BAILII is celebrating 24 years of free online access to the law! Would you consider making a contribution?
No donation is too small. If every visitor before 31 December gives just ยฃ1, it will have a significant impact on BAILII's ability to continue providing free access to the law.
Thank you very much for your support!
 |
[Home] [Databases] [World Law] [Multidatabase Search] [Help] [Feedback] | |
England and Wales High Court (Queen's Bench Division) Decisions |
||
|
You are here: BAILII >> Databases >> England and Wales High Court (Queen's Bench Division) Decisions >> Dike v Rickman [2005] EWHC 3071 (QB) (22 November 2005) URL: http://www.bailii.org/ew/cases/EWHC/QB/2005/3071.html Cite as: [2005] EWHC 3071 (QB) |
||
[New search] [Printable RTF version] [Help]
QUEEN'S BENCH DIVISION
133137 Fetter Lane London EC4A 1HD |
||
B e f o r e :
(Sitting as a Judge of the High Court)
____________________
| IAN DIKE | Claimant | |
| - and - | ||
| (1) GERALD RICKMAN | ||
| (2) ZIEGLER RICKMAN LIMITED | Defendants |
____________________
Gary Self (instructed by Moore & Blatch for the defendants)
____________________
Crown Copyright ©
HH Judge Richard Seymour QC:
Introduction
"6. The Client shall not control, nor have any right of control as to how the consultant is to perform the Services. The Client recognises that the consultant offers specialist services at a high level of expertise and as such the consultant cannot be told how to perform the Services, other than to ensure that the consultant complies with the requirements of any Regulatory body with whom the Client is authorised or regulated.
.
12. During the term of this Contract for Services the Client will maintain insurance cover in respect of professional indemnity to include the actions of the consultant, but in the event of the Client being held responsible during the term of this contract or any time thereafter for any action or advice given by the consultant to a third party which results in financial cost or loss to the Client, the consultant will indemnify the Client in respect of such liability.
.
18. The consultant is not entitled to partake in any grievance procedure which the Client operates and as an independent self employed consultant is not entitled to any employment law rights."
"Following your recent application to join St James's Place, I can confirm that we would be delighted for you to join us as an associate Partner of the St James's Place Partnership.
As you know, we are currently in the process of obtaining references in support of your application and as soon as these are clear we will let you know. In the meantime, this means that we will be unable to register you with the FSA and you will not, therefore, be able to act on our behalf in any way. We will, of course, let you know as soon as the references are clear. However, should you have any queries please talk to Martin Brunt.
I am convinced that with your contribution the St James's Place Partnership will become the most professional and trusted provider of advice on wealth management."
"Just a note to confirm most of what I said to William on Wednesday afternoon and to be sure that you both get the same information.
As mentioned to you I shall be visiting St James's Place next week to have a detailed look at their whole business and to see whether I feel it does provide what I am looking for. I am not committed to them since they take the view that they can't recruit IFAs until they have had a chance to have a proper look.
I shall confirm to you on either Monday 31 March or Tuesday 1 April my intentions. If I decide to move to St James's Place I will formally submit my resignation then. I am hoping to go on a week's holiday from Saturday 5 April to Saturday 12 April and then Barbara is away for the week after Easter. Friday 2 May might therefore be a proposed date of leaving but can we discuss that if appropriate?
I would like to take this opportunity, even if my proposals don't come to fruition, to thank both of you for the honourable way in which you have kept the agreements we made when I first joined you. Unfortunately this has not been my experience previously. This is appreciated and whilst there have been the occasional incidents over the last three and a half years, generally things have gone very well I believe to mutual satisfaction.
In the event that my decision is to leave I look forward to being able to do so on excellent terms and that the agreements that we made on both sides, in terms of outstanding commissions, future claw-backs and client agency transfers will be honoured. Could I suggest that we could deal with those issues, if appropriate, during week commencing 31 March?
"Further to my conversation with you both on Tuesday I now formally confirm my intention to resign from the company. My plan is that my last working day will be Friday 2 May. Hopefully I should have been able to move out my furniture and belongings by then but if there is an overlap by a day or two I trust that that would not be a problem if needed.
I am concerned about the transfer of agencies in respect of my clients as I would like this finalised before my departure. I will discuss this with you again shortly.
Once again, may I thank you both for your help and support during my time here and I wish you well in your new arrangements."
"We have received an application from the above named [that is to say, Mr Dike] to join St James's Place as a Company Representative.
To help us with our enquiries, I would be grateful if you could answer the questions on the attached form as fully as possible. However, should you prefer to use your own standard reply, please do so quoting our reference above."
Enclosed with the letter was the standard form of questionnaire used by SJP. As I have indicated, the reference took the form of answers given to the questions in that form by Mr Rickman. It is appropriate now to turn to the reference.
The reference
"[Question] 6. Has the applicant made the anticipated progress in compliance, technical and product training.
[Answer] No. To compliance only.
[Question] 8. Have there been any complaints made against the applicant? If so please state the date and nature of each complaint (if no complaints, please proceed to question 10).
[Answer] Yes. 3 complaints for misselling 2003/2002
All result from misselling Split Capital Inv. Trust.
1 withdrawn 1 full closure letter sent [that is, complaint investigated and found to lack substance] 1 with ombudsman
One complaint from client's solicitor regarding equity release still ongoing 2003.
[Question] 10. Has there been any evidence that the applicant has failed to give investors best advice? If so, please provide full details.
[Answer] Reports in complaints regarding verbal advice from Mr Dike (not upheld in correspondence) indicate bad advice sometimes given but not proven.
[Question] 14. How much money, if any, does the applicant owe you on account of:
.
d Any other reasons
[Answer] Nil. We still have to await the decision of the ombudsman. If compensation due Mr Dike will be responsible for this.
[Question] 17. What is/was the reason for the applicant no longer being tied to your company?
[Answer] We are currently moving to ISL Network & Mr Dike abhors both administration and compliance. He sees more rather than less and wants to move.
[Question] 18. Any other comments:
[Answer] Mr Dike is a very difficult person with whom to work. We shall not be sorry to lose his services. We have received two complaints of sexual harassment from a secretary and outside office cleaner. Mr Dike has been cautioned for both complaints which he denied. No further action resulted."
"[Answer to Question 6]
This answer was false. The claimant's performance on compliance was good. His files were and were recognised by the 2nd Defendant to be satisfactory with regard to both compliance and organisation. The 2nd Defendant made a statement to suck effect in its letter to SJP dated 28 April 2003 (p.2 para 2)
[Answer to Question 8]
The statement that the 3 complaints for misselling all resulted from misselling split capital inv. Trusts was misleading. In no case had the Compliance Officer of the 2nd Def (the 2nd Def) found any evidence of misselling.
The reference to the complaint from the Client's solicitor regarding equity release failed to make it clear that the complaint related to a transaction that did not go ahead and in respect of which the claimant sought to levy a charge of ฃ125.
[Answer to Question 10]
This answer was extremely misleading. It related to Q.8 in response to which details were given of complaints. Q.10 asked for details as to whether there was any evidence of failure to provide best advice. There was no evidence in the files that the claimant had failed to give best advice and indeed the files showed that the risk profile of investments, as per the company literature, matched with the client's risk profile and the 1st Def having examined the files found that they were compliant. He so stated in the 2nd Def's letter dated 28 April 2003 (p.1 paras 5 and 6). The accurate answer would have been that there was no evidence that the Applicant had failed to give investors best advice.
[Answer to Question 14 d]
This answer was unnecessary in the context of the reference. Moreover it was inaccurate and incomplete because the complaint to the Ombudsman had been triggered by the claimant following instructions of the Directors of the 2nd Def (Mr Ziegler and the 1st Def) upon receipt of a complaint from Mrs Fordyce. If therefore the Ombudsman's decision had been adverse to the 2nd Def on a ground relating to that instruction, the claimant would not have been responsible for it.
[Answer to Question 17]
The statement that the claimant abhors both administration and compliance was untrue.
[Answer to Question 18]
The first 2 sentences were untrue, alternatively misleading. In the 2nd Def letter dated 28 April 2003 (p.2 para 9) the 1st Def stated In completing this form it was not my intention to give the impression that Mr Dike was an unsuitable person, and would point out that if we, as a company had felt he was a liability to the company we would have terminated our contract with him. This is not the case, his application to you being driven by changes to the circumstances of Ziegler Rickman Ltd. However it was my duty to complete your reference accurately and honestly.
It was untrue that the 2nd Def had received 2 complaints of sexual harassment. 1 complaint from a secretary had been communicated to the claimant (by letter dated 16 May 2001) to the effect that the complaint from a member of staff was that the claimant had become over-familiar with the female staff in the office causing them embarrassment, Mr Ziegler (who wrote the letter) stating that he was sure that the actions were not deliberate. This was not, nor was it anything close to, a complaint of sexual harassment.
The 2nd complaint from a cleaner (which had not been communicated to the claimant) was to the effect that the cleaner alleged that the claimant had passed several sexist remarks and she felt that he expected her to pick up and dispose of old food from his floor: the complaint had allegedly been dealt with by the employer of the cleaner speaking to the claimant (the claimant denies this) and asking him to throw old food away and refrain from off-the-cuff comments to Carole, even if he felt they were insignificant and meaningless. This was not a complaint of sexual harassment.
In any event the answer was incomplete. To have been complete in relation to the alleged complaint by the secretary the answer should have stated that the complaint had been made 2 years earlier and that no further complaint had been made by that member of staff and that Mr Ziegler had persuaded the claimant not to take legal action in relation to the complaint upon the basis that the complainant was of a sensitive nature and had made a similar accusation about another staff member earlier and that the file note would be removed after 12 months: to have been [illegible manuscript words added] the alleged complaint by the cleaner the answer should have stated that the incident had not been discussed with the claimant.
It was misleading to state that the claimant had been cautioned for both complaints, since that terminology implies that despite his denials the complaints had been found proved whereas they had not been investigated let alone found proved."
"The general thrust of the reference was very disparaging to the claimant and gave the reader the impression that.'
1. The claimant's attitudes to compliance were inappropriate.
2. There was reasonable suspicion that the claimant had failed to give investors best advice.
3. A complaint made against the claimant had resulted in a reference to the Ombudsman.
4. There were grounds to suspect the claimant had been guilty of sexual harassment.
5. The claimant was unsuitable for employment (whether under a contract of service or contract for services) as an adviser in the financial services industry.
This was a misleading and false impression and unjustified by anything within the claimant 's client files, his personnel file or known to the 1st Defendant or the 2nd Defendant."
The claims made in the action
"The particulars of the negligence averred in para 16 above are as follows, references to the 1st Defendant being references to the 1st Defendant himself and in his capacity as Director of the 2nd Defendant:
PARTICULARS OF NEGLIGENCE
17.1 [not pursued]
17.2 In respect of question 6 there was no evidence or no sufficient evidence to justify the negative answer given in relation to the claimant's progress on compliance:
17.3 In respect of the answers to question 8, the 2nd Defendant failed to consider whether the answers as drawn properly reflected the nature of the complaints and failed to state that each of the three alleged complaints for misselling had been investigated by the Compliance Officer of the 2nd Defendant (the 1st Defendant) and that in each case the 1st Defendant had found that the claimant's conduct of the file was compliant.:
17.4 The answer given to question 10 failed to differentiate between the complaint on the one hand and evidence on the other that the claimant had failed to give investors best advice. Addressing the proper question the 1st Defendant should have advised that he as Compliance Officer had investigated the complaints and found there to be no evidence that the claimant had failed to give investors best advice:
17.5 In giving the answer that he did to question 14(d) the 1st Defendant failed to pay any or any [sic] regard to the fact that the complaint to the Ombudsman was prompted by the claimant carrying out the direction of the Directors of the 2nd Defendant:
17.6 In respect of the answer to question 17 there was no, alternatively no adequate evidence either on file or known to the 1st Defendant which justified the assertion that the claimant abhors both administration and compliance:
17.7 In respect of the answer to question 18:
17.7.1 there was no, alternatively no sufficient evidence on file or known to the 1st Defendant to support the assertions that the claimant is a very difficult person with whom to work and that we (meaning the 2nd Defendant) shall not be sorry to lose his services:
17.7.2 there was no evidence on file or known to the 1st Defendant to support the assertion that two complaints of sexual harassment had been received:
17.7.3 neither complaint particularised under the reference to sexual harassment amounted to a complaint of sexual harassment:
17.7.4 alternatively, having chosen to describe these complaints as being ones of sexual harassment, the 1st Defendant failed to spell out the true nature of the complaints:
17.7.5 the statement that the claimant had been cautioned for both complaints failed to pay heed to the fact that there was no, or no sufficient evidence on file or known to the 1st Defendant to support a caution:
17.8 In all the circumstances the reference provided was such that it was probable that it would cause any prospective employer to reject an application by the claimant upon the basis that he was not a fit candidate for employment, whereas there was no or no sufficient evidence on file or known to the 2nd Defendant to justify or support the disparaging thrust of the reference."
"Further or alternatively the answer to question 18 was false in the respects pleaded in Part 1 of the Schedule in relation to that answer. The 1st Defendant made the statement comprised in the answer maliciously.
PARTICULARS OF MALICE
18.1 The 1st Defendant upon being informed by the claimant that he was contemplating taking an appointment with SJP knew that the 2nd Defendant would be asked to give a reference to SJP but gave no warning to the claimant that the reference, if completed by him, would be adverse:
18.2 The 1st Defendant gave the reference at a time when he knew both that the claimant had given notice of resignation from the 2nd Defendant and that the 2nd Defendant had accepted and implemented that by giving the appropriate notification to the Financial Services Authority:
18.3 The 1st Defendant therefore gave the reference in circumstances where he knew that the inevitable consequence would be that the claimant's application to SJP would be rejected and his future employment prospects in the life insurance and investment advice industry would be blighted:
18.4 The 1st Defendant gave the reference under the cloak of assumed secrecy believing that the claimant would not discover that he had given an adverse reference:
18.5 The above circumstances give rise to the inference that out of malice the 1st Defendant intended in giving the reference to sabotage the claimant's existing application and to blight his future employment."
Mr Rickman's explanations for the terms of the reference to which exception was taken
"83.6 Q.6
The question was quite specific in that it asked if he had made the 'Anticipated progress in compliance'. The nature of compliance is that it is an ongoing progression, therefore the most up to date files are the most relevant.
I checked files relevant to this question. In particular the files relating to complaints received concerning his activities.
I have referred to the complaint from Mrs Fordyce at paragraph 56 above. This file contained evidence from the client that showed Mr Dike had received a complaint and returned it to the complainant several times asking for amendments to be made or that it should be withdrawn.
This indicated that compliance had not been adhered to and correct procedures had not been followed.
Mr & Mrs Hardy had complained through their solicitors about the charge for an aborted equity release scheme. On this file, compliance with regards to the Mortgage Code Compliance Board and the Consumer Credit Act had not been adhered to, and the correct procedures had not been followed.
Further issues were recorded on his file. A memo from William to Mr Dike dated 11 September 2000 with regards to not supplying continuous professional development progress reports, which is a compliance issue, was on file. Compliance is an on-going process necessary to keep abreast of new legislation.
At the time of leaving Ziegler Rickman Ltd. pension plans sold by Mr Dike previous to his joining us, were under review by the compliance manager, Wendy Beckett of Sage Financial Services Limited, one of his previous employers. This was part of the Pension Review started by the Securities Investment Board in 1994. They had been asking Mr Dike for assistance in this for some time, and at this time, he had not responded to twenty six cases.
Ms Beckett emailed us on the 28 April 2003 and advised us, 'If we are unable to complete the review because of lack of co-operation of another registered individual this will be formally notified to the FSA who are anxious for everyone to complete the review'. Hence the question used the phrase 'anticipated progress'. As the compliance issues were both recent and, in some cases, potentially serious breaches, I answered truthfully, but in the shortest way possible.
83.8 Q.8
Mr Dike advised Mr Ziegler and I, before he went on the introduction course with St James's Place, that he had provided them with all details regarding all three complaints regarding the misselling of split capital investment trusts. In addition, when he told me that a reference was being sent to me and it needed to be returned as soon as possible (on or about 8 April 2003), I said that I would have to mention the three complaints and he acknowledged that and confirmed he had mentioned them to St James's Place.
The three complaints were:
1. The withdrawn complaint from his secretary, Barbara Griffiths at paragraph 43 [of Mr Rickman's witness statement]. He had sold her this investment and it had lost money. Initially she complained, but later withdrew the complaint. A letter of withdrawal of the complaint was received by us.
2. Following a full investigation of the file, Mr & Mrs Lusted had been sent a full closure letter (at paragraph 54 above). This means that the file had been fully investigated. It was found to be fully compliant, and the client advised, as per the Financial Services Authority requirements, that this was the case. At the time the reference was written we did not know if the client had accepted our findings. However it was factually correct to say a full closure letter had been sent.
3. Following a full investigation of the file, Ms Fordyce had received a response from us but had, without further notice to us, complained to the Financial Services Ombudsman (at paragraph 56 above). The file from the Ombudsman on this matter was received by us at almost the same time as we were completing the reference (2 April 2003). Therefore it was correct to say that one was with the Ombudsman.
I also referred to the complaint from Mr & Mrs Hardy's solicitor. Following a full investigation of the file, it revealed a letter of complaint had been received from a solicitor, on behalf of clients, on or about the same time the reference was being prepared. This letter complained about Mr Dike in connection with an equity release scheme (at paragraph 63 above). Contrary to what the clients declared they had been told, Mr Dike had submitted an invoice to them for services rendered. We had responded to this letter, but had not received a response. Therefore it was correct to report that it was still ongoing.
83.10 Q.10
.
It was clear from the documents before me that there were allegations within the complaints that suggested that best advice had not been given. Such allegations were based on verbal advice given by Mr Dike so there was no written evidence of failure to give best advice. The allegations of a failure to give best advice before me had not been proven at that stage, although the allegations had been made.
I therefore wanted to say that there were allegations in this regard but they had not been proven. I looked again at the complaints we had received regarding the handling of the Fordyce case, and the letters received on the Lusted case.
I read the Fordyce file again as certain remarks made in the letters of complaint to the Ombudsman required further attention.
In Ms Fordyce 's complaint, she stated that Mr Dike had advised her not to repay her mortgage with capital she had received, this being all the capital she had, but to invest it into a medium to high risk investment to produce income that would repay her mortgage.
When she wrote her letter of complaint to Mr Dike, he had returned the letter to her, and telephoned her advising her to alter the wording of it and re-submit it at a later date. She complained that he had advised her to borrow money, even though by then she had lost all her capital. The borrowed money was to be put in an investment based in Florida. To borrow money in these circumstances on the advice of Mr Dike would constitute bad advice being given. This matter was still with the Ombudsman though.
Mr & Mrs Lusted complained about misselling. In a letter dated 2 March 2003 they referred to conversations held with Mr Dike. They wrote: 'We did identify that the content of some unrecorded conversations had greater influence than the published literature on our decision to invest.'
In view of the above, I felt the comments made on the reference were a fair reflection.
83.14 Q.14
.
I re-read Mr Dike's contract with Ziegler Rickman Ltd. This states: 'In the event of the Client (Ziegler Rickman Limited) being held responsible during the term of this contract or at any time thereafter for any action or advice given by the consultant (Dike) to a third party which results in financial cost or loss to the Client, the consultant will indemnify the Client in respect of such liability.'
In view of this, and in view of the outstanding complaint with the Ombudsman, I completed the answer accordingly.
83.17 Q.17
.
Ziegler Rickman Ltd was in the process of changing from being regulated directly by the Financial Services Authority, to becoming a member of a network.
We had offered Mr Dike the opportunity to continue working with us under the new regulatory regime. He advised us he had looked carefully at the network, ISL. However, he had made enquiries regarding the procedures required with regards to compliance and administration under a network and had been advised this would increase.
Bearing that in mind, he advised us that, as he already hated all the administration and compliance that was involved when in receipt of Financial Services Authority direct, and this was likely to increase to a level beyond which he was prepared to work, he would resign from the company when we joined the network This was the only reason he provided for wishing to resign.
83.18 Q.18
.
I only mentioned the two filed complaints of which we had a hard record. Our experience of him during his entire contract period with us was unpleasant.
His attitude towards some members of our female staff consistently over his employment period, was chauvinistic, bullying, degrading and sexually offensive.
We had received several other complaints from the other female members of staff referred to earlier in this witness statement. I did not refer to those in the reference as there was no hard file to support them.
The concern when completing this reference was this. Mr Dike was applying to join an organisation that recruited sales people and others, of both sexes, from a wide variety of the work force available.
Should Mr Dike carry on treating female members of staff employed by St James's Place in the same way as he treated female members of staff with us, then the prospect was that further complaints would be made against him.
We wanted no future comeback on Ziegler Rickman Ltd. from St James's Place.
As we had received two formal complaints and at least four informal complaints I considered that this should be mentioned. In view of this, I referred to the two formal complaints we had received.
We had received complaints from four other female members of staff with regards to his attitude towards them. These ranged from shouting at them, repeatedly banging their desk in temper, touching them inappropriately, and all the other accusations referred to earlier in this witness statement. Therefore, I commented on how he was a difficult person with whom to work and we would not be sorry to lose his services.
In the circumstances I felt these comments were appropriate to the situation. indeed, it seemed very clear to me that the office became a happier place the moment Mr Dike left and as such, those comments were justified. I continue to believe that those comments were justified."
The integrity of Mr Dike
"Please state total commission generated over the last 12 months.
(Please attach copies of commission statements to verify this amount)"
Mr Dike answered that question, "ฃ105,000 gross". That answer was in fact completed by Mr Martin Brunt, a senior sales manager employed by SJP whose function was to seek to recruit people to be associate partners or partners. However, the sheet in question was signed by Mr Dike and dated 10 March 2003. He accepted in cross-examination that he took responsibility for the accuracy of the answer. Mr Dike's annual accounts prepared by his accountant for the year ended 30 June 2003 were put in evidence. Those accounts showed, in the usual way, figures for the previous accounting period by way of comparison. One could thus see that in the year ended 30 June 2003 Mr Dike's turnover was ฃ48,041 and in the previous year was ฃ50,018. Mr Dike was challenged by Mr Self over the apparent discrepancy between his turnover as revealed by his annual accounts and the figure for total commission over the 12 months up to 10 March 2003 stated in the application. This issue arose shortly before the short adjournment on the first day of the trial. At the time it first arose he seemed to accept that he had put in an excessive figure in answer to the question on the application and said that it was a bit like when someone made an application for a mortgage, one tried to make the application look attractive. At that stage he accepted that the figure stated in the application could not be reconciled with the figures in his accounts. I invited him to consider the position further over the short adjournment. After that further consideration he gave two rather different, and complicated, explanations. One was to the effect that the figure stated in the application was the result of making various adjustments to the figures stated in his accounts, for example to take account of the sum which the company retained out of gross commissions which he earned but which were payable in the first instance to the company, which passed on his share after deducting what was due to it. The other was that SJP required figures to be presented in a certain way so that it could compare income which might have been calculated on different bases. Mr Brunt was called as a witness on behalf of Mr Dike. When he was asked about the figure in the application he said that he simply wrote down the figure which Mr Dike gave him. Mr Brunt had no role in determining what that figure should be. I accept the evidence of Mr Brunt on this question. He struck me as a perfectly straightforward witness. Mr Dike's post-adjournment attempts to reconcile the figure stated in the application with the figures stated in his accounts seemed to me to be essentially a "smoke and mirrors" exercise designed to confuse and thereby to avoid the plain and obvious conclusion that he had lied in causing the figure in the application to be completed as ฃ105,000 gross. That is, I find, the true explanation for the discrepancy between the figure in the application and the figures in Mr Dike's accounts.
Compliance issues
"You asked me for a summary of complaints received during my term with Ziegler Rickman Ltd. They all relate to the Split Capital investment saga and have all come within the last 3 months approx.
Complaint client Lusted
Purchased a combination of zeros and income shares. Original complaint was that he was missold as he asked for low risk investments on part of his portfolio (Zeros) and capital has either seriously reduced or been lost. File thoroughly reviewed by Z/R compliance officer who concluded that ID [Mr Dike] did not in any way missell. However responsibility appeared to be pointed to Fund Managers for miscommunicating the risk profiles and the mismanagement of the funds. Client responded to say that he accepted that ID did not misrepresent or missell and asked Z/R to support him in bringing his complaint against the Funds Managers. This is currently the position.
Complaint client Fordyce
This was a high to medium risk client who purchased a selection of income shares with an exceptionally high income. Client admitted to me verbally that she did not hold me responsible for her losses and agreed that I would support her in taking her complaint direct to the Fund Managers for misrepresentation in a similar way to above case. She suddenly, without warning, reverted her position and wrote direct to the Ombudsman complaining that she had been missold. Similarly to above case, Compliance Officer findings from the report were that there was no question of misselling particularly because of the higher level of risk she was prepared to accept. Again client file in watertight condition. We responded to Ombudsman and await his findings. This lady client had previously complained of being missold by a previous IFA before contacting me and as a result I was meticulous in my files to ensure that everything was agreed in writing before the case was submitted.
Complaint client Griffiths
This was a formal letter from my personal secretary addressed to me and not intended to be taken as a complaint by the company but it was and had to be recorded so. Subsequently Miss Griffiths has withdrawn her complaint in writing and requested that the firm supports her in any compensation from the investment companies concerned.
I trust this information is adequate but if you want any expansion please let me know."
Thus at that time Mr Dike recognised, correctly as it seems to me, that the proper way in which to regard the complaint of Miss Griffiths was as a complaint which had been withdrawn, not as a communication which was not a complaint at all.
"It is now fairly obvious that the investments we have made in the split capital funds run by Legg Mason and BFS are now virtually worthless. I have been following the debacle with interest over the past few months and have researched some of the recent history surrounding this type of investments.
It is with some regret that I have to inform you that we wish to formally complain about the advice we were given by you and the subsequent investments we made based upon that advice."
They went on in the letter to elaborate upon the grounds of their complaint, but for present purposes it is not necessary to go into the detail.
"Thank you for your comprehensive response to our complaint concerning the advice given by Ian Dike prior to making our investment in various split capital trusts.
The information you have provided undoubtedly accurately reflects the data held on file by your company and would almost certainly provide sufficient evidence of probity on Ian's part as to make any further pursuance of our complaint at this level a potentially pointless exercise.
However, we do not feel that the file information accurately reflects the enthusiasm for this type of investment that Ian communicated to us during our discussions and that was a significant influence upon our decision to invest. Of course, because of the nature of the investment advice process and the range of the discussion held, very little, other than cold fact would ever be recorded, but I do recall two statements (not verbatim) that were significant:
these type of investment [split-caps] have never failed to pay out yet
I [Ian] have invested a significant sums [sic] of my own money in these investments and will be buying more
We feel that the above type of advice was significantly more influential upon our decision than any published brochure, or any statutory warning words of advice about risk
Our primary aim is to recover the loss on our investments based upon the fact that we have been poorly advised. If the advice given by Ian was misplaced because of the inaccurate information published by the Trust companies then pursuing a claim against them would seem to be the next logical step.
Based upon this approach we shall not take our initial complaint any further, but we may review this decision at a later date. Consequently, we would be interested in receiving your proposals about how such a complaint would be managed by yourselves.
Thank you for you attention to this matter and we look forward to reaching a successful conclusion for us both."
Mr Dike was asked in cross-examination about the alleged two verbal statements set out in the letter. He agreed that he had probably said something to the effect alleged. He did not accept that that was bad advice.
"Any further communication I had with Ian Dike was when I contacted him. After several telephone calls to your office during the following 9 months he offered no help or assistance, in December 2002 I again rang your office to say that I thought I ought to be putting in some sort of complaint to the FSA regarding this investment. He suggested I should go into the office and that he would draw up my letter of complaint in his words and for him to justify it. He also recommended I called in to the office as he was excited about a new product he was researching that would enable me to recuperate some of my lost funds. When I enquired as to where I was funding this scheme he suggested I borrowed it! It was then I emailed Legge Mason and BFS re the risk category. Hence my original letter of complaint dated 28 December 2002. I immediately had a telephone call from Ian Dike (the only one received on his behalf) apart from the call I received on March 28 2002, requesting I withdrew my complaint, re-date this and omit the last paragraph for personal reasons and re-submit it a week later so the complaint would not be received by your office until his return from Florida. I duly did this only to be requested again to withdraw my letter of complaint. It was then I went to the Citizen's Advice Bureau who recommended I forward my complaint to the Financial Ombudsman."
"Further to my letter 0f4thl December 2002, I am sorry that you seem to have decided not to proceed with your application for an Equity Release Plan on your home. I confirm that I did agree that by coming to my offices there would be no charge for your initial enquiry. However as a result of your visit you left me with instructions to carry out further enquiries as to whether the scheme would be applicable in your case due to the term of your lease.
I secured special terms from Northern Rock plc for your case and there have been further telephone calls, illustrations and general advice on the basis of your confirmed interest.
Once again I am sorry that you have not been able to take advantage of this type of scheme which would unquestionably provide a great benefit for you but I am sure you can appreciate that, as Independent Financial Advisers, we have to charge a fee for our services. In the circumstances I have reduced my normal fee of ฃ250 to ฃ125 on the basis of immediate settlement."
"I act on behalf of Mr and Mrs Hardy and they have consulted me following receipt of your letter to them dated 20 February.
Quite frankly my Clients were both astounded and dismayed to receive your letter.
The circumstances as they have relayed them to me were as follows.
My Clients arranged to see you on 18 October last year having made a telephone enquiry about the possibility of their entering into a Home Equity Release Scheme.
You indicated to them that you would waive any enquiry fee if they attended at your offices rather than you involve yourself in a home visit.
They accordingly called to see you where you had prepared an illustration received from Norwich Union.
At that meeting no mention was made of any further fees other than the fact that if they took up the Norwich Union Scheme they would have to pay Norwich Union's solicitor's and valuer's fees.
It was implicit (indeed they seem to recall express) that if the proposal were taken up by Mr and Mrs Hardy you would receive commission as the introducing agent.
Our Clients tell us that they were frankly horrified at the way in which you badgered them to make a swift decision.
You told them that you were shortly leaving on holiday and they had to make their minds up within four days.
We are sure that on reflection you will appreciate that when dealing with elderly people in connection with a matter as sensitive as their own home and only significant asset that it is totally inappropriate for any such pressure to be brought to bear.
They apparently left the meeting shaken, confused and worried
You did indicate that you would make further enquiries to see whether an alternative Scheme with Northern Rock might be available but apparently this was not so available because of the shortness of the unexpired term of their lease.
In the circumstances as adumbrated above our Clients tell us that they do not intend to settle your invoice and that if you persist in pursuing the matter they will seek the intervention of the Financial Services Authority."
"I note from my files that I have still not received any sheets or supporting evidence relating to the above, and as a matter of urgency I would ask you to have these prepared and given to me for the period from 1 April 2000 to 30 June 2000."
Mr Rickman explained in his evidence that details of continuing professional development undertaken in each quarter should be reported as soon as possible after the end of the relevant quarter, and that what this showed was that Mr Dike had not made his return almost three months after the end of the relevant quarter. There was no evidence that Mr Dike failed completely to make the appropriate return, or, assuming he made it at some point, when that was. This did seem to be a minor matter.
50. Mr Norman's main point in relation to compliance issues seemed to be that it was unfair to mention anything in the reference which had not been raised specifically with Mr Dike. However, it seems fairly clear that Mr Dike was fully acquainted with the cases of Mr and Mrs Lusted, Mrs Fordyce and Miss Griffiths and knew what allegations had been made by each of them. He had told Mr Rickman, as I find, that he had passed on to SJP details of all of the complaints against him. Mr Rickman, I find, had told Mr Dike, when the latter mentioned that SJP would be seeking a reference, that he would have to give details of the complaints. In those circumstances, if, which I doubt, there would otherwise have been some obligation on Mr Rickman to inform Mr Dike that he was intending to tell SJP about the complaints which had been made and to give him an opportunity to comment, that had been done in the cases of Mr and Mrs Lusted, Mrs Fordyce and Miss Griffiths, because Mr Dike had been told that those cases would be mentioned. The case of Mr and Mrs Hardy and their solicitors' complaint seems to have been known to Mr Dike prior to the date of the reference, but only to have come to the attention of Mr Rickman whilst he was preparing the reference and at a time when Mr Dike's absence prevented him from discussing it with Mr Dike.
"Initial meeting with Ian Dike. I was looking for extra income, he advised me not to pay off my mortgage but to allow the investments to pay the monthly premiums."
That was plainly highly questionable advice, if given. The obvious safe advice to give was that she should use the capital sum available to her to discharge her mortgage debt.
The other piece of extremely dubious advice which she alleged she had been given, after the original investments had failed, was to seek to recoup her losses by borrowing to invest in Mr Dike's Florida scheme.
Mr Dike as a work colleague
"3. From the time that I started working for Mr Dike, he would regularly make little comments on how I was dressed I felt increasingly uncomfortable with these comments and they began to sound more and more 'sleazy' to me.
4. For example, on one occasion in the first month, when I was wearing a v-neck blouse I was greeted by Mr Dike with 'Morning, don't you look buxom today'. On other occasions, if I was wearing a knee length skirt, he would comment on my legs or ankles. He made it quite clear that he did not like his 'ladies' to wear trousers to work, although there was no specific statement that I can recall him making to that effect.
5. These comments began to be made on a daily basis and I was always aware that I had been carefully looked at. His comments were far too specific to be appropriate in an office environment.
6. As the verbal comments became more frequent, so too would the invasion of my personal space. My office was at the front of the building, next to Claire Riley's office, and I shared my office with Janet Hathaway, who was Mr Dike's assistant. The two desks faced the wall at the front of the building and the door to the office was behind the two desk chairs.
7. When I was at my desk, Mr Dike would stand so close to the side of my chair that he would actually brush his leg, hip and groin against my arm and shoulder whilst I was sitting down, I would have to move away or make an excuse to stand up. He would also lean right over so he could see down my top. He was much closer than would ever be necessary.
.
13. Mr, Dike could also be extremely selfish and insensitive. In July, when my father was gravely ill in intensive care with cancer, I telephoned Nikki Kerr over the weekend to ask her to pass a message to Mr Dike on the Monday morning to the effect that I would not be in the office on Monday. My father's condition had worsened considerably over the weekend. I said I would try and pop in later in the week to do the urgent work I did not have a number for Mr Dike as I was in Buckinghamshire with my fat her.
14. I popped into the office on Wednesday to ensure that the message has got through and to see if there was anything urgent that I could help with. Mr Dike was extremely rude and aggressive to me and shouted at me for not telling him directly that I would be away from Monday. He told me he should not have had to hear it from Nikki downstairs and he was 'offended' by that. He made no effort to find out how I was or how my father was.
15. I was in emotional turmoil at the time and if it had not been so difficult for me, I would probably have told him what I thought of him. However, I fled the office in tears after being treated with such an appalling lack of consideration.
16. I ran across the road to an alleyway alongside the shop over the road. Nikki Kerr came out to see what was wrong and I told her about Mr Dike 's reaction. I was so upset that I needed time to cool down, so I went home and did not return until the following Monday. Nikki went and got my coat and bag and brought it to me at home shortly afterwards."
"2. I found Mr Dike to be a very aggressive person to work for. On one occasion, towards the end of my time working for him, Mr Dike came into my office and shouted at me repeatedly whilst thumping his fist on the desk so that other members of staff could hear him. Naturally, this incident reduced me to tears and I had to leave the room. I went and spoke to Mr, Rickman, who was one of the Directors of Ziegler Rickman Limited and told him of the incident.
3. In addition, Mr Dike behaved in a very unprofessional way towards me. At the beginning of my time at Ziegler Rickman Limited, he would constantly stand too close to me or reach across in front of me for something from my desk instead of simply asking for it. He would also make contact by brushing his forearm against mine when he stood next to me and he continually invaded my personal space. When I first worked for him, he put his arm around my waist a couple of times.
4. I would always make a point of moving away from Mr Dike in an exaggerated way to make clear my dislike of his actions but this never seemed to have any effect."
In cross-examination Lorraine Cox clarified her evidence to make plain that, while the incidents in which Mr Dike put his arm round her waist were only at the start of her employment, the other behaviour which she mentioned continued throughout. She was asked why she did not seek the assistance of Mrs Hathaway in getting Mr Dike to change his behaviour. Her response was that she thought that Mrs Hathaway would deny that there was a problem or make excuses. Mrs Hathaway was called as a witness on behalf of Mr Dike and she did say that she was not aware of any difficulties in his relationships with others working in the offices. However, my assessment of Mrs Hathaway was the same as that of Lorraine Cox. I did not find the evidence of Mrs Hathaway of assistance.
64. Chronologically the next thing which happened which is relevant to the aspect of the case which I am now considering was probably that Carol Darling made a complaint about Mr Dike. I say that that was probably the next relevant incident because the evidence was unclear as to the date of a barbecue at which there was a relevant incident, to which I shall come shortly. Carol Darling was an employee of the company at the time. She did not give evidence before me. The evidence of Mr Ziegler was that she came to him at a time when Mr Rickman was on holiday in May 2001 and complained that Mr Dike had been touching her clothing in a way which caused her concern and that he was becoming over-familiar and causing her embarrassment. He would rub the fabric of her clothes between his thumb and forefinger and comment upon the quality of the fabric. She also complained that on one occasion he had purported to look closely at a brooch she was wearing and had taken the opportunity to look down her dress. Carol Darling wanted the matter dealt with formally. Mr Ziegler therefore wrote a letter dated 16 May 2001 to Mr Dike, in which he said this:
"I have received a verbal complaint from one of the female staff in the office as regards the way you deal with them, as they feel that you have become over familiar, which is causing them embarrassment.
I am sure that your actions are not deliberate, but must ask you to exercise extreme caution in the future as regards the way you deal with any female staff in this office so as to ensure that a similar situation does not arise again."
"I recall the written complaint from W Ziegler concerning Carol Darling in May 2001 very well and already have made a full statement. I did not know until now that the touching of her jacket had been the problem. It is something that I occasionally do with people (not just females) by way of complimenting them on their good dress. Not any more. I therefore do not deny that I may have done this on one or possibly two occasions."
In his original witness statement what he said about the matter was:
"27. The first letter of complaint which was held on my file related to an incident in May 2001. At that time, I was presented with a formal letter from Mr W. Ziegler, without warning, stating that one of the secretaries had verbally complained about the way I dealt with them, which had apparently caused them embarrassment. I did not know who the person was. I was extremely upset and categorically denied being responsible for any inappropriate behaviour. I immediately responded with a formal letter to Mr W Ziegler dated the 17 May 2001 denying the incident and stating that this letter of complaint was severely damaging to my previous unblemished professional record.
28. In my letter I asked for details of the incident in question but nothing was produced I threatened to take legal action unless the unfounded accusation was withdrawn, Mr W Ziegler however strongly recommended that I took no further action for two reasons. Firstly there had been a similar incident with the same staff member and another member of the company and the staff member involved was currently of a sensitive nature for various reasons. Secondly he assured me that the file note would be removed after twelve months and that the matter would be forgotten. In reliance of this therefore, and in the interests of sustaining a relaxed working environment, I did not proceed with any legal action. I did however write a personal letter to the staff member apologising if indeed I had caused any embarrassment to her, and assuring her it was by no means intended. I asked if she could kindly acknowledge the letter, however regrettably she did not respond."
"I refer to your letter of16 May which I received incredulously and with shock and anger.
I flatly deny any accusation, deliberate or otherwise of being "familiar to the point of embarrassment" with any member of the female staff.
On the matter of complaints concerning my association with the firm and its staff if anyone had grounds to make complaints it would in fact be me on the basis of previous incidents concerning both poor performance and harassment, evidence of which is documented.
I regard this complaint as entirely untrue, nonsensical, entirely unproven and libellous, and therefore damaging to my unblemished professional record. However I would be happy to receive details of incidents, together with times, dates and any witnesses as to causes of such embarrassment.
As this matter has already been recorded and is now filed as a blemish on my personal and professional character, I intend to seek redress through legal channels.
Before pursuing this route however, I shall give the female staff member concerned 48 hours to reconsider her position, withdraw the accusation and apologise. Failure to receive such I will have no hesitation in pursuing the matter as promised.
Naturally I do regret your involvement William and hope very much for a swift end to the matter as requested."
"After much thought and discussion with my private family I have decided initially to write to you personally. Your allegations, resulting in a formal warning letter placed on my file, have caused both me and my wife great personal upset. It is possible you are not aware of the possible implications.
I really thought we had a good professional relationship, you have been particularly helpful with my messages etc and I believe I have told you so. You have stated that I am over familiar and have embarrassed you. How have I managed to do that? I am happily married with two lovely children. I am simply not interested in you. I am very, very upset however, if I have embarrassed you somehow. I apologise. I would be very grateful if you could acknowledge that you have received this letter, have a chat with me or telephone me at home. My no. is 01258-840136. A pity that another way to deal with the situation couldn't have been found I dislike incidents of this sort being left incomplete particularly when I believe fundamentally there is no real cause for concern."
"There is an accusation by Claire that I had brushed crumbs from her breast at this BBQ. I repeat that I do not believe I was at this BBQ. Whilst I cannot recall the incident perhaps it is possible that I may have done so at another event, but it is not something that I would normally do. If I did do something of that nature which I knew to have caused such offence as described, I would have immediately apologised."
His evidence about it in cross-examination was to the same effect.
"6. At work, Mr Dike's general behaviour made me feel uncomfortable and was often with a sexual undertone with his mannerisms. When in his presence, he would make suggestive noises and remarks. One frequent comment concerned a striped French looking jumper and whenever I was wearing it, he would say 'oh, you're wearing that French outfit again' and after this statement would make a suggestive growling noise in his throat. I felt this was totally inappropriate behaviour in an office environment and I disliked such comments.
7. He would have a habit of coming too close to me when making conversation making me feel very uneasy whilst giving me the impression that he was trying to undress me with his eyes. His behaviour was so degrading that I reported this to my husband Nick He said he would have a serious word with him if this continued It came to the point that I tried to keep out of his way, but this was sometimes difficult as we both worked on the 1st floor, I avoided any contact with him where I could.
8. As my office was next to the office of Mr Dike 's personal assistant, I did hear various conversations between Mr Dike and his various personal assistants. Especially with Lorraine Cox, he showed her no respect and was very impatient and she would inevitably get upset. I would not have been able to work with him."
"4. During this time [Mr Dike's period working with the company] I was totally unaware of any stories or rumours of inappropriate behaviour."
Mr Gilderdale employed no staff. Mrs Hathaway was, of course, another exception.
Mrs Hopper the facts
"5. The incident that led to me making my first complaint about Mr Dike to my employer, Trevor Jackson, revolved around a teapot that I found in his office. Whilst I was cleaning his office, I collected an old teapot to clean and accidentally broke the handle whilst washing it up. I didn't realise that it belonged to Mr Dike but I replaced it with a similar teapot the same day.
6. Approximately 2 months later, Mr Dike approached me whilst I was cleaning his office and asked if I had broken his teapot. I explained what had happened and he said that he was not happy with the replacement and he had bought another teapot. He went on to say that, 'If you break this teapot I will smack your bottom'."
"I introduced myself to Mr Dike and requested that he throw away any old food in his office as removing food and washing up was not included within our contract. I also asked him to refrain from making 'off the cuff' comments to Carol, even if he felt they were meaningless as we did not expect anyone to make such remarks to any of our staff Mr Dike denied that any such incident had happened."
I accept the evidence of Mr Jackson that he had a conversation with Mr Dike within a day or two of receiving the complaint from Mrs Hopper and that the effect of the conversation was as he said in his witness statement. While that account was somewhat vague, I am satisfied that Mr Dike must have known what prompted a visit from the cleaners, otherwise he would have made plain to Mr Jackson that he did not know why he had come or what he was talking about. In fact Mr Dike denied to Mr Jackson making any "off the cuff" comments to Mrs Hopper. As civilised conversation is perfectly innocent, he must have known perfectly well to what comments Mr Jackson was referring.
"Further to our various telephone conversations I am writing to confirm that last week we had an incident reported by our Cleaning Operative, Carole Hooper [sic].
On my weekly visit to your office last Wednesday ~ September, I received a telephone call from Carole Hooper, our cleaner, who mentioned that she had a few problems with Ian at your office. He had passed several sexiest [sic] remarks and she felt that he expected her to pick up and dispose of old food from his office floor. She wanted me to be aware of the situation and I felt that I must advise you.
Carole also mentioned that she did not want me to take it too far as she did not want to feel vulnerable being left in the building on her own.
As we discussed, I saw Ian on Thursday 26 September, and introduced myself asking him to throw old food away and refrain from 'off the cuff comments' to Carole, even if he felt they were insignificant and meaningless.
I hope that this situation has now been dealt with and there will be no further repercussions.
I have also asked Carole to inform us immediately, should the problem reoccur in order that it can be dealt with immediately."
Sexual harassment
"(1) For the purposes of these Regulations, a person ("A") subjects another person ("B") to harassment where, on the grounds of sexual orientation, A engages in unwanted conduct which has the purpose or effect of
(a) violating B's dignity; or
(b) creating an intimidating, hostile, degrading, humiliating or offensive environment for B.
(2) Conduct shall be regarded as having the effect specified in paragraph (1)(a) or (b) only if having regard to all the circumstances, including in particular the perception of B, it should reasonably be considered as having that effect."
What, I think, Mr Norman sought to derive from the dictionary definition was that the concept of harassment involved a degree of persistence, although that did not seem to be an ingredient of the definition in reg. 5 of Employment Equality (Sexual Orientation) Regulations 2003. From the latter Mr Norman sought to derive the proposition that conduct should only be regarded as harassment if it could reasonably be considered as having the effect provided for in reg 5(1)(a) or (b). From time to time during his submissions Mr Norman also seemed to suggest that sexual harassment could not take place unless such was intended by the alleged harasser, or he was at least aware of what he was doing.
"conduct of a sexual nature, or other conduct based on sex affecting the dignity of women and men at work, including conduct of superiors and colleagues, is unacceptable if
(a) such conduct is unwanted, unreasonable and offensive to the recipient;
(b) a person's rejection of or submission to such conduct on the part of employers or workers (including superiors or colleagues) is used explicitly or implicitly as a basis for a decision which affects that person's access to vocational training, access to employment, continued employment, promotion, salary or other employment decisions; and/or
(c) such conduct creates an intimidating, hostile or humiliating work environment for the recipient."
What was important about that test, submitted Mr Self, was that the determining criterion of harassment or not was simply the perception of the supposed victim. Considerations of the intentions of the supposed harasser or an objective assessment of the quality of the matters complained of were simply immaterial.
"Sexual harassment means 'unwanted conduct of a sexual nature, or other conduct based on sex affecting the dignity of women and men at work'. This can include unwelcome physical, verbal or non-verbal conduct.
Thus, a range of behaviour may be considered to constitute sexual harassment. It is unacceptable if such conduct is unwanted, unreasonable and offensive to the recipient; a person's rejection of or submission to such conduct on the part of employers or workers (including superiors and colleagues) is used explicitly or implicitly as a basis for a decision which affects that person's access to vocational training or to employment, continued employment, promotion, salary or any other employment decisions; and/or such conduct creates an intimidating, hostile or humiliating working environment for the recipient.
The essential characteristic of sexual harassment is that it is unwanted by the recipient, that it is for each individual to determine what behaviour is acceptable to them and what they regard as offensive. Sexual attention becomes sexual harassment if it is persisted in once it has been made clear that it is regarded by the recipient as offensive, although one incident of harassment may constitute sexual harassment if sufficiently serious. It is the unwanted nature of the conduct which distinguishes sexual harassment from friendly behaviour, which is welcome and mutual."
"It seems to us important to stress at the outset that "sexual harassment" is not defined by statute. It is a colloquial expression which describes one form of discrimination in the workplace made unlawful by s. 6 of the Sex Discrimination Act 1975. Because it is not a precise or defined phrase, its use, without regard to s 6, can lead to confusion. Under s 6 it is unlawful to subject a person to a "detriment" on the grounds of their sex. Sexual harassment is a shorthand for describing a type of detriment. The word detriment is not further defined and its scope is to be defined by the fact-finding tribunal on a commonsense basis by reference to the facts of each particular case. The question in each case is whether the alleged victim has been subjected to a detriment and, second, was it on the grounds of sex. Motive and intention of the alleged discriminator is not an essential ingredient, as in any other direct discrimination case, although it will often be a relevant factor to take into account. Lack of intent is not a defence."
Later in the decision, at paragraph 30, the tribunal said:
"As to whether the conduct is unwelcome, there may well be difficult factual issues to resolve. In general terms, some conduct, if not expressly invited, could properly be described as unwelcome. A woman does not, for example, have to make it clear in advance that she does not want to be touched in a sexual manner. At the lower end of the scale, a woman may appear, objectively, to be unduly sensitive to what might otherwise be regarded as unexceptional behaviour. But because it is for each person to define their own levels of acceptance, the question would then be whether by words or conduct she had made it clear that she found such conduct unwelcome. It is not necessary for a woman to make a public fuss to indicate her disapproval; walking out of the room may be sufficient. Tribunals will be sensitive to the problems that victims may face in dealing with a man, perhaps in a senior position to herself who will be likely to deny that he was doing anything untoward and whose defence may often be that the victim was being over-sensitive. Provided that any reasonable person would understand her to be rejecting the conduct of which she was complaining, continuation of the conduct would, generally, be regarded as harassment. But at all times, the tribunal should not lose sight of the question at issue: was the applicant subjected to a detriment on the grounds of her sex? The answer to that question does not depend upon the number of incidents. A one-off act may be sufficient to damage her working environment and constitute a barrier to sexual equality in the workplace, which would constitute a detriment."
"We have received two complaints of sexual harassment from a secretary and outside cleaner. Mr Dike has been cautioned for both complaints which he denied No further action resulted."
The cautions were that in the letter of 16 May 2001 written by Mr Ziegler and the mild reproof administered during the interview with Mr Jackson in September 2002. The recording of the fact that Mr Dike denied the incidents and of the fact that no further action resulted seems to me to convey to the reader of the reference both that the incidents were minor, such that no further action was necessary notwithstanding the denials, and that there had been no repetition.
The reference conclusions
"The claimant was unsuitable for employment (whether under a contract of service or contract for services) as an adviser in the financial services industry"
did seem to me to be inserting a gloss upon it. The fact that Mr Dike was difficult to work with did not make him unsuitable for employment. It just meant that a prospective employer would have to decide whether the other qualities which Mr Dike had to bring to a job outweighed such difficulties. His attitude to compliance meant that he probably needed further training in that area and perhaps careful monitoring, but again it was for a prospective employer to decide whether those aspects were outweighed by other qualities. The mention of complaints of sexual harassment, which were denied and in respect of which no further action had been taken after caution, just alerted a prospective employer to a potential problem, which might not be of any relevance, depending upon the prospective working environment. The overall message in the reference, in my judgment, was not that Mr Dike should not be employed at all, but rather, that if he were to be employed, certain matters those to which I have referred in this paragraph would need to be taken into account and his performance in those areas at least monitored.
Causation
"Further to our telephone conversation please find enclosed a copy of the reference provided by Mr Rickman on behalf of your company.
If after reading the reference you feel you would like to provide us with a more detailed explanation then I would appreciate your comments in writing. On receipt of this then we may be able to reconsider Mr Dike's application to join St. James 's Place Partnership.
Thank you for your assistance so far and I look forward to hearing from you."
Thus from 22 April 2003 SJP was indicating a willingness to reconsider the application of Mr Dike, and that is what happened. The letter and its enclosure were copied for Mr Dike by Mr Fogg. When precisely Mr Dike received the copies was not clear, but he certainly had them by 27 April 2003.
"Very recently I received, just prior to my holiday, a letter from a solicitor complaining about sending an agreed fee to a prospective client over an equity release situation. Mr Rickman replied agreeing that my actions were entirely reasonable but in any event as it was an unregulated product which had not in fact even been sold, it was not covered by the FSA. I would be delighted to provide full details on any or all of the above complaints."
In due course Mr Dike was asked to provide more details of the complaints relating to split capital investment trusts. I have already set out the relevant terms of the document in which he did so, entitled "Previous Complaints".
"I have had a look at the evidence of earnings you have supplied to prove the Entry Level of ฃ75K, and discussed with Jon Groocock, we feel there are two points to cover:
1. From the invoices you have supplied (10 months) I am unable to prove the ฃ105K, even the total of the Credits only come to ฃ69K, can you expand in any way what figures are on these invoices.
2. As the letter confirming ฃ105K has been written by Ian himself we will require further supporting documentation of some kind, ie breakdown of commission records or bank statements showing payments, even something written from Ziegler might be acceptable let me know what you think you can supply."
It does not appear that any further evidence of earnings ever was supplied or that Mr Brunt responded to this e-mail.
"reference from Ziegler Insurance has complaints, states that Ian is a difficult person with whom to work and they are not sorry to lose him. Also they have had complaints of sexual harassment."
It does not appear that the author of that document had interpreted the reference as meaning that the complaints, of sexual harassment or otherwise, had been made out. Issues of compliance were not mentioned.
"7. I would wish to make clear that the complaints regarding the sale of Split caps related to clients claiming that the investments did not match the investors risk profiles. In all cases the risk profile of the investments as per the company literature, did match with the clients risk profile and this is demonstrated on file.
As we all know things have gone very wrong in this market and a number of companies are being investigated. These sales were based on the information supplied by the companies and I, as the compliance officer for the company, feel that they were compliant. I have advised the clients accordingly. One client did not accept my findings and has submitted her case to the Ombudsman.
The case relating to the equity release concerned a fee for work carried out on behalf of the client by Mr Dike, which was raised as they chose not to proceed. Since the date of the reference it has been settled to our satisfaction.
17. Mr Dike, along with the rest of us is not a lover of compliance or administration work This is not to say that he did not do it, but as with everybody it is nearly impossible to dot ever[y] "i" every time. However I can confirm that there were no occasions on which a formal warning was required. As with all of us, everyday compliance issues raise their head, hence my answer to that question.
It might also be worth commenting that Mr Dike has said that he would prefer to be in an organisation such as yours that provides a more structured environment and support especially with regards to this issue.
18. This was a difficult one. My understanding is that I either had a choice of not giving a reference at all, or that if I did, then I had a duty to answer any questions truthfully and disclose anything that might be deemed a material fact. Failure to do so could, in the worst instance, result in an accusation against us that we had failed to do so. This comment in fact relates to all the questions.
It is a fact that there have been two allegations made against Mr Dike. They related to remarks\comments that are alleged to have been made by him to two females working in our offices. There was no question of accusations of anything other than verbal remarks.
One complaint was made verbally by a secretary who works directly for us, whilst the other one was made by an employee of an outside cleaning company to her employer, and then by him to us.
Mr Dike rebutted both cases strenuously. Mr Dike was not a direct employee of ours but works on a self employed contract. Therefore with regards to the outside cleaning company, we allowed him to deal with this situation directly, which, as was confirmed by the cleaning company in writing, he did No further action was taken by either party. The employer then confirmed in writing to me that he had met with Mr Dike and discussed the matter. He hoped the matter had been dealt with and there would be no further repercussions.
With regards to our secretary, we dealt with this internally. No further complaint has been made by that member of staff and I would also mention that they have all continued to work together under the same roof since.
My fellow director, Mr Ziegler, did however write to him after the situation involving our employee asking him to take great caution so as to avoid any future comments that could be misconstrued We felt that as a complaint had been made by a member of our staff we had a duty to put something in writing.
In completing this form it was not my intention to give the impression that Mr Dike was an unsuitable person for you to employ. I would point out that if we, as a company, had felt that he was a liability to the company, we would have terminated our contract with him. This is not the case, his application to you being driven by changes to the circumstances of Ziegler Rickman Ltd.
Lastly, and as stated earlier, it was my duty to complete your reference accurately and honestly. I am rather surprised that if there were issues contained in it that concerned you, you did not refer to me at that stage for fuller details, rather than take the course of action you did.
I trust this additional information is of help to you."
"Following our discussion regarding the above [Mr Dike] and my telephone conversation with Ian Dyke [sic], I can confirm the following points:
Ian is heavily into the Equity Release market with 50 per cent of his business coming from this route. The advice appears to be normally given to elderly women.
The proceeds from the Equity Release are used for investment for immediate income. Ian does not currently carry out a comparison of income producing Equity Release v. lump sum Equity Release to ensure appropriate advice.
Ian does not have MAQ or CeMap which he must have to give advice on Equity Release. Potentially he has been giving unauthorised mortgage advice as an IFA.
Martin [Brunt] has sent me some of Ian's Product Confirmation/Suitability Letters regarding the Equity Release advice he has given and while he has not made any exaggerations regarding the contract, he has not confirmed why the advice is appropriate for the client. I am concerned that if a future compliant [sic] is instigated that Ian would have no defence and could we be left paying up due to retrospective P1 cover?
Emma has also just received another reference confirming that Ian 's contract was terminated due to incompatibility."
That reference was, of course, that from Montague.
110. Notwithstanding the matters to which I have already referred, in an e-mail to Jane McTigue sent on 8 May 2003, Mr Peter Glew of SJP seemed to think that things for Mr Dike were looking encouraging. Mr Glew wrote:
"as discussed yesterday. I am moving forward cautiously with Ian and intend to meet him this week to bottom out the equity release issue which Martin Brunt has fully discussed and got Ian to sigh [sic] the mortgage update 07 which covers our position on this market.
Your view on the fuller reference would be appreciated so that if I get comfortable with his marketing we can proceed quickly."
The "fuller reference" seems to be a reference to Mr Rickman's letter of 28 April 2003, while the "marketing" appears to refer back to Mr Johnson's e-mail of 7 May 2003 about equity release schemes.
"Further to our recent discussions, I am writing to confirm that we will not be proceeding with your application to join St James's Place.
We have reached this decision following consideration of the references received from your previous positions and having taken into account the points made in your letter of 24 April 2003. We also take into account other factors relating to your existing business practice.
I am sorry that on this occasion your application has not been successful."
Overall conclusion
