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You are here: BAILII >> Databases >> England and Wales High Court (Administrative Court) Decisions >> Moseley v Solicitors Regulation Authority [2013] EWHC 2108 (Admin) (28 June 2013) URL: http://www.bailii.org/ew/cases/EWHC/Admin/2013/2108.html Cite as: [2013] EWHC 2108 (Admin)

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

		CO/9915/2012 Royal Courts of Justice Strand London WC2A 2LL
		28 June 2013

1. MR JUSTICE LEWIS: This is an appeal against an order of the Solicitors Disciplinary Tribunal dated 20 August 2012 striking off Mr Robert Lloyd Moseley from the roll of solicitors. Mr Moseley was found guilty of four allegations. In essence, he had been adjudged bankrupt. The four allegations relate to his failure to disclose an interest in property to the official receiver and, thereafter, holding himself out as able to deal in the property and failing to return money that he had received in respect that of property. The fourth allegation was that he had acted in way likely to diminish public trust in the profession. The order of the Solicitors Disciplinary Tribunal was that he be struck off and that he pay costs. He appeals today against the sanction of striking-off alone. He does not appeal against the findings that the allegations were proven. He does not appeal against the costs order.
2. The background is that Mr Moseley was a solicitor. On 7 June 2006 he was made a subject of the bankruptcy order by the High Court of Justice. As a result of that order, the Official Receiver took control of all his assets. He was required to disclose all his assets to the Official Receiver. He was provided with and acknowledged receipt of guidance relating to the obligation to disclose his assets. Mr Moseley did provide details of most of his assets. He did not, however, disclose that he had a reversionary interest in property at 29 Caribel Road, London. It seems that had been acquired as part of a business venture with his former partner and his partner was largely responsible for the transaction. At the time that Mr Moseley initially provided details of his assets to the Official Receiver, he was either unaware that he owned a reversionary interest or he had forgotten about it.
3. In any event, however, in January 2010, two people approached Mr Moseley proposing to purchase the freehold reversion. At that date he became aware of his interest in the property. It was his duty to inform the Official Receiver of that interest. He did not do so. Instead, he agreed to sell the reversionary interest to the two people who had approached him. Solicitors were instructed on both sides. Completion was due on 14 May 2010. The purchasers' solicitors had made a search of the land registry on 9 April 2010. On 14 May 2010 funds in the amount of £12,233.98 were transferred to the respondent's solicitors. That comprised a sum of roughly £10,200 for the purchase price and the remainder comprised ground rent and legal fees.
4. However, on 15 June 2010, when the purchaser's solicitors tried to register the transfer of title at the Land Registry, they were unable to do so. It seems what had happened was that the purchasers had in fact contacted the Official Receiver to ask about purchasing the freehold. At that stage the Official Receiver entered a restriction in the Land Registry and that prevented the transaction proceeding. The purchasers were therefore not able to obtain title to the property but they had already paid the purchase price. They sought to recover the money from Mr Moseley. Mr Moseley had in fact used the money to pay off other debts that he had accumulated. He did not return the money to the purchasers. He has still not returned any money to the purchasers. He did not submit the money to the Official Receiver. As I say, he used it to pay off other debts that he had incurred.
5. Mr Moseley was made the subject of four allegations. In summary, the first allegation was that he had failed to disclose to the Official Receiver, during or after the bankruptcy, his ownership of the free-holding reversionary interest. The second allegation was that he had held himself out or caused to allowed himself to be held out as capable of transferring the interest in the property. The third allegation was that he failed to repay sums paid to him in respect of the proposed transfer. The fourth allegation was that he had acted in a way likely to diminish public trust in the profession.
6. There was a hearing before the Solicitors Disciplinary Tribunal in early July 2012. Mr Moseley represented himself at that hearing. Prior to the hearing he did not admit any of the four allegations. During his evidence to the tribunal he effectively admitted the first three allegations but he continued to deny the fourth allegation. He continued to deny that he had acted in a way that lacked integrity or in a way that was likely to diminish public trust in the profession.
7. The tribunal issued a carefully reasoned judgment which should be read in its entirety. At paragraph 19 they noted that this matter concerned a transaction which did not occur during the course of the respondent's legal practice. They also confirmed that there was no allegation of dishonesty against Mr Moseley. At paragraph 24 they recited the evidence that they had heard from Mr Moseley and that included the explanation that he was unaware that he owned the reversion of the property. Then in paragraph 25 the tribunal recorded that there came a time when two people approached him to purchase the freehold and they note that Mr Moseley accepted that he had not reverted to the Official Receiver to inform him of his interest in the property, that Mr Moseley now accepted that he should have obtained consent from the Official Receiver before proceeding and the respondent now accepted that he was at fault and should have checked the position.
8. At paragraph 26 the tribunal records that whilst the respondent accepted he was at fault for not making his own enquiries he did not accept that he had acted with a lack of integrity. His case was that he contacted his own solicitors to find out whether he was able to transfer the interest in the property and he had told the prospective purchasers to seek independent advice and his case was that everyone had been aware of the position and he had not acted with a lack of integrity.
9. The tribunal found each of the four allegations found. They dealt with each of them in turn. In relation to the first allegation, at paragraph 30.2 of the judgment, the tribunal says this:

"Whilst the tribunal accepted that the respondent may not have been aware of his interest in the property at the time of the bankruptcy it was clear had this position changed in January/February 2010 when he was informed by Miss ZB of his interest. At that time the respondent became aware of his reversionary interest in the property and, especially as a solicitor, the respondent had a duty to disclose his interest in this property to the Official Receiver's office, particularly in view of the fact that he had already disclosed a number of properties to them. It was not credible for the respondent to say that he had not addressed his mind to this point and indeed the respondent had accepted in his evidence that he should have reverted to the Official Receiver when he found out he owned the property."

10. The tribunal then dealt with the second allegation and found that that, too, was proven. The tribunal dealt with the third allegation and found that, too, was proven. In relation to the fourth allegation the tribunal noted that Mr Moseley disputed the allegation and maintained that he had not acted with a lack of integrity and his behaviour had not diminished the trust the public placed in the profession. The tribunal said this:

"The tribunal rejected the respondent's version of events and his assertion that he had not been informed by lawyers that he should not transfer his interests in the property and therefore knew no different."

At paragraph 33.2, the tribunal said this:

"Although Miss ZB and respondent solicitor appeared to be aware of the position, this did not allow the respondent to abrogate complete responsibility to the lawyers regarding whether he was in position to deal with this property, particularly in view of his knowledge that he had been declared bankrupt in the past. Any prudent solicitor would have taken steps to make their own enquiries with the Official Receiver or the trustee in bankruptcy before proceeding with any such transaction. The respondent has maintained throughout his evidence that he had solicitors acting for him and that the purchasers also has solicitors acting for them and, therefore, there was no duty on the respondent to disclose matters to the Official Receivers office. The tribunal rejected this and was satisfied that the respondent had acted with a lack of integrity. The respondent had not repaid the funds to either the purchasers or the Official Receivers office despite being asked to do so. Indeed, he stated he had used the funds to pay off debts which he had incurred on top of his bankruptcy debt. The respondent had received money that he was not entitled to and he had used that money to pay unsecured circumstances. In the circumstances, the tribunal were satisfied the respondent had acted with a lack of integrity and in a way likely to diminish public trust in the profession."

11. The tribunal then dealt in general terms with disciplinary matters previously before the tribunal and with mitigation. The tribunal noted that Mr Moseley had already provided much of his mitigation during his evidence.
12. At paragraphs 37 and following the tribunal turned to sanction. The tribunal said this:

"37. The tribunal had considered carefully the respondent's submissions of evidence. The tribunal had found all the allegations proved and had rejected the respondent's version of events as these flew in the face of the facts as proved. The tribunal was of the view that the respondent had taken advantage of the mistake made by the purchaser's solicitors and then had dispersed the money paid to him when he should have known that he should not do so. He disregarded the written directions supplied to him immediately following the Bankruptcy Order made against him. Two years had passed since the monies have been paid to the Respondent and, despite several requests for repayment, the money had not been repaid. This was disgraceful conduct.

38. The respondent had shown a great lack of integrity. Having become aware that he had an interest in a property, he had failed to declare that interest to the Official Receiver's office, he had allowed the property to be transferred to a third party, he had accepted funds which had been paid to him and he had then used those funds to pay off other unsecured debts, maintaining that, as both parties had been represented by lawyers, there had been no duty on him to disclose matters to the Official Receiver's office and no reason for him to believe he could not use those funds. As a result of the respondent's conduct the purchasers had lost money and the respondent had unlawfully benefited."

The tribunal then referred to case of Bolton v Law Society, and I shall return to that case shortly, and the tribunal concluded by saying this:

"The respondent's conduct has caused a great deal of damage to the reputation of the profession and the tribunal is of the view that he was a risk to the public. The tribunal decided the appropriate sanction was for the respondent to be struck off the roll of solicitors."

13. Against that finding there are four grounds of appeal. In summary, the first ground is that the punishment was too severe. The second is an allegation of procedural unfairness on the part of the tribunal. The third is that the tribunal placed undue weight on the fact that the appellant had not repaid the sum which had been transferred to him. The fourth ground was that the tribunal had placed no or insufficient weight on the appellant's personal and professional circumstances.
14. I turn next to the legal framework. Section 46 of the Solicitors Act 1974 provides for complaints to be dealt with by a tribunal known as the Solicitors Disciplinary Tribunal. That tribunal is to consist of practising solicitors of not less than a certain number of years' standing and also of lay members. Section 47 provides for the sanctions that the tribunal may impose. Those sanctions include, amongst others, striking a solicitor off the roll, and suspension. Regulations have been made under the Act. They are the Solicitors (Disciplinary Proceedings) Rules 2007. Rule 16 deals with the procedure for hearings and findings. Rule 16 (3) and (4) provide as follows:

"3. At the conclusion of the hearing the tribunal shall make a finding as to whether any or all of the allegations in the application have been substantiated whereupon a clerk should inform the tribunal whether, in any previous disciplinary proceedings before the tribunal, allegation were found to have been substantiated before the respondent.

4. The respondent shall be entitled to make submissions by way of mitigation in respect of any sanction including any order for costs which the tribunal may impose."

15. The approach to disciplinary matters on the part of solicitors is set out in the case of Bolton v Law Society [1994] 1 WLR page 512. Sir Thomas Bingham, Master of the Rolls as he then was, set out a summary of the general principles applicable, and I shall summarise those very briefly. First, as appears from page 518 there is emphasis on the importance of maintaining integrity, prohibity and trustworthiness on the part of solicitors. As the Master of the Rolls said:

"Any solicitor who is shown to have discharged his professional duties with anything less than complete integrity, probity and trustworthiness must expect severe sanctions to be imposed upon him by the Solicitors Disciplinary Tribunal. Lapses from the required high standard may, of course, take different forms and be of varying degrees. The most serious involves proven dishonesty, whether or not leading to criminal proceedings and criminal penalties. In such cases the Tribunal has almost invariably, no matter how strong the mitigation advanced for the solicitor, ordered that he be struck off the Roll of Solicitors. Only infrequently, particularly in recent years, has it been willing to order the restoration to the Roll of a solicitor against whom serious dishonesty had been established, even after a passage of years, and even where the solicitor had made every effort to re-establish himself and redeem his reputation. If a solicitor is not shown to have acted dishonestly, but is shown to have fallen below the required standards of integrity, probity and trustworthiness, his lapse is less serious but it remains very serious indeed in a member of a profession whose reputation depends upon trust. A striking off order will not necessarily follow in such a case, but it may well. The decision whether to strike off or to suspend will often involve a fine and difficult exercise of judgment, to be made by the Tribunal as an informed and expert body on all the facts of the case."

16. The second principle to bear in mind is that, in most cases, the order of the tribunal is not intended to be punitive, although it may be so. Rather, in most cases, the order will seek to achieve one of two purposes. One is to ensure that the offender does not have the opportunity to repeat the offence. The second purpose, described as the most fundamental of all, is "to maintain the reputation of the solicitors' profession as one in which every member of whatever standing may be trusted to the ends of the earth. To maintain his reputation and sustain public confidence in the integrity of the profession, it is often necessary that those guilty of serious lapses are not only expelled but denied readmission".
17. The third general principle which to which this case refers is this. As orders made by the tribunal are not primarily punitive, it follows that considerations which would ordinarily weigh in mitigation have less effect on the exercise of this jurisdiction than it would in other cases. Finally, I bear in mind that the Court drew attention to the fact that the Solicitors Disciplinary Tribunal is an expert tribunal whose membership includes experienced members of the profession. Great respect should be given to their judgment as to what is necessary to maintain professional standards and public confidence in the profession. I accept of course that it is open to the court on appeal to impose a different and lesser penalty if it considered it appropriate to do so, but in general terms one ought to pay considerable respect to the sentencing decisions of the tribunal. That approach is confirmed more recently in the case of Salsbury v Law Society [2008] EWCA Civ 1285.
18. Against that background I turn to the four grounds of appeal. I can deal with grounds one, three and four together. Ground one, as explained in the skeleton and oral submission this morning, is this. If the conduct in question is unconnected with the discharge of professional duties by the solicitor, then striking off the roll will only be appropriate if either there is proven dishonesty or a serious offence unless there are exceptional circumstances. In the present case, says Mr Ramsden on behalf of Mr Moseley, there was no dishonesty or serious offence and there are no exceptional circumstances present here.
19. In my judgment there is no requirement or presumption that, if the conduct is independent of the discharge of professional duties, then it must involve either dishonesty or a serious criminal offence, or that there be exceptional circumstances before striking off is appropriate. Rather, where the conduct complained of is found to involve a lack of integrity and diminishes public trust in the profession it may still, depending on the particular facts, be appropriate to impose the sanction of striking off the roll. Where conduct is dishonest or criminal, it is very likely that that would be the result. But even where conduct is not dishonest or criminal and even if it is unconnected the discharge of professional duties, it may justify striking off where it involves a lack of integrity or results in a diminution in the public trust in the profession.
20. That is what the Court of Appeal said in Bolton. I accept that in that case the Master of the Rolls was referring to conduct which did occur in the course of a solicitors profession. In my judgment that reflects the facts of the case where the allegations did arise out of the way in which the solicitor in question discharged his professional duties. But in my judgment, if the conduct is unconnected with professional duties but is still conduct which involves a lack of integrity and undermines public confidence in the profession, the observations of the Master of the Rolls in Bolton still apply.
21. In the present case it is clear from paragraph 19 that the tribunal were well aware that the conduct did not arise in connection with the course of Mr Moseley's practice. They were well aware that there was no allegation of dishonesty. However, the fact is that Mr Moseley did not disclose an interest in property to the Official Receiver as he was required to do. He held himself out as being able to deal with that property when he could not deal with that property. Then, having obtained money that he was not entitled to obtain he used it to pay debts and failed to return the money to the purchasers. The tribunal describes this as "disgraceful conduct" and involving "a great lack of integrity". I agree. In my judgment the sanction of striking-off is the appropriate sanction for the conduct that occurred in this case. I would in any event have paid great respect to the decision of an expert specialist tribunal, particularly on matters such as the appropriate sanction for conduct in cases like the present. But, as I say, I am satisfied that the decision of the tribunal is within the range of responses reasonably open to it and, furthermore, in my judgment, the sanction they imposed was the appropriate one on the facts of this case.
22. Against that background I do not need to deal in detail with the various points that have been put in the skeleton arguments and in oral arguments. I simply deal with some of the principal points. First, it is said in the skeleton argument that that case did not involve any personal enrichment on the part of Mr Moseley. It is said there was not here large scale financial impropriety pursued in order to fund a lavish lifestyle. It is said there was no direct personal gain here.
23. First, in my judgment, those submissions do not address the central issue in this case. The conduct complained of is that what Mr Moseley did was disgraceful and lacking in integrity and undermined public confidence in the profession. Striking off is appropriate given those circumstances.
24. Secondly, there was in any event, in my judgment, an element of personal enrichment and an element of gain. Mr Moseley did not repay the money. He was not entitled to the money but he in fact used it to discharge debts that he had incurred and which he would have continued to owe if he had not used the money. In paragraph 19 of the skeleton it is said that there were additional mitigating factors in the present case. It is said, for example, that the appellant, Mr Moseley, was unrepresented before the tribunal and if he had been represented he would have admitted the allegations early on and he would have got some credit for doing so.
25. First, the tribunal must proceed on the facts and circumstances as they are in front of them. The facts were that Mr Moseley did not admit the three allegations until this hearing. He still did not admit the fourth allegation. In my judgment, the fact that he was unrepresented and might have made admissions if he had been represented does not assist him in the present case. Indeed, so far as the facts are concerned in relation to allegations one to three it is difficult to see why having a solicitor would be relevant at all. On the facts it is clear, it seems, and Mr Moseley accepted in his evidence, that he had done the things that he is alleged to have done.
26. So far as the fourth allegation is concerned, the fact that Mr Moseley, even though he is a solicitor, could not see throughout the whole of the tribunal hearing that his conduct was disgraceful and lacking in integrity and might have benefitted from having a lawyer to advise him, does not amount in my judgment to a mitigating factor.
27. Dealing with ground three, it is said that the tribunal placed undue weight on the fact that Mr Moseley had not repaid the sums. In reality, the position is that Mr Moseley did not disclose an interest in property when he should have disclosed it. He held himself out as being able to deal with property when he was not able to deal with property. Having received money to which he was not entitled he used it to discharge his debts and he has failed to repay that money to the people who are entitled to it. It is all those facts taken together which, in my judgment, make it clear that the appropriate sanction was striking off.
28. Furthermore, there is reference in the skeleton to the fact that Mr Moseley's business affairs were in disarray at the time. This in my judgment does not begin to explain, let alone excuse, what happened. Next, there is a suggestion that the sum did not represent such a substantial windfall that failure to repay made it justified to impose an order of striking off. The point is, as I have said repeatedly, he failed to disclose an interest in property, he held himself out as being able to transact in relation to the property, then when the money was received he spent it and he has not paid it back. It was the purchasers' money, or it should have gone to the Official Receiver. Mr Moseley should not have paid it out to others. It is the lack of integrity in the way in which Mr Moseley conducted himself which justifies the sanctions and it is the effect on public confidence and the undermining of public confidence which justifies the sanction. In my judgment, ground three is not made out.
29. Ground four concerned the fact that the tribunal had placed no or insufficient weight in relation to certain matters of personal mitigation. First, the tribunal knew all the facts and, as will appear shortly in my judgment, they had given Mr Moseley the opportunity to address his position and they refer to that in their judgment. Secondly, as the case of Bolton explains, personal mitigation often weighs less in the balance in these cases because one is primarily concerned with maintaining confidence in the profession. In my judgment, ground four is not made out.
30. I then turn to ground two and the allegation of procedural unfairness on the part of the tribunal. What Mr Moseley says is this. There is no general rule that the tribunal has to indicate to a party before it what sanction they have in mind. However, in the present case, it was unfair for the tribunal not to do so. The tribunal should have told Mr Moseley that striking off was the sentence they were minded to impose and should have invited him to address submissions on that.
31. The reason why Mr Moseley says they should have done that is, first, he was unrepresented and, secondly, the sentence here related to an offence where there was a range or degree of culpability and he says the tribunal should have expressed their views on where on that range the offence lay. They should have indicated the view they had of the gravity of the offence so he could have been made aware of it.
32. In my judgment, the position is this. First, as Mr Moseley accepts, as a general rule, a tribunal is not obliged to say what sanction they have in mind and to invite specific submissions on that possible sanction. Second, there are rules in place for this tribunal which govern procedure. Rule 16 requires that the clerk inform the tribunal whether there had been any previous disciplinary proceedings before the tribunal which involved allegations substantiated against the respondent and the rules also provide, "the respondent shall be entitled to make submissions by way of mitigation in respect of any sanction including any order for costs which the tribunal may impose". If those rules are followed, one can expect that they will ensure fairness for the solicitor involved. That will be the case whether the solicitor is represented or unrepresented. Third, the rules were followed here as appears from the transcript of the hearing. The tribunal retired after hearing the evidence. They came back. They announced their findings in relation to each of the allegations and then they were informed by the clerk that there were previous disciplinary proceedings and the tribunal said this, "Would you like to address us in mitigation? Firstly, generally, and, secondly, regarding these findings?" Mr Moseley dealt with the earlier findings against him and those were relatively insignificant in the circumstances. Secondly, having done that, he was asked again if he had any personal mitigation and he put forward his personal circumstances. Thirdly, at the end he was asked, "Do you want to ask anything", and he did not.
33. In my judgment, assessing what happened here in the context of a solicitor attending a disciplinary hearing, the procedure accorded with the rules and was fair. Mr Moseley was given every opportunity to make submissions by way of mitigation. Or, if he was uncertain, he was given the opportunity to ask anything. As I have indicated, the fact that the solicitor is unrepresented does not mean that the tribunal must tell him of the sanction that it has in mind or its view of the degree of gravity of the conduct in question. Furthermore, I do not consider that the fact that the offence potentially covers a range of culpability, some instances of which might justify striking off and some of which might not, means that the tribunal must tell the solicitor where on the scale they think the conduct falls and whether or not striking off is a possibility. In my judgment where the solicitor is given a full opportunity to put forward his mitigation, that is sufficient in general to ensure fairness. It was sufficient in the circumstances of this case to ensure that Mr Moseley was treated fairly. This ground of appeal also fails. In the circumstances, therefore, this appeal is dismissed.
34. MR BENNETT: My Lord, I make an application for costs. The appellant's have received a schedule of costs.
35. MR JUSTICE LEWIS: Yes.
36. MR BENNETT: Does my Lord have a copy of our schedule?
37. MR JUSTICE LEWIS: No I think I had one from the claimants, I don't think I had one from you.
38. MR BENNETT: I will hand that up. (Handed).
39. MR RAMSDEN: My Lord, to save time there is no issue of course as to the principle of costs. My Lord will see from the two competing schedules that they are quite similar but they are different in their components because the make-up of costs differs. The disbursements are rather higher on our side and rather less so on the SRA side. In the circumstances, because my Lord is exercising a summary on rough and ready jurisdiction on summary assessment, we do not make any points in relation to quantum.
40. MR JUSTICE LEWIS: So you accept that as matter of principle you should pay the costs and you don't object to the amount that is £8,904.60. In that case the order will be, one, this appeal is dismissed, two, the appellant to pay the respondent's costs, those costs being summarily assessed in the sum of £8,904.60.
41. MR BENNETT: I'm grateful, my Lord.
42. MR JUSTICE LEWIS: Are there any other matters?
43. MR RAMSDEN: My Lord, no.
44. MR BENNETT: No, my Lord.
45. MR JUSTICE LEWIS: Thank you very much and thank you for calling me back it was quite the right thing to do.
46. MR BENNETT: Thank you, my Lord.