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	England and Wales High Court (Chancery Division) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Chancery Division) Decisions >> Zurich Professional Ltd v Brown & Anor [2010] EWHC 3300 (Ch) (16 December 2010) URL: http://www.bailii.org/ew/cases/EWHC/Ch/2010/3300.html Cite as: [2011] WTLR 531, [2010] EWHC 3300 (Ch)

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IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION

		Royal Courts of Justice Strand, London, WC2A 2LL
		16 December 2010

Sir William Blackburne :

Introduction

1. The question in this litigation is whether a particular professional indemnity policy ("the Policy") covers any and if so which actionable defaults committed by a solicitor in the course of administering the estates of Robert Grimshaw Whitehead and his wife Phyllis Margaret Whitehead.
2. The claimant (Zurich) which has appeared by Mr Graeme McPherson QC is the insurer under the Policy. It contends that the Policy does not extend to the defaults, and seeks declaratory relief accordingly. Alternatively, it seeks declarations as to which of the defaults are so covered. The first defendant, Mr Brown, is the solicitor whose conduct is in issue. He was the personal representative of the estate of Mrs Whitehead who died on 27 October 1999. Her last will, dated 19 May 1999, was proved by a grant dated 11 May 2000. The grant to Mr Brown was for the use and benefit of David Nicholas Whitehead (commonly known, and referred to in this judgment, as Dan) who had been appointed executor under her will. Dan was the Whiteheads' son and sole beneficiary (ignoring certain pecuniary legacies) under Mrs Whitehead's will. Mr Brown was also the executor named in the last will, dated 3 July 1999, of Mr Whitehead who died on 17 September 2000. That will with a codicil was proved by Mr Brown on 7 June 2001. Under Mr Whitehead's will and codicil Dan and his half-sister Jennifer Larrad were the sole beneficiaries.
3. On 10 April 2006, Master Moncaster made an order under section 50 of the Administration of Justice Act 1985 terminating Mr Brown's appointment as personal representative of Mrs Whitehead's estate and appointing Rachel Barnes of Messrs Beale and Company Solicitors LLP in Mr Brown's place. On 26 June a similar order, this time in respect of Mr Whitehead's estate, was made appointing Ms Barnes in place of Mr Brown. Mr Brown took no part in those proceedings but did, belatedly, comply with an order to transfer, inter alia, all relevant files and documents (concerned with the two estates) to Ms Barnes. Ms Barnes is the second defendant and has appeared by Mr David Halpern QC.
4. On 19 October 2007 Ms Barnes, acting in her capacity as personal representative of the two Whitehead estates, issued proceedings ("the Administration Proceedings") against Mr Brown alleging that in his administration of the estates he had acted in breach of his duties as a personal representative. He did not defend the proceedings. On 25 June 2008 Ms Barnes obtained judgment in default for accounts to be taken on the footing of wilful default in respect of both estates and for other relief. Those accounts have yet to be taken. It is far from clear what losses have been caused by Mr Brown's defaults. It seems reasonably safe to assume that they run into many thousands of pounds. Instead, the parties to these proceedings wish to know whether any and if so which of the defaults, as alleged in the Administration Proceedings, are covered by the Policy.
5. Zurich's claims are opposed by Ms Barnes, on behalf of the two estates, who seeks declarations that Zurich is liable to indemnify Mr Brown in respect of his defaults as established by the Administration Proceedings and that, as the current personal representative in respect of the two estates, she is subrogated to Mr Brown's right of indemnity under the Policy. As between Zurich and Ms Barnes these proceedings turn on the operation of the Third Party (Rights Against Insurers) Act 1930. Although no proceedings under that Act can properly be brought by Ms Barnes against Zurich until the monetary extent of Mr Brown's liability in the Administration Proceedings has been determined, the parties have proceeded as if it had been. This is to enable the real question - whether Zurich has any liability under the Policy for Mr Brown's defaults - to be determined without incurring what may turn out to be unnecessary further costs. For, if and to the extent that liability under the Policy is established, Zurich may wish, as the entity which will pick up the bill, to contest the quantification of the damages which flow from the defaults in question. If by contrast there is no liability, Ms Barnes is unlikely to wish to incur further costs in establishing the estates' losses against an impecunious Mr Brown. This is because Mr Brown was declared a bankrupt on 21 January 2008. The probabilities are that he will be unable to pay any amount ordered against him on the taking of the accounts. The only realistic prospect of recovery is from Zurich under the Policy but that depends on showing that the defaults are covered by it. There is obvious sense in proceeding in this manner.
6. This procedural short cut should not be allowed to mask the position in law. What triggers the operation of the 1930 Act, in particular the transfer of rights by section 1(1), is Mr Brown's insolvency, which post-dated the incurring by him of his liabilities to the beneficiaries of the two estates. But for his bankruptcy, Mr Brown would have had to bring proceedings against Zurich to enforce the Policy. This is recognised by the 1930 Act which provides by section 1(4) that upon a transfer of rights under section 1(1) "…the insurer shall…be under the same liability to the third party as he would have been to the insured…" In effect (as Mr Halpern readily accepted) Ms Barnes stands in Mr Brown's shoes in seeking to establish that his contract with Zurich - the Policy - covers his defaults. It is as if, having met the estates' claims against him, Mr Brown sues to enforce the Policy with a view to recovering what he has had to pay out. I make this obvious point to avoid falling into the trap of allowing my sympathy for Dan's and Jennifer's understandable sense of grievance occasioned by Mr Brown's failings and the loss to them thereby caused to influence my view of the meaning of the Policy and its application to the facts as I find them to have been.

Mr Brown

7. Because he has chosen not to participate in these proceedings the parties have had to piece together as best they can the course of Mr Brown's career. For this they have relied upon Dan's acquaintance with Mr Brown over many years, information supplied by the Law Society and information which Mr Brown supplied about himself when applying for professional indemnity cover in and after 2002. The following picture emerges.
8. Mr Brown was admitted as a solicitor on 15 June 1971. He obtained a practising certificate and, that same year, became an associate (and in 1974 a partner) in Clifford-Turner (which, on a subsequent merger, was to become Clifford Chance). He specialised in tax planning and associated matters. At Clifford-Turner he became a close colleague of Robert Whitehead who became senior partner of the firm and so remained until his retirement in 1984. In his witness statement Dan described Mr Brown as "a particular protégé of my father" and as someone whom his father held in high esteem and to whom he largely owed his position in the firm.
9. When Mr Whitehead left Clifford-Turner Mr Brown also left, resigning his partnership in April 1984.
10. According to a curriculum vitae dated 4 April 2002, prepared in connection with an application by Mr Brown for professional indemnity cover for a practice he was about to conduct in the name of "CS Law" (I come later to CS Law and to the circumstances in which he applied to Zurich for that cover), Mr Brown stated that between May 1984 and 28 February 2002 he:

"...continued to practise as a legal, business and tax consultant (in London and, between 1991 and 1995 in Monaco) providing advisory services to clients... During this time I have also been a non-executive director of an oil exploration and production company, a restaurant, a transport company and an oil service group..."

11. By way of support for what was said in the curriculum vitae, there is evidence to suggest that in the late 1980s Mr Brown was working from 67 Jermyn Street London SW1 in that, in wills drawn up for Dan and his wife Caroline (Dan's is dated 23 November 1989 but the copy in evidence of Caroline's lacks the second page although it is likely to have been executed at or about the same time), Mr Brown who is appointed an executor under both wills is described in the appointment clause as "my solicitor" and as being "of 67 Jermyn Street." Dan seemed to recall that Mr Brown practised from that address in the 1980s and that at one time he was "employed" (which might equally have meant that his services were "retained") by a well-known jeweller and that at some stage he worked for a transport company. For a while, Mr Brown and also it would seem a Ms Anne Stevens were directors of and had shareholdings in a company, Tulsegraph Ltd, through which Dan owned and ran a London restaurant. The business had previously been owned and run through a company called Kenchel Restaurant Ltd. Kenchel got into financial difficulties and, with Mr Brown's assistance, the business was rescued and thereafter operated through Tulsegraph. Dan said that it was his father who had instructed Mr Brown to assist and that, either as a reward or as an incentive to do the work, Mr Brown (and it would seem Ms Stevens) became shareholders and were appointed directors. It was not clear quite when this happened. I infer from the material generally that this was sometime in the late 1980s or possibly at the beginning of the 1990s.
12. According to the curriculum vitae Mr Brown was based in Monaco between 1991 and 1995. That period seems to have ended disastrously for him. In a letter to Zurich dated 19 June 2002 (the letter was written in connection with his application for professional indemnity cover) Mr Brown wrote to say that:

"...On 4 July 1995 I was declared bankrupt on my own Petition as a result of suffering loss through the fraudulent activity of a business partner in Monaco. Whilst not practising as a solicitor during most of that period I was subject to section 12 of Solicitors Act and received a Practising Certificate subject to the condition that I only practised as an employee. After my discharge (in July 1998) I applied for and received an unconditional Practising Certificate."

In fact the date when Mr Brown next had the benefit of an unconditional practising certificate was 31 October 2000.

13. Also at around this time, it is not clear just when, Mr Brown went through an acrimonious divorce. He had by then formed a new relationship. That was with Ms Stevens. Whether it was in connection with the divorce or for other reasons, he and Ms Stevens resigned from Tulsegraph's board in April 1995 and transferred their shareholdings to Dan.
14. Information going back to 20 December 1993 supplied by the Solicitors Regulation Authority indicates that Mr Brown had practising certificates from 30 December 1993 to 24 April 1997 after which, as the above letter from Mr Brown to Zurich confirms, a condition was imposed on his certificate to the effect that Mr Brown could act as a solicitor "only in employment which is approved by the Office for the Supervision of Solicitors ...". It would appear that no OSS approval of any employment as a solicitor was given (and I infer, but I may be wrong, that none was sought) so that Mr Brown was effectively without a practising certificate between April 1997 and 31 October 2000. Thereafter he had a practising certificate continuously until 11 December 2007 with the exception of a 22 day period between 4 and 26 January 2005.
15. This brings me to CS Law. According to his curriculum vitae, from 1 March 2002 "to date" (i.e. 4 April 2002 which is when that document had been signed), Mr Brown had been:

"Practising as CS Law with primary emphasis on debt collection work introduced by a debt collection agency on behalf of their clients (the creditors). In the main, activity will be restricted to issuing claims, entering judgement and judgment enforcement with most defended actions being referred to other solicitors' firms."

It appears from other documents to which I will come later that cover for his practice as CS Law was provided with effect from 4 July 2002. CS Law-headed notepaper gave a PO Box address and telephone and fax numbers in Walsall, in the Midlands. The notepaper stated that Mr Brown was the principal.

16. The CS Law practice continued until 2007 or thereabouts when Mr Brown's career as a solicitor suffered further, and in the event, fatal reverses. These appear to have resulted from or been connected with his involvement in a business venture in the Midlands which failed. Then, in 2007 he was the subject of disciplinary proceedings before the Solicitors Disciplinary Tribunal. They resulted in his being struck off the Roll of Solicitors on 14 December 2007. This was followed by his second bankruptcy on 21 January 2008.

The Policy

17. As I have mentioned, from 4 July 2002 or so CS Law had the benefit of professional indemnity insurance cover provided by Zurich. The period of cover relevant to Ms Barnes' claims was from 1 October 2004 to 30 September 2005. The Policy is on a "claims made" basis: the claim for indemnity must be made during the period of cover even though it may relate to a liability which arises prior to the inception of cover. It was common ground that the claims on the Policy were made in a lengthy letter which Dan wrote to Mr Brown on 25 October 2004. That was within the year of cover beginning at the start of that month.
18. So far as material, the terms of the Policy were as follows.
19. By clause 1, Zurich, which is identified in the Policy as the "Insurer":

"...to the extent and in the manner hereinafter provided hereby agrees:

1.1 Civil Liability

To indemnify the Insured against any Civil Liability to the extent that it arises from Private Legal Practice in connection with the Firm's practice, a Prior Practice or a Successor Practice provided that a Claim in respect of such liability

(a) is first made against the Insured during the period of insurance; or

(b) is made against an Insured during or after the Period of Insurance and arising from Circumstances as notified to the Insurer during the Period of Insurance."

20. The expression "the Insured" is defined by clause 7.12 to mean:

"...each and all of the following persons or legal entities each being severally insured hereunder:

(a) the Firm

(b) each Principal ..."

21. The expression "the Firm" is defined by clause 7.10 to include "the partnership...or the sole practitioner...specified in the Schedule." The Schedule identifies "The Firm" as "CS Law" and its address as 3 High Street, Cheslyn Hay, Walsall. "Partnership" is defined by clause 7.15 to mean "an unincorporated Firm and the expression "Principal" is defined by clause 7.17(d) to mean, in the case of a sole practitioner, "...that Practitioner". As Mr Brown, when practising as CS Law which was unincorporated, was its sole principal and carried on practice as a sole practitioner during the relevant "Period of Insurance" (ie from 1 October 2004 to 30 September 2005) he was an "Insured" under the Policy.
22. Cover under clause 1.1 is limited to any civil liability (made against the Insured during the Period of Insurance) "to the extent that it arises from Private Legal Practice in connection with the Firm's Practice..." The expression "Private Legal Practice" is defined by clause 7.19 to mean (with emphasis added):

"...the provision of services in private practice as a solicitor or registered European lawyer including, without limitation:

...

(c) the acceptance and performance of obligation as executor, trustee, attorney, insolvency practitioner or other personal appointment to the extent that any fees or other income accrue for the benefit of the Firm's practice..."

Private Legal Practice does not include practising as an Employee of an employer other than a solicitor, a registered European lawyer, a Partnership permitted by rule 7(6) of the Solicitors' Practice Rules 1990, or a Recognised Body"

Zurich does not rely on the words that I have emphasised. It does not do so not least because of their inconsistency with what are referred to in the Policy as "the Minimum Terms". These are defined by clause 7.14 to mean "the Minimum Terms and Conditions of insurance referred to in the Solicitors' Indemnity Insurance Rules in force from time to time with which this Policy is required to comply". In this connection, clause 5.9 provides that:

"The Policy of Insurance is to be construed or rectified so as to comply with the requirements of the Minimum Terms and any provision that is inconsistent with those Minimum Terms is to be severed or rectified such that it complies with them."

The Minimum Terms in question (i.e. those to be found in Appendix 1 to the Solicitors' Indemnity Insurance Rules 2004 ("the 2004 Rules")) contain a definition of "Private Legal Practice" which omits any limitation of the kind apparent from the emphasised words. Mr McPherson made clear that Zurich did not in any event seek to rely on them.

23. The expression "the Firm's Practice" appearing in clause 1.1 is defined by clause 7.11 to mean:

"...the Private Legal Practice carried on by the Firm, any Prior Practice and/or any Successor Practice."

The Policy contains definitions of "Prior Practice" and "Successor Practice" as do the Minimum Terms. Put shortly, they assume that the Successor Practice has resulted from "...a merger, acquisition, absorption or other transition following which the Firm succeeded to is no longer being carried on as a discrete business ..." (See clause 7.21 defining the meaning of "Successor Practice". See also, mirroring that definition, the definition of "Prior Practice" contained in clause 7.18.) These definition are ones to which I shall have occasion to return later in this judgment.

The questions to be answered

24. It is common ground, and the supporting documentation is voluminous in this regard, that following his appointment as personal representative Mr Brown personally undertook a very considerable amount of work in administering the two estates. This continued until February 2002 when further work seems largely, although not wholly, to have ceased. It is also common ground that in their declining years leading up to their deaths Mr Brown had been active in assisting the Whiteheads to manage their financial affairs. He did so, it would appear, pursuant to Enduring Powers of Attorney which each had granted to him and Dan in January 1999. In January 2000 he applied to register the Power that Mr Whitehead had granted.
25. The questions which I have to determine are whether when acting in the administration of the two estates, alternatively when acting in their administration in the respects which have resulted in the judgment given against him in the Administration Proceedings, Mr Brown was providing services as a solicitor in private legal practice and, if he was, whether he was doing so in connection with the legal practice carried on by CS Law (for which he had professional indemnity cover from Zurich). There are therefore two material requirements to be fulfilled. I call them "the qualifying conditions". The onus is on Mr Brown as the insured (and therefore Ms Barnes standing in his shoes) to show that they are satisfied. See McGillivray on Insurance Law, 11^th Edition at paragraph 19-006.

In what capacity did Mr Brown act in the Administration of the estates?

26. Mr Halpern submitted that in acting in the administration of the two estates Mr Brown acted as a solicitor and did so in private legal practice. He submitted that he is to be taken to have acted as a solicitor for essentially four reasons: (1) the work which he carried out in the administration of those two estates was work which is not merely of a kind that solicitors in private practice carry out but is expressly within the definition of "Private Legal Practice" contained in clause 7.19 of the Policy (in particular as set out in sub-clause (c)) and, for good measure, within the equivalent definition set out in the Minimum Terms; (2) although he did not in terms say to either Dan or Jennifer that it was as a solicitor that he was acting in the administration of the two estates, he did not at any stage say in so many words that that was not the capacity in which he was acting; (3) Dan and Jennifer (and, for good measure, Caroline, Dan's wife) understood and believed at all material times that that was the capacity in which he acted and (4) from time to time in the course of so acting (or in the course of steps taken in anticipation of so acting), he corresponded with third parties to say that he was carrying out some action as a solicitor or made reference to himself as a solicitor.
27. In support of these matters (I will come shortly to the purely factual matters on which Ms Barnes relies), Mr Halpern referred to the definition of "private practice" contained in rule 3.1 of the 2004 Rules (the words and expressions in which are stated to be applicable in the construction of the Minimum Terms except where the context of the latter otherwise requires: see clause 8.1(h) of the Minimum Terms) as including:

"…without limitation all the professional services provided by a firm including acting as a personal representative, trustee, attorney, notary, licensed insolvency practitioner or in any other role in conjunction with a practice, and includes services provided pro bono publico, but does not include:-

…

(iii) practice consisting only of:-

(a) providing professional services without remuneration for friends, relatives…"

There was, he said, no question of Mr Brown acting in the administration of the two estates for no remuneration. He charged and was paid £38,000 in September 2001 for acting in the administration of Mr Whitehead's estate. And there is other evidence (to which I will come) relating to payment for his services.

28. Mr Halpern pointed out that the 2004 Rules envisage that a solicitor may practise as a solicitor even though that person does not have in force a practising certificate or is without professional indemnity insurance. (See the definition of "solicitor" in rule 3.1 and the provisions of Part IV of the 2004 Rules.) The fact that a solicitor who so acts is in breach of those rules (or other regulatory requirements governing solicitors in private practice), as was the case with Mr Brown for some at any rate of the time that he acted in the administration of the two estates, and is or may on that account be subject to sanction of one kind or another does not, submitted Mr Halpern, detract from the fact that a solicitor who is without a practising certificate and without indemnity cover may nevertheless be acting in private practice.
29. Mr Halpern referred also to the Solicitors' Separate Business Code 1994 ("the 1994 Business Code"). Paragraphs 1 and 2 of schedule 1 to that code explain that:

"(1) This code aims to ensure that members of the public know whether a service is provided by a solicitor practising as such (and thus regulated by the Law Society and affording clients certain statutory protections) or outside the scope of a solicitor's practice (and thus outside the regulation of the Law Society, and not affording any of the statutory protections extended to the clients of a solicitor).

(2) This code prohibits a practising solicitor from providing certain legal services other than as a solicitor and requires that certain safeguards be observed where there is a connection between a solicitor's practice and his or her separate business. However, neither the Practice Rules nor this code regulate solicitors' separate businesses, and such separate businesses are not underwritten by the Solicitors' Compensation Fund or covered by indemnity insurance under the Law Society's compulsory scheme."

30. Section 3 of the 1994 Business Code states that subject to certain exceptions set out in sections 4, 5, 6 and 7:

"…a solicitor must not have a separate business which provides any of the following services:

…

(d) acting as executor, trustee or nominee in England and Wales;

(e) drafting any will or trust deed;

(f) giving legal advice…"

"Separate Business" is defined by section 2(a) to mean a business which "…provides any service which may properly be provided by a solicitor's practice…" One of the exceptions referred to in section 3 - it is to be found in section 4 - states that:

"A solicitor who has a separate business must ensure:

(d) that all clients referred by any English or Welsh practice of the solicitor to the separate business are informed in writing of the solicitor's interest in the business and that, as customers of the separate business, they do not enjoy the statutory protections attaching to clients of a solicitor …"

31. Mr Halpern also referred me to the Guide to the Professional Conduct of Solicitors 1999 issued by the Law Society ("the 1999 Professional Conduct Guide"). Under the heading "What work can a solicitor do without a practising certificate?" the Guide states, inter alia, that:

"…A solicitor who gives legal advice (eg to friends or relatives) must make it clear to the person concerned that he or she is not a practising solicitor and cannot give advice or do any work on their behalf as such. In addition, the solicitor must make it clear that he or she is not insured against professional indemnity risks."

32. Mr Halpern referred to these provisions as part of what he described as the factual matrix against which the Policy and Mr Brown's conduct fall to be considered. He did so in support of his submission that the recipients of legal advice and assistance from a person who is a solicitor are entitled to assume that such advice and assistance, even if supplied for free, are given by that person as a solicitor, and with the backing of insurance, unless the contrary is made clear. He submitted that this was plainly relevant in determining whether Mr Brown was acting as a solicitor. In short, he submitted, a solicitor who acts as a personal representative may do so as a solicitor; equally, he may do so otherwise than as a solicitor. But the presumption is that he acts as a solicitor unless he makes it clear that he is not so acting. He cannot rely on his own breach (i.e. an unexpressed intention to act otherwise than as s solicitor) to maintain that he was not so acting. If he is found to have acted as a solicitor, then his insurer for the year when the claim is made cannot avoid liability by alleging that he was not so acting. Or, as it was put by Mr Halpern in the course of his closing submissions, a person who is a solicitor who provides a service which a firm of solicitors typically provides is necessarily in private legal practice unless he comes within one of the exceptions listed in the 1994 Business Code and can only deny that he is in private legal practice by stating clearly and in writing to the recipient of the service that he does not provide that service as a solicitor. I call this "Mr Halpern's key submission".
33. What then are the other matters on which Ms Barnes relies for saying that the first of the two qualifying conditions was fulfilled? I first list those which relate to Dan's understanding of Mr Brown's capacity. I then turn to other matters relied upon.
34. First, Dan knew that, as a solicitor, Mr Brown had been a partner at Clifford-Turner. He had instructed him as his solicitor to draw up his will in 1989 which Mr Brown duly did. In the will Mr Brown is appointed his executor and is described as "my solicitor" (likewise in Caroline's will). Similarly, at his father's invitation, Mr Brown had assisted Dan to reconstruct the restaurant business following the financial collapse of the company though which it had initially been held.
35. Second, although aware of Mr Brown's personal and financial problems in the 1990s (his acrimonious divorce and his bankruptcy), his father had continued to trust Mr Brown sufficiently to allow him to take on more and more of the administration of his personal affairs. Dan had likewise continued to trust and have confidence in Mr Brown and had no reason to think that Mr Brown was not still in practice as a solicitor even though he was no longer a partner in Clifford-Turner. Certainly, he understood Mr Brown to be practising as a solicitor in the 1980s from an address in Jermyn Street in Central London.
36. Third, although when administering the two estates Mr Brown did not in terms say to Dan or Jennifer (or for that matter to Caroline) that he was acting as a solicitor, any more than he did when he assisted in the administration of Mr and Mrs Whitehead's affairs prior to their deaths pursuant to the Enduring Powers of Attorney which each had given, he did not say that he was not so acting. Consistent with that is that, in a letter dated 18 January 1999 to the Whiteheads' solicitors (Messrs. Cripps Harries Hall) in connection with the execution by the Whiteheads of new powers of attorney in his and Dan's favour, he described himself as "a former partner of Mr Whitehead and a longstanding friend of the Whitehead family". A copy of the letter was sent to Dan who had no reason to think that in writing it Mr Brown was not acting as a solicitor. The letter sought the solicitors' help so that Mr Brown "might establish a thorough understanding of Mr and Mrs Whitehead's affairs." Dan could be forgiven for thinking that Mr Brown was taking over what Cripps Harries Hall had previously been doing for the Whiteheads. He did so for an annual fee of £5000 which was later increased to £10,000.
37. Fourth, the matters which Mr Brown undertook when acting, initially when managing their financial affairs and subsequently, following their deaths, when administering their estates are ones typically carried out by a solicitor acting as such. One step which he took, namely the preparation of papers with a view to obtaining probate of Mrs Whitehead's will, was a matter which by section 23(1) of the Solicitors Act 1974 only a qualified solicitor may lawfully undertake. The significance of this is not lessened by the fact that the actual grant was extracted by a firm of solicitors (called Corsellis) whom Mr Brown had instructed for the purpose. Moreover, in a draft Inheritance Tax Inland Revenue Account, drawn up in relation to Mrs Whitehead's estate and sent by Mr Brown to Dan in January 2000 (at a time when it was intended that Dan should apply for probate in his own name) Mr Brown was described as "Solicitor(s) or Agent(s)". Although, as just mentioned, Mr Brown used the services of Corsellis to undertake the formal steps necessary to obtain probate of Mrs Whitehead's will, he did not draw Dan's attention to this: Dan was under the impression that Mr Brown was taking all the steps himself.
38. Fifth, in some of his many letters to Dan, Mr Brown set out detailed advice of a legal nature. For example, in a letter to Dan dated 18 May 2000, Mr Brown explained the effect of a grant in his (Mr Brown's) favour and what was involved in administering Mrs Whitehead's estate. In so advising Mr Brown acted as a solicitor would act and Dan had no reason to think that that was not the capacity in which Mr Brown gave that advice.
39. Sixth, although he had run a restaurant business, acting through a limited company, Dan was unsophisticated in business and legal matters. His serious medical condition in 2000 which had resulted in major heart surgery affected his memory. Indeed, as a note which he made in connection with his application to register the Enduring Power of Attorney granted by Mr Whitehead, Mr Brown regarded Dan as detached from reality, careless in matters of accounting and subject to Caroline's influence. This was relevant to the extent to which Dan was entitled to rely on and place his faith in Mr Brown believing him to be his solicitor.
40. Seventh, when following his mother's death he was in hospital receiving treatment for a serious heart condition Dan was approached by Mr Brown with the suggestion that he administer Mrs Whitehead's estate on Dan's behalf (Dan having been named as executor in his mothers will). Dan took up that suggestion and appointed Mr Brown his general attorney for the purpose of obtaining the necessary grant. Dan assumed and believed that Mr Brown had approached him as a solicitor and that he was appointing someone who was a solicitor and could be trusted as such.
41. Eighth, when Mr Brown wrote to Dan in December 1999 to say that he was working on the probate of Mrs Whitehead's estate and that to avoid any misunderstanding his "fees for the probate and administration would be on a normal fee basis" Dan understood the expression "on a normal fee basis" to mean that he would act as a solicitor. Mr Brown did not say anything to suggest that he was not acting in that capacity. Nor did he say anything, either then or later, to indicate that he was without a practising certificate or professional indemnity insurance. To like effect was a note sent by Mr Brown to Dan in September 2001 setting out his charges for acting in Mrs Whitehead's estate. The note stated that "...my fees for probate and administration work will be on a normal fee basis..." The reference was to his (not anyone else's) fees and was typical of what a solicitor might write to a client about his charging rates. Moreover, Dan understood "on a normal fee basis" to mean that Mr Brown was acting as a solicitor. Similarly, when he wrote to Dan in November 2001 following Mr Whitehead's death, he referred to "my" (i.e. Mr Brown's) fees for administering his estate.
42. Ninth, in January 2000, Mr Brown sent Dan a copy of a letter which he had written to the Adult Assessment Team at Oxford County Council (in connection with care services which were being provided to Mr Whitehead senior). In that letter Mr Brown referred to himself as "Mr Whitehead's lawyer".
43. Tenth, in a letter to Dan dated 13 June 2000, written at a time when Mr Brown was upset over action taken by Dan and his wife to involve other agents in the sale of the Whiteheads' former home, Mr Brown referred to Dan as his "client" and stated how he was "protecting" Dan's interests. This, said Mr Halpern, was typical of the language used by a solicitor when describing his relationship with his client.
44. Eleventh, when writing to Dan in October 2001 in connection with a dispute which Dan had with his landlord, Mr Brown stated that he was "not prepared to act for you in this matter", thereby implying that he was acting for Dan in other matters.
45. Turning from matters relied upon as the basis for Dan's understanding of the capacity in which Mr Brown acted to Mr Brown's dealings with others, Mr Halpern placed particular emphasis on a number of letters which Mr Brown wrote to third parties in which he referred to himself as a solicitor. For example, in a letter written in April 2001 to Lloyds TSB in connection with a possible loan to cover a payment of inheritance tax on Mr Whitehead's estate, Mr Brown referred to himself as "a solicitor". By then he was once again in receipt of a practising certificate and referred to that fact in his letter to the bank. This showed, said Mr Halpern, that he was plainly acting as a solicitor. There were other letters from Mr Brown in which he referred to himself as a solicitor. Thus, in a letter dated 15 May 2001 to National Westminster Bank seeking a loan to cover the same inheritance tax payment (Lloyds TSB having declined to lend the amount needed) he again offered (and later gave) an undertaking "as a solicitor" to deal promptly with the obtaining of probate of Mr Whitehead's will and to discharge the loan out of the first available assets of the estate. He followed this up some days later by sending the bank a copy of his practising certificate, stating that "I only practise as a solicitor when that is essential – e.g. administering estates…" The following month he applied for probate of Mr Whitehead's will in his own name. On this occasion he did not use (and, as he was applying as the named executor, did not need to use) the services of Corsellis or any other solicitors. Instead, he sent a copy of his practising certificate to the Probate Registry. To similar effect are references to himself as a solicitor in other letters he wrote. Thus, in June 2001, he wrote to the Royal Mail asking them to redirect Mr Whitehead's mail. He stated that he was "a Solicitor and …the Executor" of Mr Whitehead's estate. That same month he wrote to Hill Samuel in Jersey in connection with certain of Mr Whitehead's offshore investments. He stated in his letter that he was an English solicitor and held a practising certificate. The following month he wrote to company registrars in Australia (in connection with other assets of Mr Whitehead's estate) enclosing a copy of the grant of probate of Mr Whitehead's will and saying that the copy had "been certified by me as a Solicitor of the Supreme Court…"
46. Mr Halpern submitted that Brown's role as executor of each estate was single and indivisible. It was not credible to suppose that Mr Brown acted in the administration of the estate as a solicitor on some occasions (as on those just described) and not on others. The whole of his conduct must be looked at in the round.
47. Persuasively as it was put I do not accept Mr Halpern's analysis of Mr Brown's conduct. I find that no liability on the part of Mr Brown to Ms Barnes, established by the Administration Proceedings, arose from the provision of services by him as a solicitor in private legal practice so that the first of the two qualifying conditions was not fulfilled. My reasons for that conclusion are as follows. I start with Mr Halpern's reliance on the regulatory framework governing the conduct of solicitors and on the relevance of the perception which Dan and Jennifer had of the capacity in which Mr Brown acted when engaged in the administration of the two estates. I then look at the evidence.
48. Mr McPherson submitted that the fact that Mr Brown may have been in breach of provisions of the 2004 Rules, the 1994 Business Code or the 1999 Professional Conduct Guide is of marginal relevance. The meaning and effect of the Policy, he said, do not turn on the application of those provisions and there is no warrant for giving the Policy a construction it would not otherwise bear in order to enable Mr Brown to avoid being in breach of a professional obligation set out in those provisions. He submitted that these provisions may have some relevance to the determination of the capacity in which Mr Brown acted but only in the limited sense that it is ordinarily to be presumed that a solicitor does not consciously act in breach of his professional obligations. But, he said, this scarcely helps Mr Brown who, on any view, fell foul of various regulatory requirements, not least, if Mr Halpern is correct, such basic matters as the need to hold a practising certificate and to be insured while carrying on in practice.
49. Nor did he accept what I have termed Mr Halpern's key submission. That submission, he said, goes too far. At the most the expectation that a solicitor is acting as a solicitor in private practice when he provides services which a solicitor ordinarily provides is a matter to be taken into account in a consideration of the overall position. Likewise is this so when he provides a service which only a solicitor can lawfully provide and then only if he holds a practising certificate (for example, acting for a fee in drawing or preparing papers on which to found a grant of probate: see section 23(1) of the Solicitors Act 1974). In themselves, he submitted, they cannot be conclusive. The position is the same, he said, in the case of the findings of the Solicitors Disciplinary Tribunal to the effect that on the occasions considered by the Tribunal Mr Brown practised, or held himself out to practise, as a solicitor without holding a current practising certificate. Mr McPherson pointed out that the Tribunal was aware of the complaint against Mr Brown which resulted in the Administration Proceedings (the claim form in which was issued shortly before the Tribunal issued its findings) and expressed "some concern" at the fact that Mr Brown "appeared" to have acted while uncertified. But it did not investigate the matter and, accordingly, made no findings material to it.
50. He went on to submit that care had to be exercised when considering what Dan or Caroline or Jennifer may have assumed or believed or understood to be the capacity in which Mr Brown acted while carrying on the administration of the two estates. The court's task, he said, was to establish objectively by reference to the documentary and other evidence the capacity in which Mr Brown acted. The evidential value of what Dan or Caroline of Jennifer understood to be the capacity in which Mr Brown acted at any time must depend upon the basis upon which they had that understanding.
51. In my judgment Mr McPherson is correct in these submissions. Dan's (or Jennifer's) understanding of the capacity in which Mr Brown acted cannot of itself be determinative: the value of that understanding must depend on what it was that gave rise to it and whether in all the circumstances the understanding was well founded. The regulatory matters on which Mr Halpern relied are at most factors which the court is entitled to bear in mind when approaching this task. None is conclusive. For the reasons given by Mr McPherson, Mr Halpern's key submission goes too far. The court's task is to establish objectively by reference to all of the admissible documentary and other evidence, taking due account of the regulatory background, the capacity in which Mr Brown acted.
52. What then does that evidence show?
53. A striking feature of the very many letters Mr Brown wrote to Dan, both in the months prior to the Whiteheads' deaths when Mr Brown became involved in helping to administer their affairs, and also in the period after their deaths when he obtained probate of their wills and thereafter acted in the administration of their estates, is that all of them were on headed notepaper bearing Mr Brown's name and address at 28 Old Brompton Road, London SW7. (I was given to understand that this was a business convenience address, used largely if not wholly for the receipt of correspondence.) The notepaper carried at the bottom of the first page a printed box ("the printed footer") within which the following appeared:

"Malcolm Brown is a consultant with the Wychwood Consultancy Company Ltd registered in England, Company No 3210748, VAT registration No. 674036239 registered office: 1 St Peter's Road, Braintree, Essex CM7 6AN Directors: A N Stevens and J N Mayer"

(Ms Mayer ceased to appear as a director in about mid-2000, after which Ms Stevens alone was shown as a director.)

54. On the face of it, therefore, the printed footer proclaimed to the recipient of the letter bearing it that Mr Brown was writing as a consultant with Wychwood. Moreover, there was nothing explicit on the face of any of the very many letters which carried the footer to indicate that he was working in some other capacity, in particular that of a solicitor. Still less was there any of the other information which ought to appear on the headed notepaper of a solicitor who writes in that capacity, namely that the letter is from solicitors (with details of the partners or principal or where a list of the partners can be seen) and that the practice is regulated by the Law Society.
55. Dan's evidence was that he did not pay much attention to the printed footer and would not have questioned it if he had done so. Of the appearance of Mr Brown's name at the top of the headed notepaper he said that "I simply thought that was referring to him as a solicitor". But that was mere assumption on his part. In not one of the letters to him, even ignoring the printed footer, did Mr Brown say that he was acting as a solicitor.
56. Jennifer's evidence, in relation to the few letters that she received (all of them bear the printed footer), was to the same effect. She said that she assumed that Mr Brown was acting as a solicitor, notwithstanding the printed footer, because when she had met him sometime in 1998, she knew he was a solicitor, understood that he had once worked in Mr Whitehead's firm, had later acted as Mr Whitehead's lawyer and was named in a joint power of attorney. She appears to have assumed from this that, in the absence of any statement to the contrary in his letters to her, he was acting as a solicitor. Doubtless this belief was encouraged by the fact that in one or two of the letters (for example his letter to her of 19 September 2000, which was shortly after Mr Whitehead's death) Mr Brown set out, in a manner that a solicitor acting as such would do, what her entitlement was under Mr Whitehead's will and that he was the executor named in the will and what this entailed.
57. Caroline received no letters from Mr Brown and only met him on two occasions, one of which was in 1988 in connection with her will. So her evidence was at best peripheral to the matters I have to decide.
58. In an attempt to minimise the significance of the printed contents of the notepaper used by Mr Brown Mr Halpern submitted that what was important was the impression that the printed footer would convey (and did convey) to someone with Dan's "known limitations" (as he put it). The pertinent questions he said were whether Dan had an appreciation that the services which Mr Brown was providing were by him personally, rather than as a consultant to Wychwood and, if the latter, whether he realised that Wychwood was not a firm of solicitors. He submitted that Dan understood his relationship to have been with Mr Brown personally, not with the entity referred to in the printed footer, and that, as Dan had stated (and Jennifer as well), little if any attention was paid by them to the footer and, if it had been, they would not have questioned or understood it.
59. Mr McPherson submitted, however, that the fact that Dan (or for that matter Jennifer) may not have paid much if any attention to the printed footer (or to the other printed material on the notepaper which Mr Brown used) and would not have attached significance to its contents if they had is not the point. The point, rather, is the manner in which Mr Brown conducted his administration of the two estates, including the references to himself in all of his letters to Dan and Jennifer as a consultant in Wychwood, and what light those matters throw on the capacity in which he was acting.
60. I agree with Mr McPherson's submission. It is part and parcel of his wider submission, which I have accepted, that Dan's understanding of the capacity in which Mr Brown acted is of value only if the basis for it is well founded. Approaching the evidence in that way, the picture which emerges is the following.
61. First, at no stage in the course of his administration of the two estates did Mr Brown say to Dan or Jennifer, or to any one else for that matter, that he was administering the estates in his capacity as a solicitor.
62. Second, the notepaper that he used in his communications with Dan and Jennifer, and in most although not quite all of his other communications, was not of the kind that a solicitor is required to use to a client (or otherwise in the course of his practice). For example, there was no reference to himself as a solicitor. On the contrary, its reference to himself in the printed footer as a consultant with Wychwood suggested that Mr Brown was not acting as a solicitor.
63. Third, it is significant that, so far as can be judged from the terms of his application to Zurich in 2002 for indemnity cover, Mr Brown did not regard himself as being in practice as a solicitor in the period prior to March 2002 during which (as the voluminous correspondence shows) he had been so heavily involved in the administration of the two estates. The facts about that are as follows.
64. On first applying to Zurich for cover Mr Brown had been required to complete a form headed "new business application form". The form in question was signed by him on 19 June 2002. In the form he gave CS Law as the name of the practice, supplied an address in Walsall as the main office and inserted 1 March 2002 as the "date established" for the practice. He stated, in answer to another question, that there was no other office for which he was seeking cover. He stated "none" in answer to a request to list "the names of all prior practices to which this practice is a successor practice". (I examine the significance of this answer when I come later to consider whether the second of the qualifying conditions was satisfied.) The form also indicated that he was to be the sole principal, in other words that he was intending to be a sole practitioner. A request that he state the "gross fees for the last annual accounting period or, if you are a new practice, estimated fees for the coming year" produced the round figure of £105,000.
65. There was debate before me on whether that figure related to the previous accounting period or was an estimate of fees for the coming year. It is overwhelmingly likely, in my view, that the figure was an estimate of the fees to be earned in the coming year. The figure is a round sum and is to be compared with the figures inserted when Mr Brown completed proposals for continued indemnity cover in subsequent years, for example the figure for 2002/2003 of £36,882 supplied in connection with the policy year 2003/2004. If he had regarded himself as having been in practice as a solicitor in the previous year (that is in the period prior to 1 March 2002) and had considered that the work he was carrying out as a personal representative of the two Whitehead estates was work undertaken as part of that practice, he could not properly have completed another section of the application form headed "Area of practice" in the way that he did. This section required Mr Brown to "[p]rovide the percentage of gross fees allocated to each Area of Practice or, if a new practice, estimated percentages for the coming year ..." There then followed 28 areas of practice. Against "Debt Collection" he inserted "100%". All other areas, including the area "Trust Probate and Wills Tax Planning", were left blank. If, when completing this section, Mr Brown had had in mind the work he had carried out in the preceding year in administering the two estates he could not properly have left blank this area of activity.
66. That this section, as completed by Mr Brown, was looking prospectively rather than retrospectively is reinforced by the fact that (as I have already related) in September 2001 Mr Brown had invoiced Mr Whitehead's estate for £38,000 "on account of my agreed fees for the administration of the Estate of R G Whitehead deceased" and, some days later had instructed National Westminster Bank, which held the estate account, to transfer that amount to an account in France in the names of himself and his partner, Ms Stevens. This is scarcely something that Mr Brown would have overlooked if had in mind the previous year when completing this part of the application. Insofar as the statement of gross fees and the statement of areas of practice look prospectively to the expected position for the forthcoming year, it is significant in its omission of any intention to carry out work in any area of practice other that Debt Collection.
67. It seems reasonably evident therefore that Mr Brown did not regard the work he was doing in his capacity as personal representatives of the two estates (by June 2002 very little indeed it has to be said) as work which would be carried out in connection with CS Law's practice.
68. It is not suggested by Mr Halpern that when Mr Brown completed the proposal form which led to the inception of indemnity cover in 2002 he did so dishonestly. Instead, he submitted that it was irrelevant what Mr Brown stated to his insurers about the nature of his practice and that he completed his initial proposal form on the basis that CS law was a new practice if, in fact, the work he undertook as personal representative of the two estates was properly to be regarded as part of a legal practice conducted by him. In the context of his application for professional indemnity cover, I took this to mean either that Mr Brown had misunderstood the character in which he undertook that work or else that he had simply overlooked it (though this seems unlikely) when completing the form and assumed, wrongly, that CS Law was a new practice when in truth it was no more than the continuation (under the new name of CS Law) of an existing practice hitherto conducted in his own name. I regard this as an altogether improbable explanation and do not accept it.
69. It is exceedingly unlikely therefore that, acting honestly (as Mr Halpern accepted that he did), Mr Brown could have completed his application for professional indemnity cover in this way if he had thought that work in the administration of the estates had been undertaken by him as a solicitor.
70. Fourth, although, as the findings of the Solicitors Disciplinary Tribunal in October 2007 make clear Mr Brown was not scrupulous in the observance of the professional obligations to which, as a solicitor, he was subject (and was struck off the Roll of Solicitors as a result), it is to be noted that for all of the time of his active involvement in the administration of the two estates (i.e. up to February 2002) he was without professional indemnity cover and for some of that time was without a practising certificate. By contrast to that, for all of the time that he practised as CS Law he had the benefit of professional indemnity cover and for all of that period except the 22 day period in January 2005 (which was the subject of one of the adverse findings against him in the proceedings before the Tribunal) he had a practising certificate. To have been carrying on work in that earlier period without such authorisation and indemnity cover was, to put it mildly, folly of a high order if, in truth, he was and understood himself to be in private legal practice throughout the time that he so acted.
71. Fifth, in several letters to persons other than Dan and Jennifer, written in connection with the administration of the estates, Mr Brown in terms stated that he did not practise as a solicitor. For example, in a letter dated 8 March 2000 to the Taxes Office in connection with the inheritance tax payable in respect of Mrs Whitehead's estate, Mr Brown (on notepaper containing the printed footer) stated in terms that "I am admitted a solicitor, although I do not currently practise as such". In a letter dated 2 August 2000 (again on notepaper containing the printed footer) to a firm of solicitors acting for the purchasers of the Whiteheads' former home - which was being sold in two separate lots - Mr Brown stated that "I am a solicitor but I do not practise as such. I have instructed Mr Christopher Adams of Corsellis (a firm of solicitors) to act on the two sales". In a letter dated 17 October 2000 (again using notepaper containing the printed footer), this time to Lloyds TSB in connection with Mr Whitehead's estate, Mr Brown stated that "I am admitted as a Solicitor although I do not currently practise as such. I will therefore use the services of an agency solicitor, solely for the purpose of lodging the Probate application to the Court…" The letters in question go back to before the grant in respect of Mrs Whitehead's will and continue until shortly after Mr Brown had obtained a grant in respect of Mr Whitehead's will. The position could scarcely have been made clearer.
72. As against the letters referred to in the preceding paragraph, Mr Halpern was able, as I have mentioned, to point to and place reliance on letters (there are six or so of them in all) in which Mr Brown carried out some action as a solicitor or referred to himself as a solicitor without, in either case, stating that he did not practise as such. I have already referred to several of them, for example the letter dated 23 April 2001 to Lloyds TSB. It is to be noted however that Lloyds TSB required a solicitor's undertaking in connection with a proposed loan from which the inheritance tax on Mr Whitehead's estate was to be paid. So also did National Westminster Bank to which, as I have mentioned, Mr Brown turned for assistance when Lloyds had declined to provide him with the loan that he was seeking. Mr McPherson submitted that these letters arose in nearly every instance where a discrete task was involved which a solicitor was required to perform and which, as a solicitor, Mr Brown was willing to undertake. I see much force in the submission. It is noteworthy also that in the case of Lloyds TSB Mr Brown had already written the letter referred to at paragraph 45 stating that, although a solicitor, he did not practise as such.
73. There were two letters which Mr Brown wrote in which he referred to himself as a solicitor where no discrete task was involved which required the services of a solicitor and in which he did not state that he did not practise as such. I have already referred to them. One was Mr Brown's letter of 13 January 2000 to Oxfordshire County Council in an attempt to obtain a place for Mr Whitehead in a day-care centre. The other was the letter which Mr Brown wrote in June 2001 to the Royal Mail seeking redirection to him of Mr Whitehead's mail and in which he referred to himself as a solicitor and the executor of Mr Whitehead's estate. Mr McPherson described Mr Brown's references to himself in those letters as an attempt to exercise "clout". They certainly have that appearance. In neither example does Mr Brown say in terms that it was as a solicitor that he was acting in their administration.
74. Viewing these very few letters in the context of the several hundred letters in which Mr Brown made no reference to his status as a solicitor or made clear (which, as I have mentioned, he did in some of them) that he did not practise as solicitor, I do not consider that these few should be taken as an indication that Mr Brown was acting throughout and in all aspects of the two administrations as a solicitor in private practice. It is noteworthy that whenever a legal action had to be done which only a practising solicitor could lawfully perform, for example extracting a grant of probate, Mr Brown instructed another solicitor to do it.
75. My conclusion is not affected by the fact, to which Mr Halpern understandably attached weight, that in a number of his letters to Dan (and in one or possibly more to Jennifer) Mr Brown gave advice of a kind that a solicitor would give. In this regard it is inevitable that someone who is conducting the administration of an estate will seek to explain to the beneficiaries what this involves, for example, the need for probate and the process by which it is obtained, the impact of inheritance tax and how it is to be paid, and the beneficiaries' entitlements and how that they are to be satisfied. It is likely that such explanations will be given in the same way that a solicitor would advise if he were retained to act in the administration. A bank executorship company, appointed as executor of an estate, would do so in exactly the same way. Of itself, the giving of advice of this kind is no more than a factor to be taken into account. It does not inevitably mean that the giver of the advice, if a solicitor, is acting as a solicitor when giving it.
76. There is one further matter I should mention. Although, as I have explained, Dan said he paid little or no attention to the printed footer, the fact is, as emerged in his cross-examination, that shortly after his father's death he had noticed the footer on Mr Brown's letters to him sufficiently to arrange for a company search against Wychwood to be undertaken. What is more, he instructed a firm of solicitors in Yorkshire to do so. That search disclosed that Wychwood was a "General Commercial Company", that Ms Stevens (whom Dan knew to be Mr Brown's lifetime partner) held 499 out of its 500 issued shares and was its sole director (with Ms Janet Mayer holding other share) and that Mr Brown was its secretary. Dan said that he was concerned to know who controlled Wychwood and was reassured to discover that the shares were held by Ms Stevens whom he believed was holding them for Mr Brown. (On the topic of reassurance, Dan was aware that, as a letter dated 15 May 2001 from Mr Brown to a Mr Peter Softley, a Business Manager with National Westminster Bank, written in connection with Mr Whitehead's estate, delicately put it:

"…Anne Stevens and I primarily work for Wychwood Consultants… Our income fluctuates according to the Company's circumstances and, in my case, a wish not to evidence significant income because of my past and unhappy divorce…")

77. Four comments are merited. First, the existence of Wychwood and Mr Brown's relationship to it, evidenced by the printed footer, had plainly impacted upon Dan's consciousness. Second, rather than simply ask Mr Brown about the matter, he had instructed a firm of solicitors to do the search from which the information about these matters might be forthcoming. Third, it would have been plain from the search, and Dan eventually accepted in cross-examination, that Wychwood was not a firm of solicitors so that, on the face of it, Mr Brown was writing letters as a consultant with a trading company. Fourth, Dan accepted that if he had paid more attention to the printed footer he would have realised that they came to him from Mr Brown as consultant to Wychwood. It further emerged in Dan's cross-examination that he continued to use the same firm of solicitors on "many" subsequent occasions. It was evident therefore that, if at the time Dan had understood Mr Brown to be a practising solicitor and had looked upon him as somebody who in the past had advised his family in legal matters and to whom he could look for advice as a solicitor in the future, it is somewhat curious that he looked to another firm to act for him on other occasions.
78. All of this reinforces my view that I have reached. That is that, given the printed footer on practically all but about 30 of the very many letters which Mr Brown wrote while acting in the administration of the two estates, the absence of any reference in them to Mr Brown practising as a solicitor (let alone any reference in his letters to Dan and Jennifer that he was so acting) and the clear statements in some of his letters to others that although a solicitor he did not practise as such, Mr Brown did not act as a solicitor in private legal practice when conducting his administration of them. It follows therefore that the first of the two qualifying conditions is not satisfied.
79. I have not overlooked that Mr Brown drew remuneration for his services. Mr Halpern relied on this as a pointer to Mr Brown having acted as a solicitor in that solicitors charge for their services. Mr McPherson submitted that an examination of the facts pointed to a contrary conclusion. This was founded on the fact that the remuneration Mr Brown negotiated with Dan for his work, namely 3% of net realisable value of each estate, was to be "plus VAT…" Dan, for what it is worth, accepted that he was aware of this. Mr McPherson pointed to the fact that the printed footer disclosed that Wychwood had a VAT registration (as did CS Law when it was established in 2002) but that there was no basis for thinking (and there was no evidence before the court to indicate otherwise) that Mr Brown, if he was conducting the administrations in his own name (and not in connection with the Wychwood consultancy), also had a VAT registration. This suggested, he said, that the VAT charged on the remuneration for his services in the two administrations could only have been on the footing that it was Wychwood that was providing such services. I do not rely on this as a conclusive indication of the capacity in which Mr Brown was acting, but it is certainly a further point in support of the conclusion I have reached.

The Firm's Practice point

80. It follows from this conclusion that the second of the qualifying conditions - the need to show that the civil liability against which indemnity is sought arises "in connection with the Firm's Practice" - is also not satisfied. This is necessarily so because if the civil liability does not arise from "Private Legal Practice" it cannot arise "in connection with the Firm's Practice".
81. In case I am wrong in my first conclusion, and Mr Brown's conduct in the administration of the two estates did to any material extent arise from "Private Legal Practice", it is appropriate to consider whether the second of the qualifying conditions is also satisfied.
82. The question here is whether the provision by Mr Brown of his services in the administration of the two estates (assuming those services were provided by him in the course of private legal practice as a solicitor) arose "in connection with the Firm's Practice". "The Firm's Practice" is defined by clause 7.11 to mean "the Private Legal Practice carried on by the Firm, any Prior Practice and/or any Successor Practice".
83. The essence of Mr Halpern's submission on this point was that Mr Brown was in continuous private legal practice as a sole practitioner throughout the time that he acted in the administration of the two estates (and indeed before the Whiteheads' death), that he provided his services to the two estates in the course of that practice and that the use by him from March 2002 of the name "CS Law" was merely a change in style: previously he had practised as a sole practitioner in his own name; subsequently he took up practice (still as a sole practitioner) as CS Law. But the practice was the same: it continued seamlessly.
84. Mr Halpern supported this argument by pointing out that although by clause 7.10 of the Policy "The Firm" is defined to mean "…the partnership …or the sole practitioner…specified in the Schedule" and the Schedule describes "The Firm" as "CS Law" with an address in Walsall, it is clear, since Mr Brown was its sole principal (and was practicing as a sole practitioner), that CS Law was no different from Malcolm Brown practising in his own name. He pointed also to the definition of "The Insured" in clause 7.12 stating that that expression included "The Firm" and "each Principal".
85. Mr Halpern submitted that, given the definitions of "Private Legal Practice", "Firm's Practice" and "The Firm", and substituting Zurich for "The Insurer" and "Mr Brown" for "the Insured", clause 1.1 should be read as if it stated:

"Zurich to the extent and in the manner hereinafter provided hereby agrees to indemnify Mr Brown against any Civil Liability to the extent that arises from the provision of services in private practice as a solicitor (including the acceptance and performance of obligation as executor or other personal appointment) carried on by Mr Brown [or] any Prior Practice."

86. Neat though this argument is, I cannot accept it.
87. It is clear, to dispose of the point, that any practice, being a Private Legal Practice, carried on by Mr Brown immediately before and in the months leading up to the inception of CS Law in 2002 does not qualify as a "Prior Practice". To have done so would have required a transition of the kind referred to in the relevant definitions set out, so far as material, at paragraph 23 above. The Minimum Terms make abundantly clear that the "transition" must result in the practice to which the Successor Practice succeeds (being a practice which existed "immediately prior to transition") being "no longer ...carried on as a discrete legal practice". (See clause 8.18 of the Minimum Terms.) That is quite contrary to what, according to Mr Halpern, had occurred. As I have just explained, the essence of Mr Halpern's submission was that Mr Brown practised continuously as solicitor in private practice from before he began to use the style "CS Law" and that the practice continued, in effect, seamlessly after Mr Brown began to use the style CS Law. If that was so, there could not have been any material "transition" from the one to the other. Indeed, in paragraph 38 of his skeleton argument Mr Halpern submitted that the fact that Mr Brown did not advise Dan or Jennifer that CS Law was "taking over" was "further proof that there was no succession: he had previously provided legal services personally and henceforth was doing so under the style of CS Law."
88. In this connection, it is to be noted that when completing the application to Zurich for professional indemnity cover, initially in June 2002 (for the period 2002/2003) and also for each succeeding period, Mr Brown either stated "none" or failed to supply any details in answer to a requirement to list "the names of all prior practices to which this practice [i.e. the practice to which the application for cover related, in the instant case CS Law] is a successor practice". In the first three of the four successive annual applications for cover made to Zurich the requirement invited the applicant to refer to the definition of "successor practice". If therefore Mr Brown had thought that prior to practicing as CS Law he had been in private legal practice, he plainly did not consider that he had done so in a "Prior Practice".
89. Having disposed of that possibility, I return to Mr Halpern's principal submission, namely that Mr Brown was in private legal practice from before the death of Mr and Mrs Whitehead, that his conduct of the administration of their estates was in the course of that practice and that this practice continued into and after 2002 when he adopted the style "CS Law" in the conduct of that practice.
90. As Mr McPherson pointed out, however, the second of the qualifying conditions requires that the provision of the services in private practice should be "in connection with the Firm's Practice" (emphasis added), that is to say, in connection with the private legal practice carried on by CS Law (or any prior practice). In my judgment it is not permissible, on a true understanding of that clause, to substitute Mr Brown (or Malcolm Brown) for CS Law – as Mr Halpern seeks to do – merely because CS Law was a sole practice and Mr Brown was the sole practitioner engaged in that practice.
91. My reasons for this conclusion are as follows. The Policy is worded to indemnify against civil liabilities arising in connection with an identified practice, namely the practice carried on as CS Law (and, as the definition of firm's practice in clause 7.11 explains, any Prior or Successor Practice). The short point therefore, having disposed of the Prior Practice possibility, is whether the private legal practice (assuming that it was such) carried on by Mr Brown prior to March 2002, in the course of which he administered the two estates, was the same practice as CS Law. In my judgment it was not. The adoption of the name CS Law was not merely (as Mr McPherson put the point when arguing against Mr Halpern's submission) a rebranding, as CS Law, of an existing and continuing practice. It was a wholly new venture.
92. That it was a wholly new venture, and was so regarded by Mr Brown, is abundantly apparent from the information supplied by him to Zurich in June 2002 when he applied for professional indemnity cover for the practice. I have already reviewed the relevant material at paragraphs 64 and 65 above. As that material shows, the nature of the practice was to be exclusively that of debt collection. The curriculum vitae dated 4 April 2002 which Mr Brown supplied with his application for cover did not suggest that he was then already, and had for some time been, in private legal practice. On the contrary, it referred to him as a "legal, business and tax consultant" and to a range of other activities in the period May 1984 (following his resignation from Clifford-Turner the previous month) to the end of February 2002. Debt collection - the work to be carried on by CS Law – appeared as an entirely new departure. Conspicuous by its absence from the application as an area of practice of CS Law is any activity remotely connected with probate and the administration of a deceased's estate. The new practice was to be located in Walsall in the West Midlands. There is no suggestion that it had been or was also to be carried on from 28 Old Brompton Road in London SW7. CS Law acquired its own headed notepaper containing references to Mr Brown as its principal, to the fact that it was registered with the Law Society and to its VAT registration number. Moreover, Dan and Jennifer were wholly unaware of the name CS Law or of the practice's Walsall address in 2002, 2003 or for much of 2004. Dan only discovered its existence and whereabouts in late October 2004. This discovery enabled Dan to send Mr Brown a lengthy and detailed letter, dated 25 October 2004, complaining about his conduct of the administration of the two estates. (It is the document relied upon as constituting the "claim made" for the purpose of clause 1.1 of the Policy.) Yet, when he completed a proposal form to Zurich in September 2005 for professional indemnity cover for the insurance year 1 October 2005 to 30 September 2006, Mr Brown made no disclosure of the claim which Dan had sent to him. This is noteworthy because Mr Brown's letter to his brokers in connection with the Policy's renewal disclosed a possible claim (concerned with the conduct of certain debt collection litigation) made in the previous insurance year. If Mr Brown had for one moment considered that the claim intimated by Dan in his letter of 25 October 2004 related to his conduct of a private legal practice and, what is more, that the claim was covered by the Policy, he would have had every reason for disclosing the fact and no reason for concealing it.
93. Thus, it is abundantly clear that in Mr Brown's mind the practice of CS Law had nothing whatever to do with his activities prior to CS Law's inception in 2002 and nothing therefore to do with his conduct of the administration of the two estates. In my judgment it is clear that this perception by Mr Brown was well founded. Therefore, even if, contrary to the available evidence (and, I have little doubt, contrary to his own belief) Mr Brown had conducted a private legal practice when acting in the administration of the two estates, that activity clearly had no connection with the practice of debt collection which Mr Brown established as CS Law in 2002.

Result

94. I shall make the declarations sought by paragraphs 1 and 2 of the prayer for relief in Zurich's particulars of claim and dismiss Ms Barnes' counterclaim.
95. It is obviously a matter of regret if this means that Dan and Jennifer have suffered loss from Mr Brown's conduct of the two administrations which cannot be made good by insurance and will be irrecoverable from Mr Brown personally. If, however, I had reached the contrary conclusion Zurich might with some justice have thought it perverse that it should be providing indemnity against civil liabilities wholly unrelated to debt collection (as it understood the nature to be of the practice for which it was providing cover) and in respect of a legal practice (if such it was) that existed prior to the time when cover began despite being informed that there was no prior practice. I must simply state the result as I see it and put aside any sympathy I may feel for the disputants.