Richard Thomas Barnes v The Royal Institution of Chartered Surveyors

A contractual disciplinary body must act within the powers conferred by its governing contract and must conduct a due enquiry. An erroneous legal approach, or factual conclusion outside the range of reasonable conclusions open to the tribunal, may invalidate consequential findings, sanctions or costs orders.

On a summary judgment application, the court may decide a short point of construction where the evidence is sufficient, but must not conduct a mini-trial. A regulatory sanctions policy is not contractually binding merely because it exists. Incorporation depends on the contractual wording or an implied term satisfying the requirements of obviousness or business efficacy.

The claimant, a surveyor and member of the defendant professional body, brought a contractual claim seeking costs, alternatively damages and interest, arising from disciplinary findings, sanctions and costs orders made after he submitted an adjudication decision substantially similar to another adjudicator’s work.

The defendant applied to strike out the claim or obtain summary judgment. The claimant alleged that the disciplinary and appeal panels mishandled his evidence and applied the wrong dishonesty test. He also alleged that the costs awarded exceeded the contractual limits in the defendant’s sanctions policy. The central issues were whether those allegations disclosed a viable contractual claim and whether the sanctions policy formed part of the membership contract.

1. Summary judgment granted. The claimant had no real prospect of succeeding and there was no other compelling reason for a trial. Had summary judgment not been granted, the claim would have been struck out as disclosing no reasonable grounds.
2. The court accepted, for the purposes of the application, that a disciplinary process involving an error of law or factual conclusions outside the range of reasonable conclusions open to the panel would not constitute the contractual requirement of due enquiry. A sanction or costs order outside the panels’ contractual powers would likewise be a breach.
3. The disciplinary panel had correctly stated and carefully applied the dishonesty test in [2017] UKSC 67. It rejected the claimant’s account that he had used the other adjudicator’s decision as a template in the ordinary sense, and was not required to refer to every piece of evidence in its reasons.
4. The appeal was by way of review, not rehearing. The appeal panel properly exercised restraint concerning factual findings based on evidence heard and evaluated by the disciplinary panel. Its determination showed that it reviewed how the evidence had been addressed and concluded that the original findings were reasonably open to the panel.
5. The sanctions policy and its costs supplement were not incorporated into the membership contract through the rule referring to fines. A fine was penal, whereas a costs order was compensatory, and the governing provisions distinguished disciplinary penalties from costs. Nor could incorporation be implied: the requirements identified in [2017] UKPC 2 were not met. The policy was neither so obvious as to go without saying nor necessary to give the contract business efficacy.
6. The court nevertheless observed that, if the costs supplement had been incorporated, the claimant would have had a real prospect of arguing that hearing costs were capped at £2,650. His argument that the defendant could recover only its direct employment costs was unarguable. The court also rejected the wider suggestion that the disciplinary process was unfair or disproportionate.