Law Society v Wheeler & Anor

Permission to employ a struck-off solicitor subject to strict supervision creates a continuing obligation. Administrative changes to the employee’s location, duties or working arrangements do not weaken that obligation unless the conditions are formally varied. A Law Society inspection or correspondence that does not expressly approve altered conditions does not amount to such variation.

A failure to provide strict supervision breaches Solicitors Act 1974, section 41, and may constitute conduct unbefitting a solicitor even where the employee’s fraud could not have been prevented by closer supervision. Where the breach falls within section 41(4), suspension is mandatory and a lesser penalty is unavailable.

The Law Society appealed under Part III of the Solicitors Act 1974 against a decision of the Solicitors Disciplinary Tribunal filed on 25 August 2004. The Tribunal found a breach of the conditions governing the respondents’ employment of a struck-off solicitor, but dismissed the allegation that the breach amounted to conduct unbefitting a solicitor. It separately found inadequate supervision and imposed fines and costs orders.

The Law Society contended that the Tribunal’s findings were inconsistent, that the section 41 allegation was proved, and that the penalty was inadequate. Mr Wheeler argued that the proceedings were an abuse of process and that the supervision provided was sufficient. The central issues were whether the section 41 conditions remained binding, whether strict supervision had been provided, and what penalty followed.

1. The appeal was allowed to the extent indicated, and the cross-appeal was dismissed. The Tribunal’s dismissal of the section 41 allegation could not stand because its reasoning was internally inconsistent with its findings concerning supervision.
2. The obligation to provide strict supervision was not weakened by the 1997 inspection, subsequent correspondence, the relocation to separate premises, or the Law Society’s failure to object at an earlier stage. None of those matters amounted to an approval or variation of the conditions.
3. Strict supervision had not been provided. The employee had operated from separate premises, with separate communication facilities and staff, and had conducted matters with insufficient scrutiny. Complaints concerning the Tipping estate should have prompted a careful investigation. The later review of the file demonstrated that the supervision had been inadequate.
4. The failure to provide strict supervision breached the respondents’ obligations under section 41 of the Solicitors Act 1974 and, in the circumstances, constituted conduct unbefitting a solicitor. There was no proper distinction between the Tribunal’s findings on the section 41 allegation and its finding of inadequate supervision.
5. Under section 41(4), a meaningful breach required at least a period of suspension. The good record, personal honesty and co-operation of Mr Wheeler were relevant mitigation, but could not eliminate the statutory minimum consequence. The court imposed a 28-day suspension for the section 41 allegation, no separate penalty for the supervision allegation, and a £500 fine for the admitted accounts allegation. The existing costs order was maintained.

• High Court (Administrative Court): The court allowed the Law Society’s appeal to the stated extent, substituted a 28-day suspension and other penalties, and dismissed Mr Wheeler’s cross-appeal.
• Solicitors Disciplinary Tribunal: Decision filed on 25 August 2004. The Tribunal found inadequate supervision, but dismissed the allegation that breach of the section 41 conditions amounted to conduct unbefitting a solicitor.