Petition Of Her Majesty's Secretary Of State For Business Enterprise And Regulatory Reform For An Order To Wind Up Uk Bankruptcy Limited
| Jurisdiction | Scotland |
| Judge | Lord Clarke,Lord Justice Clerk,Lord Marnoch |
| Neutral Citation | [2010] CSIH 80 |
| Date | 21 September 2010 |
| Docket Number | P1975/08 |
| Court | Court of Session |
| Published date | 21 September 2010 |
| SECOND DIVISION, INNER HOUSE, COURT OF SESSION | |
| Lord Justice Clerk Lord Clarke Lord Marnoch | [2010] CSIH 80 P1975/08 OPINION OF THE LORD JUSTICE CLERK IN THE PETITION OF HER MAJESTY'S SECRETARY OF STATE FOR BUSINESS ENTERPRISE AND REGULATORY REFORM Petitioner; For an order to wind up UK Bankruptcy Limited _______ |
For the petitioner: Olsen; Brodies
For the respondent: No appearance
For the Lord Advocate: Miss Ross;
The Advocate General for Scotland: Lord Davidson of Glen Clova QC, in person
Amicus curiae: Clark QC; D G Hamilton:
21 September 2010
Introduction
[1] This is a petition for the winding-up of UK Bankruptcy Ltd (the company) under section 124A of the Insolvency Act 1986 on the ground that the winding-up is expedient in the public interest. On 9 December 2008 a provisional liquidator was appointed. On 22 December 2008 Paul Mason, one of the two directors and shareholders, lodged answers to the petition. They bear to be signed by him for and on behalf of the company.
[2] Mr Mason has produced no evidence that the Board of the company has authorised him to lodge these answers, or has even resolved to defend the petition. Therefore, in my view, we should proceed on the basis that the lodging of answers by Mr Mason has not been authorised by the company. According to the petitioner, Mr Mason is opposing the petition in order to forestall disqualification proceedings against him under the Company Directors Disqualification Act 1986. Mr Mason has not contradicted that assertion.
The Lord Ordinary's report and subsequent procedure
[3] On 19 February 2009, at a hearing on further procedure, Mr Mason sought to represent the company in the process. On 16 March 2009 there was a hearing before Lord Hodge on the question whether he was entitled to do so. Mr Mason submitted (1) that under article 6 of the European Convention on Human Rights a company has the right to be represented in court by one of its directors, and (2) that the rule that a company may be represented before this court only by counsel or by a solicitor having extended rights of audience is no longer good law.
[4] The Lord Ordinary considered that in consequence of the rule in Equity and Law Life Ass Soc v Tritonia Ltd (1943 SC (HL) 88), Mr Mason had no right to represent the company; and that, as a general rule, there was no incompatibility between article 6 and the requirement that a company must be represented by a suitably qualified legal representative, who had responsibilities to the court and was subject to professional discipline. He thought that, nonetheless, exceptional circumstances could arise in which the court would have to allow a company to be represented by a person who was not a qualified practitioner in order to ensure that there was a fair hearing under article 6. The Rules of Court did not provide for that, but the court could allow it by the exercise of its inherent power. There was a need for careful consideration of the circumstances in which that might be done.
[5] The Lord Ordinary has therefore reported the case to the Inner House on this question. He has considered some possible procedural safeguards. He suggests that the director or other representative should have to show that the company has authorised him to act on its behalf; and that, to avoid any conflict of interest, the company should expressly authorise the submissions that its representative is to make. He also suggests that the company should have to satisfy the court that it does not have the means to obtain legal representation and that its proposed representative is in a position to present the company's case; and that the court should consider the nature of any proposed submission to ascertain whether it raises a bona fide and relevant issue of fact or law.
[6] The Lord Advocate and the Advocate General compeared. It became apparent to us that both favoured the view that in appropriate circumstances the present rule should be relaxed. In the circumstances, we thought it expedient to appoint senior and junior counsel to act jointly as amicus curiae. They have favoured the same view.
The current rule in Scotland
The Act 1532 c 51
[7] The rule restricting rights of audience in this court dates from the foundation of the court. In the legislation of 1532 which established the College of Justice, the Act 1532 c 51 provided inter alia
"That na man enter to pley, bot parties conteined in their summoundes and their procuratoures, gif they will ony have.'
The procurators referred to were the advocates, whose office was instituted, and is still regulated, by chapters 64, 65 and 66 of that year.
The writers
[8] Maclaren's succinct expression of the rule is that "A member of the Faculty of Advocates is the only person allowed to plead before the Court of Session, with the exception of a party to the cause" (Court of Session Practice, p 14). Maxwell explains the underlying rationale as follows.
"Only a member of the Faculty of Advocates and a party to the cause are entitled to plead in court before the Court of Session. Such a rule, limiting a right of audience on behalf of others to members of the Bar, secures that the Court will be served by advocates who observe the rules of their profession, who are subject to a disciplinary code, and who are familiar with the methods and scope of advocacy which are followed in presenting arguments to the Court" (The Practice of the Court of Session, p 24).
Case law
[9] In Gordon v Nakeski-Cumming (1924 SC 939) the Inner House considered whether in light of the Married Women's Property Act 1920, which abolished a husband's right of administration over his wife's property, a husband could competently appear before it on his wife's behalf. The rule was restated in that case by Lord President Clyde as follows.
The right of audience before this Court is ... equally shared by the parties litigant before it, and by duly admitted advocates who appear on their behalf; but it belongs to no one else. Pleadings in cases called before this Court are accordingly presented to it either per party or per procuratorship of counsel, and in no other way" (at p 941).
[10] The rule was enforced by the Second Division in 1984 when it refused to permit an unqualified person to represent his elderly father. The court observed that the decision in Gordon v Nakeski-Cumming (supra) had been acted on consistently (Rush v Fife Regional Council, 1984 SLT 391).
[11] The only possible departure from that rule of which I am aware is in Kenneil v Kenneil ([2006] CSOH 95). That case related to disputes arising from an action of division and sale. The Lord Ordinary allowed a secured creditor, who appeared in her own right in relation to certain issues, to represent her husband, who was the second defender and was otherwise unrepresented. In his consideration of that procedure, the Lord Ordinary referred to the English practice by which a litigant in person may be assisted by a McKenzie friend (cf McKenzie v McKenzie [1971] P 33) and noted that in some cases such assistance had been permitted in Scotland (para [15]). He observed that in English practice the court was willing to allow a McKenzie friend not only to assist the litigant in person but, in certain circumstances, to address the court (para [16]). It is my impression that in agreeing to the proposal the Lord Ordinary regarded the second defender's wife as acting as if she were a McKenzie friend, on the view that she would say only what she and her husband had decided to say. He regarded it as a material consideration that the second defender's wife had in part drafted his averments. However, in that case the second defender was abroad at the time and in the event the decision of the Lord Ordinary was that he should be "represented" by his wife at the hearing (para [18]).
[12] In Anderson, Petr (2008 SCLR 59), in similar circumstances, the Lord Ordinary refused a proposal that the case for the elderly and infirm petitioner should be presented by her son, on the view that it was not competent in the Scottish courts for a person assisting a party litigant to address the court on the party litigant's behalf (para [24]).
The extension of rights of audience
[13] The Court of Session Act 1988 confers on any solicitor a right of audience before the vacation judge (s 48(2)(a)) and in such other circumstances as may be prescribed (s 48(2)(b)). The Rules of Court allow solicitors without extended rights of audience to appear in limited circumstances in the hearing of certain motions (RC 23).
The Law Reform (Miscellaneous Provisions) (Scotland) Act 1990
[14] This Act made it possible for solicitors to be given extended rights of audience in the higher courts, civil and criminal (s 24; cf Court of Session Act 1988, s 48(1); s 48A).
[15] The Act also provided a method by which a professional or other body might enable one of its members who was a natural person to acquire rights to conduct litigation on behalf of members of the public and rights of audience in certain courts and in certain categories of proceedings (s 25). This provision has not been brought into force.
Criminal Procedure (Scotland) Act 1995
[16] This consolidating Act continues provisions that give to all solicitors limited rights of audience in relation to certain applications, and in preliminary and interlocutory proceedings, before a single judge of the High Court (s 103(8)).
Conclusion
[17] I mention these provisions by way of demonstrating that every extension of rights of audience beyond the restrictive categories of the traditional rule has been effected by way of express statutory provision. Subject to these specific extensions, the general rule that I have described has remained in force (cf Asmat Mushtaq v SSHD [2006] CSOH 19).
Artificial persons
[18] A separate line of authority relates to the representation of artificial persons. In Equity and Law Life Ass Soc v...
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