Conlon v Simms
| Jurisdiction | England & Wales |
| Judge | Lord Justice Jonathan Parker,Lord Justice Moore-Bick,Lord Justice Ward |
| Judgment Date | 20 December 2006 |
| Neutral Citation | [2006] EWCA Civ 1749 |
| Docket Number | Case No: A3/2006/0642 |
| Court | Court of Appeal (Civil Division) |
| Date | 20 December 2006 |
[2006] EWCA Civ 1749
Lord Justice Ward
Lord Justice Jonathan Parker and
Lord Justice Moore-Bick
Case No: A3/2006/0642
HC.04.C.0049 (TLC.113/05)
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT CHANCERY DIVISION
Mr Justice Lawrence Collins
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Simms, the Appellant acting in person
Mr Engelman (instructed by Bower Cotton Partnership) for the Respondent
INTRODUCTION
Mr Paul Simms, the defendant in the action and the appellant in this court, is a former senior partner of Bower Cotton, solicitors. Bower Cotton was dissolved on 30 April 2000, and thereafter Mr Simms and Mr Michael Conlon (another former partner in Bower Cotton) continued in partnership together on the terms of a partnership agreement dated 1 May 2000 under the name "The Bower Cotton Partnership". They were joined on 30 September 2000 by Mr Roger Harris.
On 2 February 2004, on the application of the Office of Supervision of Solicitors ("the OSS") , the Solicitors' Disciplinary Tribunal ("the SDT") pronounced Mr Simms guilty of conduct unbefitting a solicitor and ordered that he be struck off the roll of solicitors. By its findings, which were promulgated on 5 April 2004, the SDT expressed itself as satisfied beyond reasonable doubt that (among other things) from early 1997 onwards Mr Simms had been actively involved in making, promoting or facilitating transactions which (as he knew or, as an honest solicitor, would have known) were bogus in that they lacked an honest commercial purpose; and that in promoting such transactions Mr Simms had made deceitful representations to third parties – that is to say, that in relation to such transactions Mr Simms had acted dishonestly.
The hearing before the SDT lasted some fourteen days in November and December 2003. In the course of the hearing the SDT heard thirteen witnesses (including Mr Simms) . The findings themselves – which extend to some 161 pages of typescript (single spaced) – range over a large number of transactions, and it is immediately apparent from a perusal of the findings that they are the product of an extremely detailed and conscientious investigation by the SDT of each of the transactions in question.
Mr Simms appealed against the SDT's order to the Divisional Court on the ground (among others) that the SDT's findings were wrong. By its order dated 17 March 2005 the Divisional Court (Latham LJ, Curtis J and Newman J) dismissed his appeal. At the conclusion of its lengthy and detailed judgment, the Divisional Court said this (paragraph 188) :
"The most serious finding of the Tribunal was, of course, that the appellant was dishonest. We agree with the Tribunal that the pattern of behaviour by the appellant establishes that he was not merely foolish and credulous. He was prepared on occasion dishonestly to mislead in relation to the purpose of various transactions and indeed in failing to disclose his receipt of 50,000 in one instance. Accordingly we agree that his activities were, unfortunately, properly described as dishonest. That being the case, the order that the appellant be struck off the Roll is inevitable."
5. In the present action, which was commenced on 12 February 2004 (that is to say, after the SDT had announced its decision but before it had promulgated its findings) Mr Conlon and Mr Harris allege that Mr Simms induced them to enter into partnership with him, and to enter into a further agreement with him dated 1 May 2002, by fraudulent misrepresentations concerning two particular organisations with whom he had had dealings whilst senior partner of Bower Cotton, namely Elite Engineering Corporation Limited ("Elite") and The Charlton Corporation plc ("Charlton") ; and that in the negotiations leading, respectively, to the partnership agreement with Mr Conlon in May 2000, to the admission of Mr Harris into the partnership in September 2000, and to the agreement dated 1 May 2002 Mr Simms had fraudulently refrained from disclosing matters which might affect his status as a solicitor (and hence his ability to practise as such) , viz. the dishonest conduct of which the SDT had since found him guilty. The pleaded particulars of such matters (in paragraph 2.2(i) to (v) of the Amended Particulars of Claim) recite, in terms, the charges against Mr Simms which the SDT had found to be made out.
Paragraph 2.3 of the Amended Particulars of Claim pleads as follows:
"2.3 The First Claimant [Mr Conlon] will rely upon the findings of the [SDT] … and upon such further reasons as that Tribunal may produce hereafter."
In paragraph 3.2 of the Amended Particulars of Claim Mr Harris adopts paragraph 2.3, mutatis mutandis.
Paragraph 8A of the Amended Particulars of Claim pleads that the positive representations in relation to Elite and Charlton were untrue to Mr Simms' knowledge. The "Particulars of Falsity" pleaded under that paragraph recite the findings of the SDT in relation to those organisations, including its finding that both organisations were "instruments of fraud".
Paragraph 8B pleads that Mr Simms had a positive duty to disclose the matters listed in paragraph 2.2, and that by entering into the agreements in question he "necessarily represented that he was entitled to practise as a solicitor of the Supreme Court and there were no matters which would affect that status".
Paragraph 8C pleads that "… the representations both active and passive as pleaded" induced Mr Conlon to enter into partnership with Mr Simms and to enter into the further agreement dated 1 May 2002. Paragraph 8D pleads that by reason of "the passive representations pleaded at paragraph 2.2" Mr Harris was induced to enter into partnership with Mr Simms and to enter into the further agreement in May 2002.
Paragraph 8E pleads that by reason of Mr Simms' misrepresentations and non-disclosure Mr Conlon and Mr Harris have suffered loss and damage in entering into partnership with Mr Simms and in entering into the further agreement in May 2002. Paragraph 8F states that particulars of loss and damage would be supplied thereafter by way of an expert's report (none has as yet been served) .
12. Paragraph 8G pleads that, further or alternatively, Mr Simms is liable in respect of the alleged misrepresentations and non-disclosure in negligence and under the Misrepresentation Act 1967.
Paragraph 9 pleads, in the further alternative, that Mr Simms is liable in contract for breach of the obligation of good faith which is implicit in each of the agreements in question.
The pleading goes on to plead other discrete issues, to which I need not refer.
As originally drawn, the Particulars of Claim claimed rescission of the partnership agreements of May 2000 and September 2000, but by amendment the claim for rescission was deleted and in its place was substituted a claim for a declaration that those agreements and the further agreement in May 2002:
"… were entered into as a result of fraud or negligent misrepresentations by the Defendant as pleaded above which entitles the Claimants to damages for fraudulent, negligent or statutory misrepresentation".
No other relief is sought in relation to the allegations of misrepresentation and non-disclosure: in particular, there is no claim for damages based upon those allegations other than the reference to damages in the declaration itself.
By his Amended Defence and Counterclaim, Mr Simms denies all the allegations made against him by Mr Conlon and Mr Harris. In particular, he denies the facts alleged in subparagraphs (i) to (v) of paragraph 2.2 of the Amended Particulars of Claim (that is to say, the subparagraphs which recite the findings of the SDT relating to his conduct) . He alleges that Mr Conlon and Mr Harris were kept fully informed of all relevant matters, including the existence and progress of the proceedings before the SDT and his denials of the OSS allegations. He asserts that the outcome of the SDT hearing could not be predicted. In paragraph 8A(iii) he contends that the SDT findings are inadmissible in evidence in this action. In any event, he denies that Mr Conlon and Mr Simms have suffered loss and damage as alleged or at all. In response to the claim (since abandoned) for rescission of the partnership agreements of May 2000 and September 2000, Mr Simms alleged that Mr Conlon and Mr Harris had in any event affirmed those agreements by entering into the further agreement of May 2002. (Mr Simms' counterclaim relates to another aspect of the case, and is not material for present purposes.)
By their Amended Reply and Defence to Counterclaim Mr Conlon and Mr Harris accept that the outcome of the SDT hearing could not be predicted, but they allege (in paragraph 2.3) that:
"… the Defendant was aware that he had been involved in deceitful and fraudulent activity which rendered him unfit to practise as a solicitor".
They deny that Mr Simms is entitled to rely on a plea of affirmation. They contend that they relied on Mr Simms' false assurance that investigations being carried out by the OSS were untrue and without merit, and that the SDT findings are admissible in evidence as evidence of the facts found. Finally, they allege that Mr Simms reneged on assurances which he had given the Law Society and to his partners in April 1999 that thereafter Bower Cotton would not accept instructions in relation to investment schemes involving the use of its client account; and that he had falsely claimed...
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Subject Index
....235Comptroller of Customs v Western Electric Co.Ltd [1966]AC 367, PC . . . . . . . . . . . . . . . . . . 328Conlon and Harris v Simms [2006] EWCA Civ1749 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .56Copley v Madine, unreported, 4 June 1994, EAT. . . . . . . . . . . . ......
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Duties
...4 Tann v Herrington [2009] EWHC 445 (Ch), [2009] PNLR 22. 5 Thompson’s Trustee v Heaton [1974] 1 WLR 605. 6 Simms v Conlon and another [2006] EWCA Civ 1749, [2008] 1 WLR 484. 7 Winsor v Schroeder (1979) 129 NLJ 1266. Duties 61 situation’. 8 If the partner had not been convinced by the agent......
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Table of Cases
...K & J 491, 3 WR 384, 69 ER 552, VC Ct 138 Sichel v Mosenthal (1862) 30 Beav 371, 31 LJ Ch 386, 54 ER 932, Rolls Ct 138 Simms v Conlon [2006] EWCA Civ 1749, [2008] 1 WLR 484, [2007] 3 All ER 802 60 SISU Capital Fund v Tucker [2005] EWHC 2170 (Ch), [2006] BCC 463, [2006] BPIR 154, [2005] All ......