Sullivan: Clear conflict of interest
An £11m claim has fallen foul of a 242-year old rule that a solicitor with conduct of litigation may not take an assignment of their client’s cause of action, the High Court has held.
Master Sullivan said the fact the solicitors took the assignment through a company of which they were minority owners did not matter.
“The solicitor rule would be hollow if it could be so easily circumvented merely by the solicitors acting through a company,” she said. “That is no less a forceful argument even if they are minority shareholders.”
What the court called the solicitor rule dates back to the 1784 decision in Hall v Hallet.
The underlying claim arises out of an £11m, 20-year loan to John Rhoden by Maltby Services in April 2019. Mr Rhoden died in March 2023.
In November 2024, Maltby assigned its rights under the deed of loan to TD Capital, represented by Worcestershire law firm Hickman Construction Law.
Its directors, who own the law firm through companies, are solicitors Andew Hickman and Anthony Page.
There was correspondence about whether the debts were valid and binding on the estate, and TD Capital notified its intention to start part 8 proceedings.
In December 2025, TD Capital assigned the claim to MSV Estates, whose directors were Mr Hickman and Mr Page.
While there was some dispute over the level of their shareholdings, the evidence they put before the court indicated that they each held only about 11% of the company. MSV instructed a different law firm to act and commence the claim.
The defendants, the personal representatives of Mr Rhoden’s estate, sought summary judgment on the basis that the assignment was void.
MSV’s position was that the solicitor rule only applied once a claim was issued and that a vehicle in which the solicitors had a minority interest was not the same as the solicitors themselves.
Master Sullivan rejected this. “In my judgment, the fact that the assignment was to a corporate vehicle rather than Mr Hickman and Mr Page directly does not avoid the effect of the solicitor rule, just as the fact that they acted as solicitor through [Hickman Construction Law] rather than as an individual solicitor or solicitors does not affect it…
“There is a clear conflict of interest which the solicitor rule is in place to avoid. There is, in my judgment, no real prospect of arguing otherwise.
“As [counsel for the defendants] pointed out in his skeleton argument, the solicitor rule would be hollow if it could be so easily circumvented merely by the solicitors acting through a company. That is no less a forceful argument even if they are minority shareholders.”
MSV had also sought to add TD Capital as a party but the court did not have time to hear the application.
But for that, Master Sullivan said, there was “no other compelling reason why the issue should be disposed of at trial… I will list a hearing at which the consequences of this judgment and that application are determined”.
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