Adrian Alan Ltd v Fuglers (A Firm)
| Jurisdiction | England & Wales |
| Judge | Lord Justice Brooke,Lord Justice Kay,Lord Justice Dyson |
| Judgment Date | 13 November 2002 |
| Neutral Citation | [2002] EWCA Civ 1655 |
| Date | 13 November 2002 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | Case No: B2/2002/0592 |
[2002] EWCA Civ 1655
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM BRIGHTON COUNTY COURT
HH Judge Michael Kennedy QC
Royal Courts of Justice
Strand, London, WC2A 2LL
Lord Justice Brooke
Lord Justice Kay and
Lord Justice Dyson
Case No: B2/2002/0592
John Stevenson (instructed by Bosley & Co) for the Respondent
Paul Parker (instructed by Reynolds Porter Chamberlain) for the Appellants
This is an appeal by Fuglers, who are a firm of solicitors and the defendants in this action, and a cross-appeal by the claimants Adrian Alan Ltd ("AAL"), who are former clients of that firm, from the judgment of Judge Michael Kennedy QC at the Brighton County Court on 7th March 2002 following the trial of this action. In his judgment the judge held that AAL were entitled to repayment of £23,911.25, being fees they paid to Fuglers, in circumstances I will describe. He also held that they were entitled to recover £10,000 as damages for professional negligence in relation to the way Fuglers handled an appeal which AAL sought to bring from an adverse judgment of Arden J in an action in which Fuglers had been acting as their solicitors. On the other hand, the judge dismissed AAL's claim for the recovery of £3,000, being a sum they had paid by way of costs to the other side in connection with that appeal after it had been abandoned. Fuglers now appeal against the first and second of these decisions. AAL cross-appeals against the third, and also seeks to recover a larger sum as damages in respect of the second.
At the centre of the matters which give rise to this appeal are two men, Mr Michael Landon (a former employee of Fuglers who was to be imprisoned for dishonesty) and Mr Adrian Alan (an antique dealer in Brighton and the moving spirit behind AAL), and a court case concerned with a pair of 150-year old French candelabra. I will describe the two men first.
Mr Landon was struck off the roll of solicitors in 1979. In 1981 a firm called Barber Young was granted permission by the Law Society to employ him from year to year, and after two years this temporal condition was removed. In 1993 he moved to Fuglers where he remained until his sudden disappearance in February 1998. He was later to reappear at a police station in the company of a solicitor, and his prosecution, conviction and imprisonment for offences of dishonesty duly followed. Although he wrote a letter from prison to Mr Fugler, neither party called him at the trial and the judge placed no weight at all on the contents of this letter.
There was no evidence before the judge which related to the disciplinary offence or offences for which Mr Landon had been struck off the roll. The judge suggested, although he made no findings on the matter, that they may not have been offences of dishonesty in the light of the Law Society's later willingness to allow him to be employed by solicitors' firms. There was also no evidence about the terms, as to supervision or otherwise, on which the Law Society allowed him to be so employed, and the judge said he did not know the terms of the authority with which Fuglers allowed him to act for their clients or whether they permitted him to use their firm's notepaper.
In September 1993 Fuglers had three partners and three consultants. In April 1995 one of the partners left, and in February 1998 a second partner left, although he was immediately replaced. Between 1995 and 1998 the number of consultants was reduced from three to one. At the trial the judge did not hear oral evidence from any partner in the firm. Mr Fugler, who was the only partner throughout the period of Mr Landon's employment in the firm, signed a witness statement in connection with these proceedings but did not attend to give oral evidence. The judge was clearly unimpressed by the quality of the medical evidence adduced to him as to the reasons why Mr Fugler was not fit enough to attend court. Although he admitted his witness statement he did not give it much weight in so far as its contents differed from evidence given by other witnesses. He said he could not determine whether Mr Landon was employed by Fuglers as a generous act of support for a fallen professional colleague or because the firm was willing to take advantage of an apparently experienced former solicitor by employing him cheaply.
In the event, a Mr Vidler was the only representative of Fuglers to give oral evidence. The judge described him as "untrained save by experience". He came to Fuglers in 1991 after four years with another firm, and he professed some experience in drawing bills of costs. He performed a variety of duties for the firm. The judge concluded from Mr Vidler's evidence that Mr Landon was unsupervised and was given a pretty good run of the office. He was allowed to bill his services to clients as he chose, and he was happy to exploit Mr Vidler's willingness to help him.
Mr Alan, for his part, had his own solicitors in Brighton when he first met Mr Landon early in 1993 on a social occasion. Mr Landon was in Brighton in the company of a lady who knew Mr Alan and his wife, and he rapidly ingratiated himself. He told Mr Alan he was a solicitor and that he knew and acted for people whom Mr Alan knew. He said he was an experienced litigator in complex matters, and he suggested to Mr Alan that he would find it convenient to use a competent, experienced solicitor with offices close to his new business premises in London.
Mr Alan was persuaded to transfer some ongoing litigation to Mr Landon and to continue to use Mr Landon as his solicitor when he moved to Fuglers later in 1993. This firm did not send Mr Alan a client care letter, and Mr Alan continued to assume that he was instructing a qualified solicitor.
The judge found as a fact that Mr Landon habitually referred to himself as Mr Alan's solicitor in the presence of Mr Alan's staff and colleagues. He also showed Mr Alan a visiting card on which his name appeared under the firm's name, address and logo and the word "Solicitors". The judge found that Mr Landon continued to represent himself to Mr Alan as a solicitor. In these circumstances he held that Fuglers were responsible for the continuing effect of Mr Landon's original misrepresentation and for Mr Landon's breach of warranty of authority. The judge said that it was never an express term of Mr Alan's instructions that they should only be carried out by a solicitor, but that Mr Landon clearly represented himself as such in Mr Alan's presence to his friends and colleagues.
The first part of the appeal arises out of the judge's finding that AAL was entitled to recover sums totalling £20,350, together with VAT, which that company paid to Fuglers between 1994 and 1997 on solicitors' bills rendered in connection with four pieces of litigation. These included all steps taken in connection with the candelabra litigation up to and including the trial at first instance. Disbursements, including counsels' fees, were not included in the claim, which was a simple claim for the recovery of monies paid under a mistake of fact, namely that Mr Landon was a solicitor.
In holding that AAL was entitled to recover this sum, the judge relied on the reasoning contained in the judgment of Schiemann LJ, with whom Butler-Sloss LJ agreed, in Pilbrow v Pearless De Rougemont & Co [1999] 3 All ER 355. In that case the claimant had sought an appointment with a solicitor about a family matter, and the receptionist referred him to an employee of the firm who dealt with most of the firm's family business, She was, however, not a solicitor. As in the present case the firm failed to send the claimant a client care letter or to inform him of the true status of the person he consulted. Although the claimant's case, albeit lost, was conducted competently, this court upheld a circuit judge's refusal to allow the firm to recover its fees. The relevant parts of Schiemann LJ's judgment, at pp 359h-360a and 360f-361a, read as follows:
"The crucial initial question is whether the contract between Mr Pilbrow and the firm under which the firm was suing for its fees was a contract to provide legal services or a contract to provide legal services by a solicitor. The fact that he was under the impression that Miss Lee-Haswell was a solicitor and that she did not know this, is entirely attributable to the firm, the way its receptionist acted and the firm's failure to send an appropriate client care letter. The firm must take responsibility for this. In my judgment, in the circumstances of the present case the initial contract was one to provide legal services by a solicitor. The firm did not perform that contract at all. No legal services were provided by any solicitor. Not until all the legal services had been performed did Mr Pilbrow know that the provider was not a solicitor."
"Although the matter was not clearly argued thus in the courts below, as it seems to me, the present case presents once more the old problem of deciding whether what has happened is defective performance of a contract or non-performance of a contract. The courts have not evolved a conceptual tool which enables one to place every situation automatically in one category or the other. To a degree the point is one of impression. I am satisfied in the present case that the plaintiffs have failed to perform their contract and the defendant is entitled to regard it as discharged by the plaintiffs' breach. This case is not properly to be analysed as a case of defective performance of a contract for legal services with a term that...
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