As 2012 draws to a close, Chambers’ Regulatory Group has selected its favourite regulatory cases of the year, illustrating a number of important principles.

Iqbal v Solicitors Regulation Authority (unreported: Administrative Court 18/7/12)

This case is interesting, not for the outcome, but for the obiter comments made by the judges. The disciplinary charges were based on the accused solicitor, a sole practitioner, having held out persons in his firm as partners when they were not. At the disciplinary hearing the accused chose not to give evidence.

The Solicitors’ Disciplinary Tribunal (“the SDT”) held, correctly, that its practice was not to draw any adverse inferences from the accused’s failure to give evidence. Accordingly it dealt with the accused on the basis that there was no evidence of dishonesty.  

In the Administrative Court the judges described the SDT’s practice of not drawing adverse inferences against those who failed to give evidence as being “appropriate for the 19th century”. They said that the general public ordinarily expects professionals to account for their actions, and indicated that the SDT should change its procedures so as to allow adverse inferences to be drawn.  

The Court was surely right. If a regulator is to be able to act effectively in order to protect the public, it needs to be able to require its members to account for their actions and to take action against them if they fail, without good cause, to justify their actions.

Hill v Institute of Chartered Accountants in England and Wales [2012] EWHC 1731 (QB)

One of the members of an accountants’ disciplinary tribunal panel needed to leave the hearing early. Both sides agreed that he could do so. However in his absence he missed a crucial part of the defendant’s cross-examination (although a transcript of that part of the evidence was subsequently provided to him). The tribunal found the charges proved.

The defendant appealed on the basis that it was a breach of the rules of natural justice for the disciplinary hearing to have continued to hear such important evidence in the absence of one of its members, with or without the parties’ consent.  

The High Court held that the tribunal had breached the “Laws made by common consent must not be trampled on by individuals”- George Washington, 1732-1799 rules of natural justice by continuing with the hearing in the absence of one of its members when it could simply have adjourned the hearing. However it also held that by giving his consent to the member absenting himself, the defendant had voluntarily waived the breach. The appeal was therefore dismissed.

The principle is that if a party gives his consent to the tribunal proceeding in a particular way, he takes the risk of any adverse outcome arising from that.  

David Mayer v Francis Hoar [2012] EWHC 1805 (QB)

The High Court affirmed the principle that communications between an informant and a regulator are protected by absolute privilege. The claimant had brought a claim in the county court. The defendant was a barrister who had acted for the defendant in the county court proceedings. Following the dismissal of the county court claim, the claimant made a complaint to the Bar Standards Board (“the BSB”) that the barrister had harassed him and had also ridiculed him for his disability.

The BSB asked the barrister to comment on the allegations. He did so in trenchant terms and the claimant then sought to bring a libel action on the basis that the barrister’s comments to the BSB were untrue and malicious.

The High Court struck out the claim relying on Mahon v Rahn (No 2) [2000] 1 WLR 2150, in which the Court held that absolute privilege applied to communications between a financial services regulatory body and its informant, where the information was provided for use in investigations into a person's fitness to carry on investment business.

The decision is clearly correct both on authority and in principle. Those who need to, or are required to communicate with their regulator must be able to do so without fear of their communications forming the basis of a libel action against them; that principle cannot be undermined simply by the claimant suggesting that the communications were malicious.

Russell v Bar Standards Board (unreported: Administrative Court, 12/7/12)

This was an appeal by a barrister on the ground that one of the members of the disciplinary panel that had found the charge against him proved, had not been appointed to the panel in accordance with the published guidelines.

The Court held that a member of the panel, who had been appointed in apparent compliance with the panel’s rules, was “clothed” with the relevant authority to participate in the panel’s decisions regardless of whether the appointment was defective because of an irregularity in the nomination procedure. It followed that the panel’s finding of misconduct against the barrister was valid.

The message is reasonably clear that the Administrative Court will not strike down a decision simply on the basis that one of the members of the panel should not have been appointed. Rather there needs to be some substantive defect in the decision making process itself before the Court will interfere with it.

Damian McCarthy v Bar Standards Board (appeal to the Visitors of the Inns of Court, 25/1/12)

The BSB deliberately delayed in serving evidence on the accused barrister, contrary to its rules, as it was concerned that the barrister would invent facts if he was made aware of the details of the allegations against him.

The Visitors rightly criticised the BSB’s attitude as unacceptable. However it held that the procedural unfairness had not made any difference to the outcome of the disciplinary proceedings.

The principle is that regulatory proceedings are not to be manipulated by one side or the other to ensure a particular outcome. The credibility of the process and of the regulator in particular, depends upon being seen to act fairly in discharging its public function of disciplining its members.

Holmes v Royal College of Veterinary Surgeons [2011] UKPC 48

The College’s procedures provided for those who prosecuted charges against members, and also those who determined whether the charges were made out, to be drawn from the same governing committee.

The Privy Council held that this did not create any appearance of bias. The governing committee had put in place a number of procedures to ensure effective separation of the roles of prosecutor and judge. Therefore a fair minded observer who was aware of those procedures would not conclude that there was any risk of bias.

R (on the application of B) v Nursing and Midwifery Council [2012] EWHC 1264 (Admin)

B, a nurse, was accused by the Nursing and Midwifery Council (“NMC”) of professional misconduct by mistreating a patient in the care home where she worked. At a hearing the NMC decided that there were systemic failures within the care home and that it could not be disproved that the mistreatment of the patient had been caused by those systemic failures rather than by B’s actions. Accordingly it held that there was no case for B to answer, and dismissed the charge against her.

Subsequently the NMC decided it had confused the allegations against the care home with the allegation against B, and that it had applied the wrong guidance. It purported to rescind its decision that there was no case to answer and to reinstate the disciplinary proceedings against B.

The Administrative Court quashed the decision to rescind the finding of no case to answer and also the decision to reinstate the proceedings. Those decisions had been reached after reasoned consideration. Once they were made B had a legitimate expectation that the proceedings against her were at an end. They could not be revived simply because the NMC now regretted the quality of its decision.

The principle is that regulatory proceedings, like all other proceedings, require finality and that once a final decision has been taken, they will not be reopened save in exceptional circumstances.

Adeeko v Solicitors Regulatory Authority [2012] EWHC 841 (Admin)

A was ordered by the Solicitors’ Disciplinary Tribunal (“the SDT”) to pay costs of the disciplinary proceedings against him in the sum of £10,000. He appealed on the basis that he had no means of paying that sum and that accordingly the order should not have been made. The Administrative Court dismissed the appeal. A’s financial circumstances had been outlined to the SDT before it made its decision.

The principle is that disciplinary proceedings are civil proceedings and that, in common with other forms of civil proceedings, there has never been any rule that someone should not be ordered to pay costs just because of an apparent inability to pay them. The Court held that in any event the SDT could ensure fairness by making any further orders it thought fit as to enforcement.

R (on the application of the Chief Constable of Dorset) v Police Appeals Tribunal [2012] EWCA Civ 1047

The Court of Appeal upheld the Administrative Court’s ruling that, when considering what sentence to impose upon a police officer for having conducted himself dishonestly in the course of his duties, the correct approach was that adopted by the Solicitors’ Disciplinary Tribunal when considering what sentence to impose on solicitors for dishonesty.

The case is interesting because it shows that guidance by one regulator can be used legitimately by another regulator.