Exercise of Statutory Powers - Holder v Law Society

Profession:Herbert Smith
 
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Article 1 of the First Protocol to the European

Convention on Human Rights (the Convention) establishes the right to the

peaceful enjoyment of ones possessions, subject to the public interest and

conditions provided for by law and international law. In Holder v Law

Society [2002] EWHC 1559 the Court considered whether the intervention

powers conferred upon the Law Society (the Society) under the Solicitors

Act 1974 were compliant with Article 1 of the First Protocol.

Background

Following an investigation by the Office of the Supervision of

Solicitors into the claimant solicitor's practice, the Society exercised

its statutory intervention powers to vest the claimant's practice monies

into its control and to require the claimant to deliver practice documents

to its agent. The intervention powers were exercised by the Society on the

basis that it had evidence that the claimant was in serious breach of the

Solicitors' Accounts Rules, had removed large sums of money from his

client account, and had made a potentially fraudulent misuse of the

Solicitors' Compensation Fund to repay personal debts to moneylenders. The

Court noted that the claimant had not disputed these allegations in any

credible way. The claimant subsequently appealed against an order granting

the Society summary judgment to dismiss the claimant's application to

withdraw the notice of intervention.

The claimant contended that the Society's statutory intervention powers

infringed Article 1 of the First Protocol of the Convention and sought a

declaration of incompatibility in respect of this power under section 4 of

the Human Rights Act 1998 i.e. a declaration by the Court that the

Society's intervention power as set out in the 1974 Act was incompatible

with the Convention.

The claimant submitted that under no circumstances could the statutory

power of intervention be justified. This was on the basis that the

exercise of the Society's intervention powers would always result in the

effective destruction of the practice of the solicitor concerned, the

destruction of any goodwill in the practice and any recoverability of work

in progress, and would effectively leave him without recourse. The

claimant argued that this was disproportionate and an infringement in

particular of his right to undisturbed possession of his property under

Article 1 of the First Protocol to the Convention.

Balancing the exercise of statutory powers in the public

interest with the rights of the individual

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