Santers Solicitors Limited & Anor v The Law Society of England and Wales & Anor

An intervention under the Solicitors Act 1974 may be justified by a swift assessment of reasonable suspicion, rather than proof of dishonesty. The court should assess the material reasonably available when the intervention decision was made, and a single sufficient reason may be enough. Natural justice does not require prior notice before urgent intervention to protect the public.

On an application to withdraw an intervention, the court must assess the current position and balance the residual public risk against the harm caused by continuation. The intervention should be withdrawn where the suspicion has substantially lessened and continuation is no longer necessary or proportionate.

The claimants, a solicitors’ firm and its principal, applied under the Solicitors Act 1974 for withdrawal of an intervention notice issued without prior notice by the Solicitors Regulation Authority. The notice was based on suspected dishonesty by the solicitor, by him as manager of the firm, and by an individual working for the firm.

The adjudicator relied on the solicitor’s engagement of an apparent identity fraudster, suspicious payments, failures concerning bank-account disclosure, and other regulatory concerns. The claimants accepted that the apparent fraudster had acted dishonestly but contended that the solicitor had been deceived. The issues were whether there had been sufficient reason to suspect dishonesty when the notice was issued and whether, in light of all later evidence, continuation of the intervention remained justified.

1. Initial validity. The adjudicator’s task was a swift regulatory assessment of whether there was reason to suspect dishonesty, not a final fact-finding exercise. Her decision had to be read fairly as a whole. She was entitled to assume that the relevant tests in the material before her had been applied unless there was a good reason to conclude otherwise.
2. The intervention did not require proof that the solicitor was dishonest. It was sufficient that one or more evidential matters gave rise to a reasonable suspicion. The engagement of a person using suspicious identity documents, payments from that person, refusal to authorise contact with the firm’s bank, and failure to disclose a relevant account were together sufficient.
3. The absence of prior notice did not invalidate the process. The rules of natural justice did not apply to this swift protective intervention procedure. It was not analogous to an ordinary without-notice application between private parties.
4. Withdrawal. The court considered the evidence available by the hearing, including the solicitor’s explanations and the fact that the apparent fraudster and associates no longer worked at the firm. The reasons for suspicion had not wholly disappeared but had been significantly weakened. The continuing intervention had caused substantial damage to the practice and the solicitor’s reputation.
5. The residual public risk had to be balanced against the harm caused by continuation. The risk was relatively small in the circumstances, while continuation was unnecessary and disproportionate. The notice was therefore ordered to be withdrawn.
6. The court declined to find alleged breaches of regulatory rules and codes on the basis of submissions alone. Those allegations had not formed the stated basis of the notice, had not been properly particularised in the evidence, and remained for the SRA to prove on the balance of probabilities. Any consequential matters were to be dealt with by written submissions if not agreed.

First-instance application under the Solicitors Act 1974. The intervention notice was ordered to be withdrawn.