Chong, R (on the application of) v The Law Society

In a professional-conduct investigation, the regulator may investigate and formulate the precise allegation after receiving a complaint, particularly where the complainant does not know the full facts. A complainant’s entitlement to seek review is determined by the policy applicable when the complaint was received or the regulatory file was opened, rather than when the final allegation was formulated. A procedural entitlement existing at that time cannot be retrospectively removed by a later policy change. Deliberately concealing the true purpose of a payment, so that a third party pays money which would otherwise have been refused, is deceitful conduct by a solicitor and may justify disciplinary action even when the solicitor is acting outside legal practice.

The claimant, a solicitor, sought judicial review of the defendant’s Adjudication Panel decision of 14 September 2005. The Panel had allowed a complainant’s review of an adjudicator’s decision, found breaches of Principle 17.01 of the Guide to the Professional Conduct of Solicitors 1999 and Rules 1(a) and (d) of the Solicitors’ Practice Rules 1990, and imposed a severe reprimand.

The underlying complaint concerned payments made by a builder to the claimant, which the claimant passed to a client as a concealed discount. The adjudicator had found no misconduct. The claimant argued that the complainant had no right to appeal because the precise allegation was formulated only after a policy change, and that the Panel’s decision was irrational, inadequately reasoned and unfair.

1. The Panel’s conclusion that the claimant had acted deceitfully was rational and was the only conclusion reasonably open on the undisputed facts. The claimant deliberately led the builder to believe that he was paying a genuine referral fee, while the claimant knew that the payment was intended to secure a discount for the client. The concealment was necessary because disclosure of the true purpose would have caused the builder to refuse payment.

2. Principle 17.01 applied to the claimant’s conduct. The obligation not to act fraudulently or deceitfully applied whether or not the solicitor was acting in a professional capacity. The conduct also fell within the note to Principle 1.08, which required solicitors to behave so as not to bring the profession into disrepute. The Panel was therefore entitled to find breaches of Principle 17.01 and Rules 1(a) and (d) of the Solicitors’ Practice Rules 1990.

3. The complainant was entitled to seek review under the policy in force when the complaint was made and the defendant’s file was opened in February 2004. The later policy change, effective for matters received on or after 2 August 2004, did not remove that existing entitlement. The relevant date was not the date on which the caseworker formulated the precise charge after investigation. Otherwise, a complainant could be prejudiced by delay, evasion or incomplete responses from the solicitor.

4. The Panel was not required to rehearse the factual background in detail. Its decision was addressed to parties familiar with the agenda note, the responses and the adjudicator’s decision. It was sufficient that the Panel resolved the legal and disciplinary consequence of facts which were no longer in dispute.

The application for judicial review was dismissed. The claimant was ordered to pay the defendant’s costs, summarily assessed at £17,500 including VAT.

This was a first-instance judicial review in the Administrative Court. The court dismissed the claim and upheld the Adjudication Panel’s decision.