The Law House Ltd v Adams

Imprisonment for civil contempt is a last resort. The court must consider whether custody is necessary, the shortest appropriate term, and whether imprisonment should be suspended. Breaches of freezing orders and associated disclosure obligations are ordinarily serious because they undermine the administration of justice. The court should assess culpability and prejudice, together with pressure, responsibility, co-operation, remorse, apology, mitigation and any reasonable excuse. A fine must not be replaced by imprisonment merely because the contemnor cannot pay it. Deliberate, repeated and misleading breaches by a solicitor who understood the orders may justify immediate, unsuspended custody, even where the claimant’s ultimate recovery has not been substantially reduced.

The claimants applied to commit the defendant to prison for contempt of court. The charges concerned admitted breaches of several High Court orders requiring disclosure of information and imposing freezing restraints over assets. The defendant had repeatedly missed deadlines, provided misleading information, failed to disclose assets and dealt with frozen money. The application had been adjourned several times, including to permit medical evidence concerning her ability to engage with the proceedings.

The court determined whether the charges were proved and, if so, the appropriate sanction, including the significance of the defendant’s culpability, remorse, medical condition, personal circumstances, the Covid-19 pandemic and the absence of substantial unrecovered assets.

1. The court was satisfied to the criminal standard that each charge in the re-amended charge sheet was established. The defendant had admitted all the charges.

2. The power to sentence for civil contempt arose from the court’s inherent jurisdiction, subject to section 14(1) of the Contempt of Court Act 1981. The maximum sentence on any one occasion was two years’ imprisonment. Under section 258 of the Criminal Justice Act 2003, unconditional release was available after half the sentence.

3. A custodial sentence was a measure of last resort. The court adopted and applied the framework summarised in Asia Islamic Trade Finance Fund Ltd v Drum Risk Management Ltd [2015] EWHC 3748 (Comm). It considered whether committal was necessary, the shortest necessary term, suspension, the punitive and coercive functions of contempt sanctions, and the factors affecting seriousness.

4. The relevant aggravating features were substantial. The defendant breached five orders, understood their requirements and penal notices, repeatedly treated deadlines as optional, failed to co-operate, and deliberately supplied false or misleading information. Breaches of freezing orders and their disclosure provisions constituted a serious attack on the administration of justice. Her status as a solicitor and former officer of the court increased the seriousness.

5. The court considered mitigation, including the defendant’s lack of criminal convictions, depression, anxiety, lack of prison experience, financial collapse, remorse and the effect of the Covid-19 pandemic on prison conditions. Those matters reduced but did not excuse the deliberate and continuing breaches. Her late admissions warranted only a small reduction.

6. A fine was insufficient to mark the seriousness and culpability of the contempts. The minimum commensurate sentence was eight months’ imprisonment. The sentence was not suspended because the case concerned punishment for serious past breaches, rather than coercion to secure future performance. The defendant was therefore sentenced to eight months’ imprisonment, with unconditional release after serving half the sentence.