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England and Wales High Court (Chancery Division) Decisions |
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You are here: BAILII >> Databases >> England and Wales High Court (Chancery Division) Decisions >> Solicitors Regulation Authority v Robinson [2019] EWHC 3223 (Ch) (28 November 2019) URL: http://www.bailii.org/ew/cases/EWHC/Ch/2019/3223.html Cite as: [2019] 4 WLR 162, [2019] Costs LR 2081, [2019] WLR(D) 679, [2019] EWHC 3223 (Ch) |
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BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
BUSINESS LIST (ChD)
The Rolls Building, London EC4A 1NL |
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B e f o r e :
Sitting as a Judge of the High Court
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In the matter of a solicitor and in the matter of Sch 1 to the Solicitors Act 1974 Solicitors Regulation Authority |
Claimant |
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- and - |
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John McLee Robinson |
Defendant |
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Sam Neaman (instructed by RadcliffesLeBrasseur) for the Defendant
Hearing date: 24 October 2019
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Crown Copyright ©
HHJ David Cooke :
"13 Subject to any order for the payment of costs that may be made on an application to the court under this Schedule, any costs incurred by the Society for the purposes of this Schedule, including, without prejudice to the generality of this paragraph, the costs of any person exercising powers under this Part of this Schedule on behalf of the Society, shall be paid by the Solicitor or his personal representatives and shall be recoverable from him or them as a debt owing to the Society.
13A (1) The High Court, on the application of the Society, may order a former partner of the solicitor to pay a specified proportion of the costs mentioned in paragraph 13.
(2) The High Court may make an order under this paragraph only if it is satisfied that the conduct (or any part of the conduct) by reason of which the powers conferred by this Part were exercisable in relation to the solicitor was conduct carried on with the consent or connivance of, or was attributable to any neglect on the part of, the former partner.
(3) In this paragraph " specified " means specified in the order made by the High Court."
"Mr Robinson is the sole equity owner of McLee & Co Solicitors…he was suspended from practice on 9 March 2011 for 12 months. He has no plans to return to the practice for the present and has put in place the current management structure to manage the firm in his absence…"
" … I am the sole equity owner of the firm… Mr Ramasamy was and always has been a salaried partner and employee of McLee & Co Solicitors prior to my suspension. As far as I am concerned he is still an employee of McLee and standing in my place until the outcome of my appeal [against suspension]…My understanding is that in order for the firm to continue as a Partnership Mr Ramasamy, being Principal of McLee in my absence had to take on another partner to satisfy the SRA requirements. I am aware that he has taken on Mr Burgal as a partner…I consider myself to be the owner of McLee Solicitors and that any application made by any staff of McLee & Co or any order or direction made by the SRA to take my firm from me without first informing me of the reasons why is wrong in principle and in law…"
i) Mr Ramasamy as the sole principal after Mr Robinson's suspension had required authorisation to act as a sole practitioner but had never obtained it or otherwise regularised the firm's position.
ii) The SRA was aware since Mr Robinson's email in August 2011 that he was the sole equity owner of the firm. That was incompatible with the requirement of the SCC that every owner of a recognised body must fall within one of three categories, which Mr Robinson did not as he had no practising certificate. However the SRA had not taken steps to revoke the firm's recognised body status.
iii) When Mr Ramasamy resigned as the last remaining registered principal (31 October 2011) the firm should have ceased to practise in compliance with the Recognised Body Regulations 2011. Those came in to force in October 2011 but replaced earlier provision to the same effect. Mr Ramasamy was notified of this. When Ms Mbeledogu became involved she too was aware of it.
iv) Since April 2012 no qualified solicitor had been supervising the four or five unqualified staff working at the firm. Neither of the last two persons held out as partners (Ms Mbeledogu and Ms Ifionu) was a signatory on the two client bank accounts and it was not clear who controlled them. Mr Robinson had access to at least one office account, which was irregular.
v) All these matters were breaches of regulatory requirements. They were serious and created an urgent need to intervene to protect the interest of clients and the public. There was no reasonable prospect of Mr Robinson remedying these breaches because of the restrictions on his practising certificate.
i) He was not involved in the management or operation of the practice at all after his suspension. To the extent he visited the office it was only for the purpose of preparing his appeal against suspension.ii) All client matters and all management of the firm were carried on by those for the time being named as partners or principals in it. He was not aware of and did not consent to any of the matters relied on by the SRA.
iii) He was never advised by the SRA that the firm should close, or even contacted by the SRA in respect of any of these matters until July 2012.
iv) Mr Ramasamy was never warned that the practice should close; rather the SRA engaged in extended correspondence with him about permitting it to continue and how to regularise its position. Any failure to achieve that was Mr Ramasamy's responsibility.
v) Ms Mbeledogu was so warned, but any failure to regularise the position was her responsibility and something he was not aware of.
vi) In any event, even if any of these matters were found against him it would not be just to order him to pay any of the costs, because any action on his part was inadvertent. Responsibility for the continuation lay with the SRA because, rather than taking steps to ensure the firm closed it had permitted and encouraged Mr Ramasamy and Ms Mbeledogu to seek to regularise its position.
i) Mr Robinson's own email of 12 August 2011 making clear he was and intended to remain the sole owner of the firm, that Mr Ramasamy was only ever (and remained) an employee of the firm (which, if he was the sole owner, must mean an employee of Mr Robinson), that Mr Ramasamy was "standing in my place until the outcome of my appeal" and that Mr Ramasamy "being principal of McLee in my absence had to take on another partner [ie Mr Burgal] to satisfy SRA regulations" but he had not consented to any transfer of ownership to either of them.ii) Mr Robinson maintained this position throughout; in a telephone conversation with the SRA on 24 May 2012 (p 199A) he emphasised that he remained the sole equity owner and that all the other individuals named as partners had been salaried partners (which again must mean his employees).
iii) Mr Ramasamy's insurance application in September 2011, referred to above, in which he said that the present management structure had been put in place by Mr Robinson to manage the firm during his absence. This is of course hearsay, but I see no reason to think it did not reflect Mr Ramasamy's knowledge; he had no apparent motive to pretend Mr Robinson was involved if he was not, and indeed it appears that attempts to change the firm's registration status to one in which Mr Robinson was not seen as an owner had not been pursued because of Mr Robinson's intervention to make clear that he remained the sole owner.
iv) Mr Burgal told the SRA in his "whistle blowing" letter of 5 December 2011 (p 176A) that:
a) It was Mr Robinson who approached him to become a partner, in June 2011 (ie while suspended and when it was intended to register the firm as having two partners).b) Mr Robinson had promised him a personal indemnity against loss if he accepted.c) Notwithstanding he was ostensibly a partner, Mr Robinson, Mr Ramasamy and the practice managers held meetings, which they told him were to deal with the SRA's investigations (ie the Forensic Investigation in July 2011), from which he was excluded.d) He was excluded from operation of the firm's bank accounts but found that payments had been made to Mr Robinson and his wife, which Mr Robinson told him were justified because "it was his firm and his wife was working in the firm". As far as Mr Burgal knew, Mr Robinson's wife did not work in the firm.e) He had been dismissed after insisting on explanations and proper supervision in the office and replaced by Ms Mbeledogu who was considered by Mr Ramasamy as more willing to cooperate without asking questions. He was making a tribunal claim for two months unpaid salary.Mr Robinson said that all this was hearsay (as it is) and not reliable as Mr Burgal, and indeed all the others who had been involved in the firm, were merely seeking to blame everything that could be criticised on him to exculpate themselves, since he was suspended and therefore fair game for any accusation. But I do not consider that what Mr Burgal says about Mr Robinson's involvement can be dismissed on that basis; I have nothing to show that any criticism was being levied against Mr Burgal specifically, and insofar as he might have been thought generally potentially responsible for what the SRA investigations had found, he could have put the blame on Mr Ramasamy without inventing allegations of continued involvement by Mr Robinson. What Mr Burgal says about his own appointment being arranged by Mr Robinson corresponds with what Mr Ramasamy told the insurers in the application form quoted above.v) Ms Mbeledogu wrote to the SRA on 31 July 2012, responding to the most recent FIR as the person ostensibly in charge of the firm (p 231C) saying that:
a) She had only ever been an employee, so confirming what Mr Robinson himself said. She and Ms Ifionu both told the SRA investigator in June 2011 that Mr Robinson was the sole equity owner of the firm, which must be what he had told them, and that if they left it would be his responsibility to appoint new partners (p 200R).b) It was Mr Robinson who had provided the documents and fee for her abortive attempts to regularise the firm's status.c) She had attempted to exercise control over the firm but that Mr Robinson "was controlling the firm behind the scenes" and "had no intention of relinquishing any control or management of the firm to… myself and [Ms Ifionu]… all the meetings and telephone conversations I had with [Mr Robinson] were a complete waste of my time and effort. Evidence of [Mr Robinson's] control of the firm was by way of him employing incompetent members of staff (some of them consisted of members of his own family), he controlled the accounts and therefore had access to the password which he refused to pass on to both myself and [Ms Ifionu]…". She had told the investigator during her visit that the bank accounts and financial accounts were controlled by the firm's bookkeeper and that Mr Robinson gave instructions to the bookkeeper.d) She had joined the firm after being introduced by Ms Ifionu to Mr Robinson (not Mr Ramasamy) who because of "some problems with the SRA" needed "a partner to assist him run the firm… he seemed extremely desperate to get me on board so that I could assist him with getting the firm authorised as a partnership with the SRA…"e) Mr Robinson had not initially told her he was suspended, and when he did, said that the SRA was being racist towards him by attempting to close his firm solely because he was black. She had been "initially sucked in by his story and felt that as a black solicitor too I should help him run his firm."f) She had left because she had no control over management and "the fact that [Mr Robinson] ceased paying my salary".Mr Robinson said that this too was unreliable and should be looked at as Ms Mbeledogu seeking to exculpate herself from blame for what was found in the investigations in April and July 2012. But again I do not consider it can be dismissed as invention. Much of what is said has the ring of truth. It reflects what was said to the investigator during her visits, when the investigator had the opportunity to cross check with other staff and records.The investigator could not find out for certain who did control the bank accounts, and followed up the information that Mr Robinson had involvement in them by her questions to Ms Mbeledogu, Mr Robinson and Ms Ifionu. I do not think it likely that Ms Mbeledogu had not told the truth about this; it seems implausible that either (a) if she did have control of the accounts she would have created trouble for herself by wrongly denying it, or (b) that if someone other than Mr Robinson had control, she would have anything to gain by concealing that and lying to say it was Mr Robinson.Mr Robinson has in fact alleged that the actions taken against him by the SRA (both before and after his suspension) were motivated by racism; see for example his complaint to the Ombudsman Service at p269ff, and especially at 269 H-P. That complaint was not upheld. It is plausible that Ms Mbeledogu may have been willing to help him as she said if he had told her something similar, and not very likely that she would invent this or, if she had agreed to help Mr Robinson as a perceived victim of racism, that she would then pick him as scapegoat when, if his account is correct, there were others such as Mr Ramasamy and Ms Ifionu more recently and directly involved.vi) In July 2012 Mr Robinson contacted Ms Ifionu to seek her cooperation in his return to practice, saying (p 231K) "I have given you opportunities and all I ask of you is to respond to the SRA so I can get my certificate." This clearly suggests he was responsible for her joining the firm and/or becoming a partner though that was in or about November 2011 when he maintains the practice was being run by Mr Ramasamy.
vii) Ms Ifionu made some similar allegations about Mr Robinson's continued involvement with the firm in a letter of 13 August 2012, also responding to the recent FIR (p 239C). I would be less inclined to place weight on what Ms Ifionu says, because of doubts about claims she made to have resigned on 6 March 2012 (see resignation letter at p 44, misdated 16 March 2011) when she was found working at the firm in the investigation in April, and her subsequent claim to have left at the end of April when she was seen there some weeks after that by the SRA's investigator.
viii) Mr Robinson did in fact have access to one or more office bank accounts, and sums were paid out from them to him for items of personal spending. The investigator in June 2012 was not able to find all relevant bank statements but those she did find showed (p 200S) three payments of £300 by standing order in what appears to have been a regular monthly payment, and a considerable number of payments for rail travel between Brighton (where Mr Robinson's home is) and London (totalling some £829) and for groceries at shops in Brighton (£470). These payments were made between November 2011 and April 2012. Mr Robinson accepted that he had a business card and used it to charge these personal expenses to an office account. He said that he had Mr Ramasamy's permission to use it for food and travel because he had no other income and was desperate, and that all the train travel had been to come to the office to use a computer there for preparing his appeal as he did not have one at home. I did not believe his evidence. These payments are likely to be representative of the position in months for which statements could not be found and are more consistent in my view with the picture painted by Mr Burgal and Ms Mbeledogu of Mr Robinson continuing to regard the firm and its resources as his own.
The first FIR found that as at June 2011 Mr Robinson remained a signatory on all the firm's client accounts as well as its office accounts, and could operate them without involving Mr Ramasamy or anyone else (p 110D). However I do not place reliance on this as there is no evidence that he made use of that authority, save for the payments from office accounts referred to above.