Hurst: SDT did not explain why it rejected his evidence
The High Court has overturned the finding of misconduct made about the solicitor for former Conservative Chancellor Nadeem Zahawi.
Mrs Justice Collins Rice held [1] that the decision of the Solicitors Disciplinary Tribunal (SDT) was “insufficiently analysed and reasoned, vitiated by misdirection and error of law, and unfair”.
The SDT had fined Ashley Hurst, a partner at Osborne Clarke, £50,000 after finding [2] he had shown a lack of integrity in sending an email to high-profile tax lawyer Dan Neidle that “improperly attempted” to restrict his right to publish it or publicly discuss its contents.
Mr Hurst was seeking to have Mr Neidle withdraw claims he had made about Mr Zahawi’s tax affairs.
In a detailed examination of the decision, Collins Rice J noted how the Solicitors Regulation Authority’s (SRA) original allegation was that the email had been improperly labelled ‘Confidential & Without Prejudice’ so as to prevent its permissible disclosure.
However, by the time it reached the SDT, the allegation was that the email “improperly attempted to restrict Mr Neidle’s right to publish the email”.
That was therefore what the SDT looked for, she went on, “and that is what it purported to find. Only then – and in what on the face of it reads as something of a logic puzzle – having found an improper attempt did it turn to the specifics of the allegations and find all the charges made out without further analysis”.
The decision appeared to approach the construction of the email “almost exclusively from this perspective”, she went on.
“On any basis, the primary purpose of this email was not to prevent Mr Neidle from publishing it. That is not a sensible proposition in its own terms.”
The “primary purpose” of the email was to stress that, while Mr Zahawi did not take issue with his tax affairs being publicly dissected and challenged, he “very much took issue with being publicly labelled a liar”.
But the tribunal ran with the notion that “Mr Hurst and his client were preoccupied with a clandestine operation designed improperly to interfere with Mr Neidle’s right to publish what the public had a right to know”.
Mr Hurst denied this “and no explanation is given for rejecting his evidence”.
Collins Rice J went on: “This idea of a preoccupation with secrecy and stifling a right to publish – proposed by the SRA and adopted by the tribunal – was, in my judgment, insufficiently examined, accounted for, or evidentially supported in the tribunal’s analysis, and as such was replete with risk of unfairness to Mr Hurst and to the reaching of an unfair decision.
“If the tribunal had taken the alleged regulatory breaches as its starting point instead, as it was fairly and properly required to do, and addressed itself to proper construction of the email as a whole, then it might well have found it convenient to begin by addressing the law on confidentiality and ‘without privilege’ and considering whether or not it was properly arguable for Mr Hurst to have advanced them in the email [‘properly arguable’ being the standard set in the SRA code of conduct].
“As it is, for the reasons I have set out, the tribunal did not address itself correctly and relevantly to that law, and unsurprisingly fell into error of law to the extent that it ostensibly had regard to it, sought to apply it, or rejected it as irrelevant.”
There was, the judge observed, “a recognisable factual and legal basis” in the email for an assertion that it was without prejudice and confidential correspondence and that Mr Neidle was not entitled to publish it.
As a result, the SDT “proceeded from a problematic starting point, via misdirection and error of law, to a conclusion adverse to Mr Hurst which was not properly open to it on the materials before it”.
Further, there was also “a failure of reasoning”, with the reasons “condensed to the point of compromised intelligibility”. The “unexplained delay” of five months in producing the reasons may have played a part in this.
The other “troubling feature” of the ruling was “the vehemence and disparagement with which it was expressed”.
Collins Rice J said: “A premise of Mr Neidle’s ‘right to publish’, and a faulty analysis of whether any different legal view was even arguable, led without visible support in the decision itself to a finding of intention to mislead, deliberately taking unfair advantage, calculated misuse of legal language and threats based on duties ‘that did not exist’.
“That in turn led to condemnation of Mr Hurst for having ‘fabricated’ legal obligations and having ‘ignored or dismissed his regulatory responsibilities’. These, and the finding of lack of professional integrity, are findings of bad faith, to put it no higher than that.
“As such, they import an elevated standard of proof and of reasoning, including an expectation of some clear articulation of why (if it did) the tribunal considered itself entitled to find Mr Hurst not to be a witness of truth.
“The charges Mr Hurst actually faced, and the analysis and reasoning set out in the tribunal’s decision, do not justify its expressing itself in the terms it did. It was not fair to Mr Hurst to do so.”
Mr Hurst said: “I’m relieved to have been exonerated by this comprehensive judgment. A big thanks to my excellent legal team, my colleagues and the many around the legal community who stood behind me during this long and stressful episode.”
An Osborne Clark spokeswoman added: “We are delighted with this result and appreciate the judge’s careful analysis in this important decision.”