The level of honesty and integrity demanded by the Solicitors Regulation Authority (SRA) is incredibly high. And the penalty for acting dishonestly or with a lack of integrity can end an otherwise promising legal career.
In Bolton v The Law Society, the then Master of the Rolls, Sir Thomas Bingham, stated:
“It is required of lawyers practising in this country that they should discharge their professional duties with integrity, probity and complete trustworthiness- That requirement applies as much to barristers as it does to solicitors. If I make no further reference to barristers it is because this appeal concerns a solicitor, and where a client’s moneys have been misappropriated the complaint is inevitably made against a solicitor, since solicitors receive and handle clients’ moneys and barristers do not”.
The finding of dishonesty is likely to lead to a solicitor being struck off the Roll.
Therefore, if such as charge is brought against you by the SRA, it is imperative you seek expert legal advice.
Some examples of dishonesty can be seen in two recent appeals – Wingate & Anr v Solicitors Regulation Authority and Solicitors Regulation Authority v Malins  EWCA Civ 366.
In the first appeal, two solicitors, Mr Wingate and Mr Evans, appealed against the High Court’s reversal of their acquittals by the Solicitors Disciplinary Tribunal. In the second appeal, the Solicitors Regulation Authority appealed against the High Court’s reversal of findings of misconduct against another solicitor, Mr Malins.
The facts relating to the appeals
Mr Wingate and Mr Evans were the partners in a small law firm. Mr Wingate concentrated on day-to-day management issue while his partner focused on litigation work. The partnership was facing financial difficulties. A litigation funder agreed to lend it £900,000. Mr Wingate signed a funding agreement which did not reflect the parties’ true arrangement. The firm failed to repay the loan, and the litigation funder’s investors suffered a loss. The SRA alleged that, in accepting the monies, the partners had failed to act with integrity, contrary to the SRA’s Code of Conduct Principle 2, and had been manifestly incompetent, thus failing to behave in a way that maintained the public’s trust, contrary to Principle 6. It also alleged that Mr Wingate had acted dishonestly. The SDT acquitted the solicitors. The SRA appealed but abandoned the dishonesty allegation. The judge found that Mr Evans had not lacked integrity, but otherwise reversed the acquittals.
In the second appeal, Mr Malins had arranged ATE insurance regarding planned litigation. To recover the ATE premium under any subsequent costs order, notice of the premium had to be served on the defendant before 1st April 2013. The litigation was settled in 2014 and Mr Malins claimed the premium as part of his costs. He found the notice had not been sent in time; therefore, he created a backdated notice and covering letter. The SRA charged him with breaches of Principles 2 and 6 in creating and deploying the documents, and additionally alleged dishonesty regarding the deployment. The SDT found the allegations proved, but on appeal, the judge held the decision to have alleged dishonesty in the deployment, but not in the documents’ creation, was illogical and confusing.
The Court of Appeal’s decision
The court held that the test for dishonesty was objective, but the defendant’s state of mind and as well as their conduct were relevant to determining whether they acted dishonestly.
Lord Justice Rupert Jackson provided this comment regarding the test of dishonesty:
“Let me stand back from the kaleidoscope of the authorities and consider what the law now is. Honesty is a basic moral quality which is expected of all members of society. It involves being truthful about important matters and respecting the property rights of others. Telling lies about things that matter or committing fraud or stealing are generally regarded as dishonest conduct. These observations are self-evident and they fit with the authorities cited above. The legal concept of dishonesty is grounded upon the shared values of our multi-cultural society. Because dishonesty is grounded upon basic shared values, there is no undue difficulty in identifying what is or is not dishonest”.
Lord Justice Jackson then went on to discuss integrity. He stated integrity was a more “nebulous” term than honesty, therefore less easy to define:
“In professional codes of conduct, the term “integrity” is a useful shorthand to express the higher standards which society expects from professional persons and which the professions expect from their own members. The underlying rationale is that the professions have a privileged and trusted role in society. In return they are required to live up to their own professional standards”.
He went on to state that a solicitor who acted with manifest incompetence could undermine the public’s confidence in the legal profession and a solicitor acting carelessly, but with integrity, would breach Principle 6 if the conduct went beyond professional negligence.
After discussing the tests for honesty and integrity, the Court of Appeal went on to hold that, in relation to Mr Wingate and Mr Evans, just because no dishonesty had been found, did not mean the funding agreement was not a sham.
“It was extraordinary that a solicitors’ firm should be asked to sign a sham contract for no satisfactory reason. For Mr Wingate honestly, but foolishly, to go along with that arrangement was manifest incompetence”.
In the case of Mr Malins, the Court of Appeal held the judge had been in error when he held a lack of integrity meant the same as dishonesty. Integrity carried a wider meaning. In addition, The SRA case was not illogical. Once the Respondent had created the documents, it was not inevitable that he would deploy them. The SRA had been entitled to limit its dishonesty allegations to the deployment of the documents only.
As we predicted in a post last summer, the Court of Appeal did hold the initial decision in Malin’s was wrongly decided.
Charges of dishonesty or lack of integrity by the SRA should be treated with the utmost seriousness. A conviction by the SDT can be catastrophic to an otherwise promising career. The pressure on solicitors, in the form of increasing client expectations and large billing targets can lead to out-of-character decisions being made in the heat of the moment. It is, therefore, crucial to instruct an experienced solicitor to create a solid defence on your behalf.
We have been helping legal professionals with professional disciplinary and regulatory hearings for over 20 years. If you have any questions relating to SRA investigations or SDT decisions, please call us on 0151 909 2380 or complete our Free Online Enquiry and I will soon be in touch.