Baxter v Doble & Anor (2023) EWHC 486 (KB)
This was an application for committal for contempt of court for provision of legal services by a person not entitled to do so, arising out of a possession claim in Devon. It is of considerable significance in view of the many non-solicitor ‘Evictions R Us’ firm that ‘assist’ private landlords with possession claims.
Sarah Doble, and her firm Sarah Doble Associates Ltd, had been engaged by a Mr Persey in relation to possession proceedings against Mr Baxter, his tenant. Ms Doble was a CILEX member as a paralegal, but not regulated. In the course of proceedings, solicitors for Mr Baxter raised the issue of Ms Doble apparently conducting litigation. That eventually resulted in these proceedings (though the possession claim was successful).
Under the Legal Services Act 2007, it is an offence to carry out a reserved activity without being an authorised person. ‘Conduct of litigation’ is specified as a reserved activity. At paragraph 4, Schedule 2 to the 2007 Act ‘conduct of litigation’ is defined as
“Conduct of litigation
4 (1)The “conduct of litigation” means—
(a) the issuing of proceedings before any court in England and Wales,
(b) the commencement, prosecution and defence of such proceedings, and
(c) the performance of any ancillary functions in relation to such proceedings (such as entering appearances to actions).
There were no disputes on the facts of what Ms Doble/her firm had done. The only issue was whether some or all of those actions amounted to conducting litigation.
The High Court considered the various cases on this issue, which were not particularly helpful on the borderline between conduct/non conduct,
It is also very difficult to identify a clear dividing line between what does and does not amount to the conduct of litigation from a review of the authorities. There are a number of reasons for this. There are three Court of Appeal authorities which are binding upon me, but the first, Agassi, was dealing with different legislative language (with respect to him, I do not agree with Mostyn J’s observation in JK v MK that the definition of the conduct of litigation in the 1990 Act was “nearly identical” to the definition in the 2007 Act); the second, Ellis, was dealing with the clearest possible case of the conduct of litigation; and the third, Ndole, was concerned with a single issue, which was whether the service of proceedings amounts to the conduct of litigation. None is factually similar to the present case. The observations of the judge in the Heron case were obiter and the judge in that case was only required to consider whether there was an arguable case that there had been the conduct of litigation. The facts of Peter Schmidt, about a winding up petition, and JK v MK, about a consensual divorce, were very different from those in the present case. The Khan case was also concerned with a very clear case of the conduct of litigation. The only case which bears a similarity to the present case is Gill v Kassam, but there are also significant differences: in particular, in that case the advisers used the online claims process, which Mrs Doble carefully avoids using.
However, there were four key general principles in approaching such matters:
The first is that the starting-point must be the statutory language itself, and the statutory words must be given their natural and ordinary meaning.
The second is that it must be borne in mind that this is penal legislation, which may result in a conviction for an offence with a maximum sentence of two years (or for committal for contempt with the same maximum penalty: Contempt of Court Act 1981, section 14(1)). In Agassi, at paragraph 56, the Court of Appeal said that, because there are potential penal implications, the very obscurity of the statutory language means that the words should be construed narrowly. However, that was said at a time when the defence that the person accused did not know, and could not reasonably have known, that they were engaged in reserved legal activities did not apply. That defence was introduced by section 14(2) of the 2007 Act. This matters, in my view, because the grounds for a very strict and narrow construction are now less compelling. It is no longer a strict liability offence. Nonetheless, as the Court of Appeal made clear in Ndole, it must still be borne in mind, when interpreting the legislation, that this is penal in nature.
The third key point comes from the Court of Appeal’s judgment in Ndole. This is that substance must prevail over form (judgment, paragraph 67).
The final point is that the question is one of fact and degree in every case (paragraph 68). The Court of Appeal said that an approach permitting individual assessment of the activity undertaken in an individual case is likely to achieve justice.
Applied to the facts of this case, firstly with regard to pleadings, the Defendants had carried out the following:
Particulars of Claim and claim form
Drafted them (though they were checked, amended, and approved by the client);
Prepared the enclosures (though these were checked and approved by the client);
Checked the bundle of documents to be sent to the court, to ensure that the right number of copies were sent;
posted the claim form, particulars of claim, enclosures, and covering letter to the court;
Paid the court fee of £355 by cheque from the Second Respondent’s account, having been put in funds in advance by Mr Persey; and
Ensured that the documents were drafted and filed in a way that complied with the CPR.
Reply and Defence to Counterclaim
Drafted it (though it was checked and approved by the client);
Sent it for review by the advocate;
Made arrangements for the pleading to be delivered to the Claimant’s solicitor by hand, using process servers;
Took the decision that service should be by hand rather than by post; and
Ensured that the deadline imposed by the court by an order dated 27 August 2019 was met.
These amounted to conducting litigation. On
the claim form and particulars of claim, in my judgment the reasoning of the Court of Appeal in Ndole applies all the more clearly to the delivery of documents to the court as it does to the delivery of documents to the other party. If sending a pleading to the other side by way of service is the conduct of litigation, then sending a claim form or pleading to the court for issue in order to commence the proceedings must also amount to the conduct of litigation. Once again, the fact that the documents were not signed by the Respondents does not matter, nor that they did not go on the record as Mr Persey’s representatives. Nor did the fact that they did not submit a covering letter on the Second Respondent’s letterhead. The surrounding circumstances of the filing of the claim form and the particulars of claim make clear that this was not merely clerical or mechanical activity: the Respondents advised upon the claim form and particulars of claim, drafted them, ensured that they complied with the CPR, and paid the court fee. Once again, even if the test in Agassi still applied, this would be the conduct of litigation: it was a formal step in the proceedings.
As the Court of Appeal made clear in Ndole, the fact that the Respondents were acting as agents of Mr Persey when filing and serving documents did not mean that they were not themselves conducting litigation.
The Court of Appeal in Ndole considered the entirety of the actions undertaken by the consultants in that case when deciding that the service of documents was the conduct of litigation. Applying the same approach to the current case, I am satisfied, to the criminal standard, that the filing of the claim form and particulars of claim, and the arrangements made for service of the reply and defence by the Respondents, amounted to the conduct of litigation.
In addition to the actions in relation to the pleadings, the Defendants also carried out the following:
the Respondents carried out the following activities on behalf of Mr Persey: they gave legal advice; they drafted notices under section 8 and section 21 of the Housing Act 1988; they corresponded with the Claimant’s solicitor; they drafted the claim form and particulars of claim; they paid the issue fees; an employee of the Second Respondent signed a certificate of service of the notice of issue; they gave instructions to an advocate for several hearings in the matter; they drafted witness statements; they drafted an application notice and draft order for the strike-out application; they drafted the reply and defence to counterclaim; and they drafted the case management summary for the CMC.
Of these, the following were not part of conducting litigation in themselves.
Giving legal advice
Drafting and serving notices under s.8 and s.21 Housing Act 1988
Service of notice of issue (because not a required step in litigation)
But, taken in the round (as they should be), the activities of the Defendant amounted to conducting litigation
In my judgment, the answer is yes. The Respondents did everything for Mr Persey in relation to the proceedings that a solicitor or other authorised person would have done. They gave full-service assistance to Mr Persey, including drafting all of the documents required to comply with formal requirements, giving instructions to counsel, making a payment to court, corresponding with the other side, and ensuring that all procedural steps complied with the CPR. Someone must have conducted this litigation, and it would be wholly artificial to say that Mr Persey did it himself, albeit with support and guidance from the Respondents. This would be to under-state their involvement. They conducted the litigation for him. Put another way, they were “prosecuting” the proceedings for him. The Respondents’ role went far beyond clerical or mechanical assistance. As the Court of Appeal said in Ndole, it is a question of fact and degree whether an advisor or consultant crossed onto the wrong side of the line. On the facts of this case, and again applying the criminal standard, I conclude that the Respondents did cross the line and that their involvement in the proceedings, taken as a whole, amounted to the conduct of litigation.
The only difference in this case from that which a solicitor or other authorised person would have done is that the Respondents did not formally go on the record or use their own notepaper for covering letters when dealing with the court (though they did use their own letterhead when corresponding with the Claimant’s solicitor). In my judgment, it would be wrong, and wholly contrary to the statutory purpose as expressed in section 1 of the 2007 Act, for these matters to take activities outside the meaning and scope of the conduct of litigation. This would be to prioritise form over substance. It would mean that the question whether someone was conducting litigation would depend on an arid technicality. Indeed, to treat this as the only thing that matters would be to provide an incentive for those who were not authorised persons to conceal their involvement from the court, which cannot be right.
After discussing the Practice Guidance on McKenzie Friends – Practice Guidance (McKenzie Friends) (2010) 1 WLR 1881 – the court adds:
The Practice Guidance, at paragraph (19) reminds us of the policy reasons behind the restrictions on conduct of litigation in the 2007 Act. It is significant, in my view, that the Practice Guidance says that McKenzie Friends, not being authorised or exempt persons, must not “manage litigants’ cases outside court”. That is exactly what the Respondents were doing.
Even if I am wrong in my conclusion that the Respondents’ actions should be looked at in the round and, as such, amount to the prosecution of proceedings and so to the conduct of litigation, I consider that some of the actions taken by the Respondents, looked at in isolation, consisted of the conduct of litigation, in addition to the filing of the claim form and particulars of claim, accompanied by the payment of the court fee, and the service of the reply and defence to counterclaim. Specifically, I think that the giving of instructions to an advocate; drafting of witness statements; the drafting of the application notice and draft order for the strike-out application; the drafting of the reply and defence to counterclaim; and the drafting of the case management summary for the CMC each formed part of the prosecution of the claim. The drafting of the claim form and the particulars of claim was done, ex hypothesi, before the proceedings were commenced, and so did not amount to the conduct of proceedings in themselves, but they are relevant in that they enhance the impression that the total package of services provided by the Respondents, taken as a whole, amounted to the conduct of litigation.
Despite this, the Court declined to make a finding of contempt. The law had been sufficiently unclear as to what amounted to conducting litigation at the relevant time that the statutory defence under section 14(2) Legal Services Act 2007 applied – Ms Doble could not be reasonably expected to know she was conducting litigation.
Comment
For many ‘Evictions R Us’ set ups, this full service assistance is their selling point (see for example here and here ), and that particularly includes drafting pleadings and instructing an ‘advocate’ (not a practising barrister) via LPC or similar. (Indeed, Ms Doble’s firm had a general referral agreement with LPC). But these are now to be clearly understood as conducting litigation.
Further, serving documents (even if not on the company letterhead), filing documents in compliance with court orders (again, even if not on company letterhead), making payments to court, and correspondence with the other side are all likely to be conducting litigation if forming part of an overall conduct.
In fact, apart from giving advice and service of a section 21 or section 8 notice, it is hard to see what more such a ‘paralegal law firm’ could do in relation to proceedings without running a grave risk of conducting proceedings and committing an offence.
The law may have been previously unclear, but now it is far less so. ‘We didn’t know what we were doing’ is unlikely to fly as a defence in the future.
Any solicitors whose other side appears to be one of these setups should a) refuse to have anything to do with them if they are corresponding ‘on behalf of their client’, and b) consider a contempt application. There may also be grounds to challenge pleadings, of course.