TONY NORMAN GUISE v SOLICITORS REGULATION AUTHORITY

An appellate court hearing an appeal from a specialist disciplinary tribunal must show restraint when reviewing factual findings and evaluative judgments. It may intervene where there is an error of law, a critical finding without evidential basis, a demonstrable misunderstanding or failure to consider relevant evidence, or a conclusion that no reasonable tribunal could reach.

A tribunal need not answer every submission. Its reasons must adequately address the principal controversial issues and enable the reader to understand the decision. Guidance concerning documentary evidence and witness recollection is not automatically binding. A shadow directorship requires direction of the company’s directors and an established pattern of obedience, not merely co-operation or a contractual relationship.

This was an appeal under section 49(1) of the Solicitors Act 1974 against a decision of the Solicitors Disciplinary Tribunal following a prosecution referred by the Solicitors Regulation Authority.

The Tribunal had struck the claimant off the Roll of Solicitors and ordered him to pay costs after finding proved two allegations involving unauthorised transfers from a company account and a client account. Dishonesty was found as an aggravating feature. The appeal challenged the Tribunal’s factual findings, its treatment of witness recollection and documentary evidence, its reasons concerning shadow directorship and ownership of funds, and its assessment of an alleged agreement with a client.

1. Appeal dismissed. The Tribunal’s findings on both allegations were upheld. The sanction was not challenged independently if liability findings stood.
2. The governing appellate approach is one of restraint. The question is whether the decision was one which no reasonable tribunal could have reached. That may be shown by an error of law, a critical finding without evidential basis, a demonstrable misunderstanding or failure to consider relevant evidence, or an evaluative conclusion outside the range reasonably open to the Tribunal. Particular caution is required where a specialist tribunal has heard and assessed witnesses.
3. Reasons need not address every argument. Under Article 6, and the approach reflected in South Bucks District Council v Porter (No 2), reasons must be intelligible and adequate, address the principal important controversial issues, and disclose how material issues of law or fact were resolved. The claimant suffered no reasons failure in relation to the shadow-director issue or the other factual complaints.
4. Gestmin SGPS S.A. v Credit Suisse (UK) Limited & Anor was not binding on the Tribunal. It identified factors relevant to assessing recollection in an appropriate commercial case, but did not require any particular method of fact-finding and did not have to be cited, especially where the available documents did not provide the proposed cross-check. The claimant’s challenges therefore remained challenges to credibility and weight.
5. Section 251(1) of the Companies Act 2006 requires a person to be one in accordance with whose directions or instructions the company’s directors are accustomed to act. Applying Re Hydrodam (Corby) Ltd, the evidence had to establish the directors, directions as to how they should act, compliance with those directions, and an established pattern of such compliance. CLAN’s role as a customer determining events did not establish control of CCS or its directors.
6. The Tribunal was entitled to accept the client’s evidence, draw an adverse inference from the claimant’s refusal to testify, and reject peripheral attacks concerning emails, repayment timing, the Adjudication Panel’s decision and the use of funds. The Adjudication Panel had performed a different task on documents alone, so the Tribunal was entitled to attach no weight to its decision.

• High Court (Administrative Court): appeal under section 49(1) of the Solicitors Act 1974 dismissed.
• Solicitors Disciplinary Tribunal: found two allegations proved, including dishonesty, struck the claimant off the Roll of Solicitors and ordered payment of £55,824.81 in costs. Judgment handed down 26 February 2021.