Fairness of Disciplinary Proceedings - the Distinction Between Civil and Criminal for the ECHR


Article 6 of the European Convention on Human Rights ("the ECHR") sets out requirements for a fair hearing. Article 6(1) applies where civil rights or a criminal charge are being determined. Articles 6(2) and 6(3) apply specifically in criminal cases. Article 6(2) is the presumption of innocence until guilt is proven. Article 6(3) provides various rights including the right to free legal advice if the defendant cannot afford it. In R(on the application of Fleurose) v. Securities and Futures Authority Ltd [2001]. All ER (D) 361 (Dec) the Court of Appeal considered whether SFA disciplinary proceedings engaged Articles 6(2) and 6(3).

The appellant had been found guilty on two charges of misconduct by the SFA disciplinary tribunal. His registration was suspended for two years and he was ordered to pay 175,000 towards the costs of the SFA. The SFA's disciplinary appeals tribunal dismissed his appeal and the Administrative Court declined to grant his application for judicial review of that decision.

"Criminal" or "Civil"

The Court of Appeal approved of the test for whether offences are "criminal" or "civil" as affirmed recently in Han & Yau v. Customs and Excise Commissioners [2001] EWCA Civ 1048, namely that:

The first question is how the allegation is classified in domestic law. If the offence is not classified as criminal however this is not decisive and therefore the court must also have regard to;

the nature of the offence; and

the severity of the penalty.

Where the offence is restricted in its application to a specific group rather than to the public at large, which is generally the case in relation to disciplinary offences, the court will not usually classify the offence as criminal unless it involves or may lead to loss of liberty.

The court was not persuaded that the regulatory code of the SFA was more akin to a criminal code of general application than a code applying to a specific group. The fact that the appellant had a basic right to carry on his trade and that the only reason he submitted to the SFA's code was because that was the only way he could carry on his chosen trade was insufficient for the court to find that the SFA code did not apply just to a specific group. Accordingly even the prospect of unlimited fines was insufficient to convince the court that the SFA proceedings against the appellant involved a criminal charge or offence.

However, the court cited Official Receiver v. Stern [2001] 1 WLR 2230 (following the...

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