Communicated on 7 January 2016

FIRST SECTION

Application no. 181/14 Christopher Adrian GADD against the United Kingdom lodged on 27 November 2013

STATEMENT OF FACTS

The applicant, Mr Christopher Adrian Gadd, is a British national who was born in 1969 and lives in Hampshire. He is represented before the Court by Mr E. Metcalfe, a barrister practising in London.

A. The circumstances of the case

The facts of the case, as submitted by the applicant, may be summarised as follows.

1. The factual background

The applicant qualified as a solicitor on 1 September 2006. He joined the firm WB Legal LLP (“WBL”) in March 2008. At that time WBL was a limited liability partnership with two members, namely Mr Mark Bronzite, the managing partner, and a private company called WB Legal Training Limited (“WBLTL”).

On 31 August 2008 the applicant became a salaried partner of WBL and a director of WBLTL.

Before the applicant joined WBL, the firm had been under investigation by the Solicitor ’ s Regulation Authority (“SRA”) in relation to shortfalls in its client account. The applicant claims that he had not known about the investigation when he joined the firm. However, after he became a salaried partner of WBL and a director o f WBLTL he became aware that Mr Bronzite was defrauding clients and reported him to the SRA. Mr Bronzite resigned from WBL and WBLTL in January 2009 and was later struck off the roll of solicitors.

Following Mr Bronzite ’ s resignation, the applicant continued to practice through WBL. As three years ’ post-qualification experience was required before a solicitor could supervise a practice al one, another solicitor, Mr Paul Windsor, became a member of WBL and a director of WBLTL.

WBL remained in financial difficulty a nd was purportedly closed on 30 March 2009. On 2 April 2009 WBLTL, which was already authorised by the SRA to trade as a solicitor ’ s practice, was renamed Christopher Gadd Limited (“CGL”). Thereafter the applicant and Mr Windsor practised through CGL, taking some of the client files of WBL with them.

On 3 April 2009 WBL was placed into administration by one of its creditors.

On 18 May 2009 the SRA wrote to the applicant reminding him that he and Mr Windsor were responsible for the files, documents, and client money of WBL. In that letter it stated that it was satisfied, in light of assurances previously given by the applicant, that he and Mr Windsor had attended to the closure of WBL correctly, but warned that the matter could be re-investigated in future.

On 2 September 2009 Mr Windsor resigned from CGL as the applicant, having achieved three years ’ post qualification experience, was qualified to supervise the practice alone.

2. The SRA intervention

On 4 September 2009 the SRA informed the applicant that information received from WBL ’ s administrators suggested that the closure of the firm had not been dealt with in accordance with its regulatory requirements.

On 15 and 16 September 2009 members of the SRA ’ s Practice Standards Unit visited the offices of CGL to assess that firm ’ s compliance with the Solicitors ’ Account Rules (“the Rules”), the Solicitor ’ s Code of Conduct (“the Code”) and other issued codes and guidance. The resulting report dated 28 September 2009 was sent to the applicant. It identified a number of breaches and requested confirmation that these would be rectified.

On 19 October 2009 the SRA ’ s Forensic Investigation Unit commenced an investigation into WBL. On 18 November 2009 a Forensic Investigation Report (“the Report”) concluded, inter alia , that CGL appeared to be the successor practice to WBL; that the administrators of WBL had complained that the applicant had not been helpful in effecting the administration of the firm; that the administrators had received a number of enquiries and complaints from former clients of WBL; and that the client account of WBL appeared to have a shortfall of almost GBP 240,000.

The Report formed the basis of a case-note submitted to the SRA ’ s Panel of Adjudicators. The case-note identified a number of breaches of the Rules and the Code in respect of WBL and recommended that the SRA exercise its powers of intervention in respect of WBL and any other firm or recognised body of which the applicant or Mr Windsor were members, directors, managers or owners in order to protect the interests of the clients and former clients of WBL. The case-note indicated that due to the urgency of the matter no explanation had been sought from the applicant or Mr Windsor.

On 7 December 2009 the Panel resolved to exercise its powers in accordance with the recommendations made in the case-note. As a result the accounts of both WBL and CGL were frozen and the applicant ’ s practising certificate was automatically suspended, leaving him unable to practise. Control of CGL passed to a nominated agent appointed by the SRA to manage the firm. The case was referred to the Solicitor ’ s Disciplinary Tribunal (“the Tribunal”).

The applicant was notified of the intervention by fax on the same day. The notice indicated the terms of the Panel ’ s resolution but the applicant was not provided with a copy of the Report or the case-note. In the course of a telephone call with the SRA on 7 D ecember 2009 and a meeting on 8 December 2009 the applicant was informed that under paragraph 6(4) of Schedule 1 to the Solicitors ’ Act 1974 (“the 1974 Act”) he was entitled to apply to the High Court within eight days of the service of the notice for an order directing its withdrawal.

On 17 December 2009 the SRA disclosed the Report to the applicant and requested his explanation of the issues identified within it.

The applicant subsequently applied to the SRA for his practising certificate to be reinstated. On 4 January 2010 it was restored subject to a number of restrictive conditions. However, CGL remained under the control of the SRA ’ s nominated agents and was eventually placed into administration on 16 April 2010. The applicant was unable to obtain alternative employment as a solicitor due to the outstanding disciplinary proceedings against him.

The professional disciplinary proceedings against the applicant came before the Tribunal on 13 December 2010. The Tribunal found that there had been breaches of the Code and the Rules in respect of both WBL and CGL but it did not find that the applicant had been dishonest or reckless. It ordered that the applicant be suspended from practice as a solicitor for a period of six months commencing on 13 December 2010 and recommended to the SRA that following the end of the suspension period he should only practise in approved employment.

3. Proceedings under the Human Rights Act 1998

On 6 December 2010 the applicant had issued a claim for damages against the SRA in the High Court under the Human Rights Act 1998 (“HRA 1998”). The particulars of claim dated 24 March 2011 asserted, inter alia , that there had been a breach of Article 6 § 1 of the Convention because the SRA had failed to give the applicant an opportunity to respond to the contents of the Report before its intervention; he had been unable to bring a challenge to the intervention in the High Court within the statutory eight-day period because he had no independent wealth and all of CGL ’ s funds had been frozen as a result of the intervention; and that the eight-day period was unreasonably short. He further claimed that there had been a breach of Article 1 of Protocol No. 1 to the Convention because, by reason of his inability to challenge the intervention, he had been deprived of his property rights in CGL and his licence to practise as a solicitor. He argued that, had he been able to challenge the intervention into CGL, he would have been able to show that it was unjustified and/or disproportionate.

The SRA applied to strike out the applicant ’ s claim and/or for summary judgment to be entered in its favour.

On 13 April 2012 the applicant applied for permission to amend his particulars of claim to assert, inter alia , that even if the intervention regime was in general compatible with the HRA 1998, the manner in which it was operated by the SRA had breached his Convention rights on the specific facts of his case.

Both applications came before Mrs Justice Sharp on 19 April 2012. She held that the claim in relation to the statutory time-limit was hopeless and doomed to failure because domestic authority, in particular the decision of the Court of Appeal in Holder v. The Law Society [2003] 1 WLR 1059, had established that the statutory scheme for intervention was compatible with the HRA 1998 and, in any event, since the limitation period was prescribed in statute, the SRA could not be held liable in damages for any breaches of the applicant ’ s human rights that might result from it. On the facts of the case at hand, she noted that the applicant ’ s claim was academic since he had not sought to challenge the intervention within any other period which he himself considered reasonable but instead had waited twelve months before bringing a claim by a different and inappropriate procedure (the claim under the HRA 1998).

The Judge further found no evidence that the applicant had lacked sufficient resources to challenge the intervention within the eight-day period. All that would have been required in the first instance was the court fee to issue a claim and it would have been open to him to apply to the SRA ’ s nominated agent for the release of some of CGL ’ s frozen funds to use for that purpose. The Judge further considered that all other matters about which the applicant complained could and should have been raised via the statutory procedure, during which the Report and the case-note would have been disclosed. His claim was therefore an attempt to circumvent the statutory limitation on the right to challenge the intervention which amounted to an abuse of process.

The Judge refused the application for permission to amend the particulars of claim and ordered summary judgment to be entered in favour of the SRA.

On 10 May 2012 the applicant applied for permission to appeal the Judge ’ s order. Permission was refused on the papers. The application was then renewed orally before the Court of Appeal on 6 June 2013 but permission to appeal was again refused.

In refusing permission to appeal, the Court of Appeal found that even if the HRA 1998 permitted the eight-day time limit to be read down in exceptional cases, this was not an exceptional case. First, impecuniosity was not a justifiable basis for not having brought a statutory challenge in time. The proceedings in the present case were not especially complex and the applicant was a solicitor who should have been well able to deal with the allegations against him. It was therefore not arguably necessary that he should have been provided with legal assistance.

Secondly, although the court found it “difficult to understand” why the Report and the case-note had not been disclosed to the applicant prior to the expiry of the eight-day time limit, and accepted that it may have been difficult for him to pursue proceedings without the Report, on the facts of the case it did not consider this to be a ground for reading down the eight-day time limit. In particular, it noted that the basis of the applicant ’ s complaint was essentially that he had acted in good faith and co-operated with the authorities in relation to the wind-up of WBL, and those were matters which had been known to him when he received the original notice of intervention. Furthermore, even if some departure from the eight-day period was justified, it was plainly critical for the applicant to act very speedily thereafter. However, while he did take steps to get himself put back on to the register so that he could practise as a solicitor, he had taken no steps in relation to the intervention for twelve months.

B. Relevant domestic law and practice

1. The power of intervention

The Law Society is the governing body of the solicitors ’ profession. It has a regulatory function and regulatory powers under the Solicitor ’ s Act 1974 (“The 1974 Act”), which it exercises through the Solicitors ’ Regulation Authority. Under section 35 of the 1974 Act, the Law Society is given the power to intervene in a solicitor ’ s practice in circumstances specified in Part I of Schedule 1 to the 1974 Act by exercising any or all of the powers set out in Part II of Schedule 1.

Paragraph 1(1) of Part I to Schedule 1 provides that the Law Society may exercise its right of intervention inter alia where it has reason to suspect dishonesty on the part of a solicitor in connection with that solicitor ’ s practice or in connection with any trust of which that solicitor is or formerly was a trustee; where it is satisfied that a solicitor has failed to comply with rules as to professional practice, conduct and discipline; and where it is satisfied that it is necessary to protect the interests of clients (or former or potential clients) of the solicitor or his firm.

Part II of Schedule 1 sets out the powers available to the Law Society upon intervention. Under paragraph 6, the Law Society has the power to take control of the practice ’ s accounts.

Finally, section 15 of the 1974 Act provides for the suspension of the solicitor ’ s practising certificate in the event of an intervention.

2. The right to apply to the High Court

The 1974 Act allows an intervened-upon solicitor to apply to the High Court to request the withdrawal of an intervention. Under paragraph 6(4) of Schedule 1, a decision to take possession of the practice monies can be challenged within eight days of the service of the notice by application to the High Court for an order directing the Law Society to withdraw the notice, with not less than forty-eight hours ’ notice to the Law Society. Paragraph 6(5) provides that upon an application under paragraph 6(4), the Court may make such an order as it thinks fit.

3. The right to apply for the reinstatement of the practising certificate

Under section 16(3), a solicitor may, at any time before the expiry of her practising certificate, apply to the Law Society to have the suspension of the certificate terminated. Under section 16(4), upon receipt of an application, the Law Society may terminate the suspension either unconditionally or subject to such conditions as the Society may think fit.

If the Law Society refuses the application or terminates the suspension subject to conditions, the solicitor may appeal against that decision.

4. The Solicitors ’ Rules

The Solicitors ’ Accounts Rules govern the treatment of client and practice monies by solicitors. They set out a number of general principles, including that a solicitor must keep client money separate from money belonging to the solicitor or the practice; keep client money safe in a bank or building society account identifiable as a client account; establish and maintain proper accounting systems, and proper internal controls over those systems, to ensure compliance with the rules; keep proper accounting records to show accurately the position with regard to the money held for each client and each controlled trust; and account for interest on other people ’ s money in accordance with the rules.

The Solicitors ’ Practice Rules are the principal set of rules governing the practice of solicitors in England and Wales.

5. Intervention and human rights

In Holder v. Law Society [2003] EWCA Civ 39 the Court of Appeal accepted that an intervention under the 1974 Act gave rise to an interference with a solicitor ’ s right to peaceful enjoyment of his possessions under Article 1 of Protocol No. 1 to the Convention. However, having regard to issues of proportionality and the margin of appreciation it concluded that the legislation itself and the approach taken by the Law Society struck the fair balance required by Article 1 of Protocol No. 1.

In particular, Carnwath LJ noted:

“31. In the present case, the ‘ margin ’ arises at two stages: first, the discretion allowed to the legislature in establishing the statutory regime, and, secondly, the discretion of the Law Society as the body entrusted with the decision in an individual case. (In the former case, the only remedy for exceeding the ‘ margin ’ may be a ‘ declaration of incompatibility ’ under the 1998 Act.) The intervention procedure, now contained in the Solicitors Act 1974, is long-established (dating back to 1941, in its earliest form), and has been reviewed by the court on many occasions. As appears from the cases to which I have referred, it has been recognised as ‘ draconian ’ in some respects, but necessary for the protection of the public interest; and the courts have repeatedly emphasised the ‘ balancing exercise ’ which it involves. I see no material difference between this and the ‘ fair balance ’ which article 1 requires ... I see no arguable grounds for thinking that the margin allowed to the legislature has been crossed, particularly having regard to the deference which is properly paid to an Act of Parliament, as compared to an administrative decision ...

32. Having reached that point, the Law Society ’ s actions must be judged by reference to the procedure laid down by Parliament, not to some hypothetical alternative procedure ...

33. The Law Society also has a ‘ margin of discretion ’ , but the court has a separate duty to consider the merits of the case, in accordance with the principles I have discussed, while paying due regard... to the views of the Law Society, as the relevant professional body. As I have said, this meets any ‘ fair balance ’ requirement ...”

Sir Christopher Staughton agreed that the appeal should be allowed, adding:

“38. In the exercise of its powers of intervention the Law Society must of course comply with the Human Rights Convention. I can imagine circumstances where the Law Society might be found not to have complied with the Convention, or with the Human Rights Act 1998. After all, a solicitor whose practice is the object of an intervention loses his practising certificate, and in all probability his livelihood as well. The provisions for bringing an intervention to an end are very unlikely to restore the solicitor ’ s goodwill and his prosperity. If it comes about that the intervention was mistaken or unjustified, there is a risk that the solicitor will suffer a substantial loss without recourse to any remedy. In practice this may never happen; but it is a cause for concern. However, not in this case.”

In Sheikh v. Law Society [2006] EWCA Civ 1577 Chadwick LJ, at the end of his leading judgment, made further obiter comments regarding the summary process for bringing a statutory challenge to an intervention and its compliance with claimants ’ Convention rights of in light of the decision in Holder :

“110... In Holder v Law Society [2003] EWCA Civ 39, [2003] 1 WLR 1059, this Court considered – and rejected – an argument that the procedure for which Parliament had made provision was incompatible with the solicitor ’ s Convention rights. It rejected that argument (inter alia) on the basis that the court ’ s power to consider whether a fair balance has been struck between the demands of the general interest of the community and the protection of the individual ’ s fundamental rights met the requirements of article 1 of the First Protocol. But it is clear that, unless the matter can be determined by the court within a short time of the intervention, the solicitor is likely to be denied an effective remedy. That is because the consequences of intervention – if the intervention continues for more than a short time – are likely to be irreversible. The solicitor ’ s clients will have to take their affairs elsewhere; the staff will have found other employment; and the practice will be destroyed in any event.

111. There is an obvious tension between the need to have an application to the court determined speedily and the need for the court to give full and fair consideration to the task which it has been set under the 1974 Act and, now, the Human Rights Act 1998. This case illustrates the need for the Society to give thought as to how that tension can be resolved...

112...The Society should, I think, give thought to the need for Panel resolutions to identify, with much more specificity than in this case, the reasons which (in the Panel ’ s view) make intervention necessary. If those reasons are not identified at an early stage, there is a danger that the solicitor will be denied the effective protection which Parliament plainly intended a summary process to provide.

113. There will, of course, be many cases in which the solicitor who has suffered intervention will be in no doubt as to the Society ’ s concerns. And, as I have said, there will be cases where the solicitor wishes to challenge the validity of the resolution on public law grounds. But, in cases where, although the solicitor knows what material was before the Panel, there is genuine doubt as to the matters which the Society regards as sufficiently serious to justify intervention, it seems to me that the court should be ready to assist – on an early application for directions following the issue of an application under the schedule 1 procedure – by requiring the Society to state the grounds upon which (on the material then known to it) the application will be resisted. Such a statement would enable the solicitor to address the Society ’ s concerns in a focussed response. And, in the light of that response, the Society can explain to the court why it takes the view (if it does) that the concerns have not been met.

114. I appreciate that the process suggested in the previous paragraph may require the court to adopt a more pro-active role on applications under schedule 1 to the 1974 Act than hitherto; and that the need for an early determination of such applications will place demands on the court ’ s resources which it may be difficult to meet. But, as it seems to me, the court will be ready to meet those demands in order to ensure that the solicitor does obtain the effective protection which the Convention requires and which the 1974 Act was plainly intended to provide.”

COMPLAINTS

In the applicant ’ s submission the failure to disclose the Forensic Investigation Report to him within the eight-day time-limit deprived him of effective access to a court, in violation of Article 6 § 1 of the Convention.

He further asserts that the intervention into his firm interfered with his right to property under Article 1 of Protocol No. 1 of the Convention and that such interference was procedurally unfair, unnecessary and disproportionate to any need to protect the public.

Finally, he argues that, contrary to Article 13, his lack of effective access to the statutory procedure for challenging the intervention deprived him of an effective remedy for his complaints under Article 1 of Protocol No. 1 of the Convention.

QUESTIONS TO THE PARTIES

1 . Was any interference with the applicant ’ s “peaceful enjoyment of possessions” such as resulted from the intervention by the Solicitors Regulation Authority in the applicant ’ s law firm justified within the meaning of Article 1 of Protocol No. 1? In particular, was any such interference proportionate?

2 . Having particular regard to the failure to disclose the Forensic Investigation Report to the applicant prior to the statutory deadline for challenging the notice of intervention under paragraph 6(4) of Schedule 1 of the Solicitors Act 1974, can it be said that the applicant had at his disposal an effective domestic remedy for his complaints under Article 1 of Protocol No. 1 of the Convention, as required by Article 13 of the Convention?

3 . Did the failure to disclose the Forensic Investigation Report to the applicant prior to the statutory deadline for challenging the notice of intervention deprive him of effective access to a court in breach of Article 6 § 1 of the Convention?