Toni Fox-Bryant & Anor v The Financial Conduct Authority

A reply in an Upper Tribunal reference must identify every disputed matter in the respondent’s statement of case and give reasons for the dispute. A bare denial of allegations central to the case does not meet that requirement.

The respondent may bear the legal burden of proof, but an applicant must advance a tenable contrary case once the respondent has made an evidentially supported case. Particularised pleadings enable the opposing party to prepare its case and enable effective case management. An unless order may therefore require proper particulars, with strike-out and deemed admissions as proportionate consequences of non-compliance.

The Financial Conduct Authority issued Decision Notices withdrawing the Applicants’ approvals to perform senior management functions, imposing financial penalties and, in one case, making a prohibition order under the Financial Services and Markets Act 2000. The Applicants referred those notices to the Upper Tribunal.

The Authority’s case relied substantially on a review of client files concerning pension-transfer advice. The Applicants’ Reply denied that the files were unsuitable, but gave no reasons and incorrectly asserted that they lacked access to the files. The Authority applied for directions, including an unless order requiring particulars of the denials. The central issue was whether the Reply sufficiently identified the matters in dispute and the Applicants’ reasons for disputing them.

1. The Authority’s application for directions was granted. The Tribunal struck out the Reply’s incorrect assertions that the Applicants did not have access to the client files. The evidence showed that the relevant files had been disclosed and that the Applicants acknowledged receiving them.

2. Under Schedule 3, paragraph 5(2) of the Tribunal Procedure (Upper Tribunal) Rules 2008, a reply must identify disputed matters in the respondent’s statement of case and state the reasons for disputing them. Paragraphs 33 and 39 of the Reply gave only bare denials of findings forming the cornerstone of the Authority’s case. They did not comply with that requirement.

3. The purpose of pleadings is to give the opposing party sufficient notice of the case to be met. Particularisation was also necessary for the Tribunal to manage evidence, resources, and the length and listing of the substantive hearing. The fact that suitability would ultimately be determined by the Tribunal did not excuse inadequate pleadings.

4. The Authority bore the legal burden of proof. That did not permit the Applicants simply to deny its evidence-supported case. They were required to put forward a tenable contrary case, particularly as they were pension-transfer specialists with knowledge of the files. A claimed lack of resources or expert evidence did not justify refusing particulars.

5. The earlier Authority email concerning CFP’s response to the file review could be relied on as part of the Applicants’ substantive case, but did not displace their procedural obligations. Unless, by 31 December 2023, they filed and served an amended Reply giving proper particulars, paragraphs 33 and 39 would be struck out and they would be deemed to admit the specified allegations in the Statement of Case.

Upper Tribunal (Tax and Chancery Chamber): This was an interlocutory decision in the Applicants’ references from the Financial Conduct Authority’s Decision Notices. The Tribunal granted the Authority’s application for directions and made an unless order.