

Hearing date: 27 July 2017

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JUDGMENTMrs Justice Carr :

Introduction

  1. This an appeal by the Appellant, Mr Andrew Shaw, (``Mr Shaw''), pursuant to s. 49 of the Solicitors Act 1974 against the decision of a constitution (``the Tribunal'') of the Solicitors' Disciplinary Tribunal (``the SDT'') on 2nd September 2016 to strike him off the Roll of Solicitors (``the Roll''). The Tribunal gave its full reasons in a written judgment (running to 68 pages and 164 paragraphs) dated 6th October 2016 (``the sanctions judgment''). Mr Shaw contends that the sanction of striking-off should be overturned and substituted by a limited period of suspension running from 13th February 2013.

  2. Mr Shaw had been admitted as a solicitor in 1981 and had a previously unblemished professional record. He is now 61 years of age. He was struck off in relation to a finding of dishonesty (``the finding of dishonesty'') in relation to the contents of an affidavit (``the Affidavit'') sworn by him and filed on behalf of his client, the Complete Retreats Liquidating Trust (``the Liquidating Trust''), in proceedings in the Chancery Division brought by the Liquidating Trust against a Mr Geoffrey Logue (``Mr Logue'') (Case No. HC10C01447) (``the Chancery proceedings''). At the material time Mr Shaw was a partner in the commercial litigation department of Stewarts Law LLP (``Stewarts''), a position he had held since 2009.

    Procedural background

  3. The matter has a chequered and protracted procedural history. The disciplinary proceedings were commenced on 25th May 2012 against Mr Shaw (as first respondent) and a junior associate at Stewarts, a Mr Turnbull (as second respondent) (together ``the Respondents''), by Mr Logue acting as a private prosecutor. The original hearing took place between 4th and 11th February 2013. The (first) Tribunal announced its decision to strike Mr Shaw off on 14th February 2013. It made multiple findings of dishonesty against Mr Shaw, including the finding of dishonesty. Its written reasons followed on 29th April 2013. In relation to sanction it said this (at paragraph 169):

    ``The Tribunal had regard to its own Guidance Note on Sanctions when deciding the appropriate penalty in this matter. The First Respondent had engaged in a dishonest course of conduct which had continued over a period of time. There had been a number of serious failings on his part in bringing material and relevant considerations before the Court and he had deliberately misled the court when his duty, as an officer of the Court, was to give full and frank disclosure. There were no exceptional circumstances, such as those identified in Sharma, which would justify a sanction other than a striking off. In order to protect the public and maintain the reputation of the profession, the only appropriate sanction in the case was that the First Respondent should be struck off the Roll and the Tribunal so ordered.''

  4. On 1st March 2013 Mr Shaw appealed against the substantive findings against him to the High Court, which appeal was heard before Jay J in December 2013 with judgment being handed down on 13th January 2014 ([2014] EWHC 5 (Admin) (``the Jay judgment'').

  5. Jay J concluded that the (first) Tribunal's conclusions were not unsustainable or plainly wrong. However, they were inadequately reasoned save in respect of the finding of dishonesty (and a finding of reckless disregard on the part of Mr Shaw in relation to the misuse of confidential information). To this extent, the appeal was allowed. The matter was remitted to the SDT for sanction purposes, on the basis that Jay J concluded (at [279]) that he could not ``be satisfied to the requisite standard of confidence that striking off [was] inevitable: a reasonable SDT could appropriately impose a lesser sanction, taking into account relevant guidance and authority''. He stated in terms (at [281]) that he was not to be taken as expressing any view on Mr Shaw's prospects of success in avoiding striking off. In the meantime, Mr Shaw was restored to the Roll, although by this stage his partnership at Stewarts had terminated and his practising certificate expired.

  6. On 31st January 2014 Mr Shaw lodged an appeal in relation to the upholding of the finding of dishonesty and Mr Logue lodged an appeal against the decision to restore Mr Shaw to the Roll. Both applications for permission were refused on the papers and were renewed for oral hearing. On 10th July 2014 Maurice Kay LJ indicated that he was provisionally minded to list the applications for permission, with appeals to follow immediately if permissions were granted.

  7. The next day, on 11th July 2014, Mr Shaw entered a settlement agreement with Mr Logue as a result of which he agreed not to pursue his complaint against Mr Shaw further. Mr Shaw's solicitors informed the Solicitors Regulation Authority (``the SRA'') of this development on 18th July 2014, as did Mr Logue's solicitors also (on or about 16th July 2014).

  8. On 10th December 2014 the SRA indicated that it intended to apply to be substituted as applicant and to pursue the dishonesty finding. It made such an application on 20th March 2015, to which Mr Shaw did not object. A (second) Tribunal made the substitution on 29th April 2015. By this stage Mr Shaw had submitted a witness statement in mitigation (``the mitigation statement''). The SRA objected to its admissibility. At a case management hearing on 23rd February 2016 a (third) Tribunal (that included the chairman and one panel member of the (ultimate) Tribunal) ruled that the mitigation statement was admissible, since ``it might put the dishonesty of the Respondents in context''. The sanctions hearing was listed for and took place on 9th and 10th August 2016 before the Tribunal. The decision to strike off was announced on 2nd September 2016, followed by written judgment on 6th October 2016. Again, and for a second time, it was found that there were no exceptional circumstances such that Mr Shaw (or Mr Turnbull) should not be struck off the Roll for dishonesty.

  9. Mr Turnbull has not appealed against the order striking him off the Roll.

    A summary of the main factual background

  10. A very helpful exposé of the essential background can be found in the judgment of Roth J referred to below ([2010] EWHC 1864 (Ch)) (``the Roth judgment''). Additionally, a detailed chronology is appended to the Jay judgment.

  11. For present purposes, the following summary will suffice. Mr Logue was employed by an American group of companies known as ``the Retreats Group'' between 2002 and 2005. In January 2005 he left the Retreats Group, with a payment of US$3.65million. Proceedings in Missouri and New York later that year resulted in a settlement agreement between Mr Logue and the Retreats Group in September 2005 whereby the Retreats Group gave up rights to certain properties and made a further payment to Mr Logue.

  12. In July 2006 the Retreats Group filed for bankruptcy in the United States (under chapter 11 of the US Bankruptcy Code) and the Liquidating Trust was set up to liquidate and ultimately distribute its assets.

  13. In July 2008 the Liquidating Trust commenced Connecticut proceedings against Mr Logue to recover the payments and properties transferred in January and September 2005. Attempts were made to serve Mr Logue in New York, but Mr Logue stated that they did not come to his attention at the time. He had moved out of his New York apartment (``the New York apartment'') in April 2009. In July 2009 the equivalent of a default judgment on liability in English law was entered against him. A quantification hearing was set for 5th May 2010 by which time the Liquidating Trust was required to file and serve evidence on quantum (by 29th April 2010).

  14. Mr Shaw and Mr Turnbull at Stewarts were retained to advise the Liquidating Trust first on obtaining a post-judgment freezing order against Mr Logue's assets in England, and then on obtaining a pre-judgment freezing order (after the Liquidating Trust had been ordered to serve its quantum evidence on Mr Logue by 29th April 2010).

  15. In April 2010 steps were taken in both the United States and England to locate and serve Mr Logue. Documents were sent by post to the New York apartment (where, as set out above, in fact Mr Logue no longer lived) and attempts were made to effect personal service there as well. On 12th April 2010 the process server, Mr Sy Kahn (``Mr Kahn''), sent an email to the Liquidating Trust's United States attorney, Mr Jeffrey Wiesner (``Mr Wiesner'') as follows:

    ``Fri eve around 7pm I spoke with the doorman who seemed sincere - no games and said what's that name again and was not familiar with him. He asked for apt. no, which I gave him but after looking at his tenant list said not known. I've checked the tel. Directory and called a number for him (212 744-2053) but it is no longer in service.''

    (``the Kahn email''). The Kahn email was forwarded to Mr Shaw and Mr Turnbull that same day.

  16. A private investigator in England then located Mr Logue and made contact with him by telephone, but was unable to effect personal service.

  17. In late April 2010 the Liquidating Trust, acting by Stewarts, made the application for a freezing order. It was heard on a without notice basis by Morgan J on 29th April 2010 - as indicated above, the day for service on Mr Logue of the Liquidating Trust's quantum evidence. Affidavits from Mr Shaw, Mr Wiesner and another US attorney were relied upon. In...

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