Mr Justice Underhill :
- The Defendant. The Defendant, Kenneth Green, is the sole principal of a business called Green Denman & Co. ("GD"), who are insurance brokers and independent financial advisers. He has been in business for over thirty years and has a specialist expertise in executive pension schemes. He is clearly eminent in his field and is an experienced professional and businessman. Two sons, Andrew and Michael, work with him in the business. Andrew in particular was closely involved in the matters which have given rise to these proceedings. For convenience, and without intending any disrespect, I will refer in this judgment to Kenneth Green as "Mr. Green" or "Mr. Green senior" and to Andrew by his first name. Where it is necessary to refer to the two of them together I will do so as "the Greens".
- Imagination and Skandia Life. One of GD's clients was a company called The Imagination Group Ltd. ("Imagination"), for whom Mr. Green arranged a commissionbased executive pension scheme (known as EP 3) with Skandia Life Assurance Co. Ltd. ("Skandia"). In early 2001 Imagination decided to transfer to a different scheme ("Professional Life"/"PLAC"), provided by an associate company of Skandia, which was not commission-based. This meant a substantial loss to GD; but it was also, Mr. Green believed, disadvantageous to Imagination and its employees. He believed that Skandia had not given Imagination a fair presentation of the respective advantages of EP 3 (or a successor scheme called EP 4) and Professional Life.
- The Skandia Proceedings. In February 2003 Mr. Green issued proceedings in the Chancery Division against Skandia on the basis that it had induced Imagination to switch schemes in breach of what he claimed were implied terms in the contract between them. He estimated GD's loss at over £7 million. He initially instructed a firm of solicitors called Rooks Rider. He became dissatisfied with their service; and in late 2003, in circumstances to which I shall have to return, instructed in their place Marshall Ross Prevezer ("MRP"), whose former partners are the Second Defendants to the Counterclaim. The matter was handled there by an experienced but unqualified "old-style managing clerk", Mr. Tony Kirton. In November 2005, MRP merged with the Claimants, Manches LLP ("Manches"): Mr. Kirton remained in charge of the case. Where it is unnecessary to distinguish I will in this judgment refer to Manches and MRP together as (albeit strictly inaccurately) "the Claimants". In July 2006 Mr. Christopher Nugee QC, sitting as a deputy High Court Judge, gave "reverse summary judgment" against Mr. Green on most of the issues in his claim against Skandia: some parts of the claim were stayed, but it is now clear that they will not be pursued. Mr. Green has a substantial liability, or contingent liability, to Skandia for the costs of the action.
- The Bills. Over the period from early 2004 until the effective dismissal of the claim in July 2006, MRP and Manches between them billed Mr. Green for fees totalling £734,944. Of that amount, he has paid the full sum billed by MRP, namely £344,637.60, together with £39,000 billed by Manches. In these proceedings, commenced on 4 May 2007, Manches claim the outstanding balance, namely £351,307.29 (plus interest). The bills in question have, by a consent order dated 26 July 2007, been referred for assessment by a Costs Judge, but on the basis that the assessment is stayed pending the decision of the issues which are now before me.
- The Pleaded Issues. Mr. Green denies any liability to Manches on the outstanding bills, and counterclaims against both Manches and MRP for repayment of the lion's share of the bills already paid. He also claims damages equivalent to his liability in costs (not yet fully ascertained) to Skandia. The pleaded basis for that defence and counterclaim resolves into four points:
(1) The Pilbrow point. Mr. Green alleges that he had engaged MRP, and subsequently Manches, on the express basis that he would have the services of a qualified solicitor, and that it was never explained to him that Mr. Kirton was not a solicitor. The Greens say that this is something of which they were wholly unaware until the conclusion of the hearing before Mr. Nugee. Mr. Green says that that constituted a fundamental breach of duty such that neither firm was entitled to recover any fee for its services: he relies on the decision of the Court of Appeal in Pearless de Rougemont & Co. v. Pilbrow [1999] 3 All ER 355 ("Pilbrow"). He thus claims not only that he has a defence to the entirety of Manches' claim but also that he has a restitutionary claim for repayment of the £39,000 paid to them and the entirety of the monies paid to MRP: such a claim was allowed in Adrian Alan Ltd. v Fuglers [2002] EWCA Civ 1655 The relevant averments are at paras. 6, 9, 12-13 and 28 of the Re-Amended Defence and Counterclaim.
(2) Mr. Adams. Mr. Green alleges that MRP were negligent in failing timeously to ascertain whether the Finance Director of Imagination, Mr. Richard Adams, would be prepared to give evidence in support of the claim against Skandia. It is common ground that Mr. Adams' evidence was crucial to the claim; but he was not approached until April 2005. When he was eventually approached it transpired that he was very unwilling to assist; but Mr. Green says that he was not told this. He says that if Mr. Adams' attitude had been ascertained, as it should have been, in or around February 2004, or in any event if it had been properly communicated to him once ascertained over a year later, he would not have proceeded any further with the Skandia litigation. On that basis Mr. Green not only denies liability on the outstanding bills but claims damages equivalent to the full amount paid to MRP since February 2004, namely £295,734.58, plus the £39,000 paid to Manches and the amount of his costs liability to Skandia. The relevant averments are at paras. 11, 14-17 and 22-23 of the Re-Amended Defence and Counterclaim.
(3) Practice Rule 15. Mr. Green pleads at para. 10 of the Re-Amended Defence and Counterclaim that it was an implied term of the retainers of both firms that they would "conduct themselves in accordance" with rule 15 of the Solicitors Practice Rules 1990, and specifically with the requirement under head (a) of that rule that they should give proper information about costs. Para. 21 (b) of the Re-Amended Defence and Counterclaim pleads a breach of that obligation in that:
They failed to give to the Defendant the best information possible about the likely overall costs, including a breakdown between fees, VAT and disbursements, including giving a realistic estimate of costs or a forecast within a possible range of costs.
At the start of the trial I gave permission to re-amend that sub-paragraph to add three more specific allegations by way of particularisation of the general plea made in it. For reasons which will appear, I need not set out those particulars in full: Mr. Green's essential point is that the bills eventually incurred were far in excess of any estimate that he had ever received (and in particular of an estimate for the costs of the whole action which he was given in October 2005 to include a three-week trial, of £440,000).
(4) The Solicitors Act. By a further re-amendment permitted by me, Mr. Green puts Manches to proof that each of the bills on which they sue was signed by a partner as required by s. 69 (2) of the Solicitors Act 1974.
(There is also an unparticularised plea at para. 21 (c) of the Re-Amended Defence and Counterclaim to the effect that Manches and MRP failed to advise Mr. Green that the likely outcome of the Skandia proceedings would not justify the expense and risk involved in bringing them. But Mr. Prestwich, for Mr. Green, helpfully confirmed that this plea was not intended to raise any allegation of a specific breach of duty over and above that relating to Mr. Adams. In this connection I should mention that Mr. Green addressed evidence from a Mr. Bridge, a Skandia employee who it was said could have given useful evidence but from whom MRP failed to take a statement. His evidence which was in any event extremely limited, went to no pleaded issue.
- Status of the Rule 15 Issue. Mr. Sweeting QC for Manches and MRP submitted that Mr. Green's case as regards this issue was misconceived. In the first place, it was not right to imply into the retainer a term that the firms would comply with rule 15 of the Solicitors Practice Rules: as to this, he referred me to the judgment of Morgan J in Mastercigars Direct Ltd v Withers LLP [2007] EWHC 2733 (Ch), esp. at para. 107. Thus, he submitted, the only basis on which the claim was pleaded fell away. Further though this may on analysis be another aspect of the same point the particular complaints which Mr. Green wishes to raise under this head are all matters which can more appropriately be determined as part of the assessment by the Costs Judge: he referred by way of illustration to such cases as Wong v Vizards (1997) 2 Costs LR 46 and Anthony v Ellis & Fairbairn (2000) 2 Costs LR 277, in both of which the fact that the solicitors had given a serious under-estimate of costs led to the Court making an assessment at a substantially reduced level. As he pointed out, the case before me had not been prepared in such a way as to enable me to form any reliable view on the justifiability of the bills or, more particularly, on the reasons for any divergence from the estimates given: I had no statements relating to that issue and few relevant documents. I made it clear to Mr. Prestwich at the start of his closing submissions (reinforcing an indication given in the course of his opening) that I did not feel able to determine the issues pleaded under this head; and he did not pursue it. The underlying complaints are of course fully open to Mr. Green on the assessment.
- The Principal Witnesses. It is convenient at this stage to say something about the evidence which I heard from Mr. Kirton and from the Greens. Mr. Kirton had provided a reasonably full witness statement, cross-referred to the principal relevant documents. He gave his answers under cross-examination in a careful and generally straightforward manner. It was clear, however, that his independent recollection was limited and not always particularly reliable: his evidence was, necessarily, largely dependent on his contemporary notes and letters. The witness statements of both Mr. Green and Andrew were inadequate. They dealt only briefly with most of the key issues and omitted some altogether. They made little reference to the documents, even those generated by themselves, although it must have been apparent that a number of them were of central importance to the case (particularly on the "Adams issue"). I sympathise with the view that witness statements often go into excessive detail, but these statements seriously erred in the opposite direction. Mr. Green senior was not an impressive witness under cross-examination. He clearly felt great hostility towards both firms, and Mr. Kirton in particular, and his answers often appeared motivated by a desire to show them in a bad light rather than to give the Court his best recollection of what had occurred. There was also an evident desire to distance himself from any active involvement in the conduct of the litigation. Detailed instances of these features of his evidence and of its unreliability when tested against the documents appear from the narrative below: a particularly striking example appears at para. 34 (2) below. I have borne in mind that he has not been in good health in recent years, but I can only judge the reliability of his evidence as given. Andrew Green likewise tended to give a partisan spin to his answers. These criticisms, both of the statements and of the oral testimony of the Greens, do not mean that I should necessarily reject their evidence; but they do mean that I need to be wary of relying on it except where it is supported by the contemporary documents.
- The Structure of this Judgment. I will deal with the three surviving issues, which are largely self-contained, separately, although I will do so in a different order, taking the "Adams issue" first. However, it is convenient before I embark on that process to set out a summary narrative of the key events which are relevant both to the Adams and the Pilbrow issues.
SUMMARY NARRATIVE
- During the time that Rooks Rider had the conduct of the Skandia litigation little progress was made. It appears that proceedings were issued with the minimum of prior preparation, in the hope that Skandia might be brought to the negotiating table at an early stage. That did not occur: although there was apparently an indication that Skandia might be interested in mediation, for reasons which I need not explore nothing came of this. A Request for Further Information of the Particulars of Claim was served, and it was agreed that no Defence need be served until it had been answered. No Answer had been served prior to the transfer of instructions to MRP; and the action was effectively dormant. Mr. Green had had some advice from Mr. John Martin QC as far back as November 2001. This was not encouraging. In a Note dated 15 November 2001, Mr. Martin noted that "the tenor of the draft letters sent for my review suggests a belief by Mr. Green that I take a more optimistic view of his claim than is in fact the case." He also said that any suggestion to Skandia that Mr. Green had a claim "worth anything remotely like £7m will rightly be greeted with derision".
- MRP were recommended to Mr. Green by a neighbour called Phillip Lunn, who had used them in litigation of his own. Following Mr. Lunn's recommendation Mr. Green rang MRP and was called back by Mr. Kirton on 15 September 2003. Mr. Kirton was, as I have said, an unqualified managing clerk. He had, however, over thirty years' experience, principally as a litigator, and was trusted by MRP to take charge of major pieces of litigation, although he remained nominally under the supervision of the Head of the Litigation Department. He agreed to have a preliminary look at papers which Mr. Green sent him, on a no-charge basis.
- Following that initial contact and some further discussion on the telephone, Mr. Green agreed to instruct MRP. On 20 October 2003, Mr. Kirton wrote a formal retainer letter informing him that he would be handling the matter with the assistance of a consultant, Geoffrey Keens: I will have to return to the precise terms of this letter in due course.
- It took some time for the full papers to be obtained from Rooks Rider. But on 4 February 2004 Mr. Kirton wrote his first substantial letter of advice. The letter was addressed to Andrew: Mr. Green senior had recently had a major operation, and although he remained fully involved, Andrew both at that stage and subsequently undertook some of the burden of dealing with the lawyers. Mr. Kirton and Mr. Keens first saw both the Greens on 4 March 2004. Thereafter, priority was given to digesting the available papers and drafting a "general witness statement" for Mr. Green designed to give an overview of the claim. In due course Mr. James Dingemans QC was instructed, leading Mr. Thomas Roe. There was a consultation on 5 August 2004. The action at that stage remained dormant. Mr. Dingemans advised that consideration should be given to amending the Particulars of Claim to include a claim for conspiracy (and/or one of the other economic torts) and that an approach should be made to Skandia to explore the possibility of mediation. He advised on the further evidence required, including the need for a witness statement from Mr. Adams and from a Mr. Kuhler, who was an ex-Skandia employee who it was believed would be a helpful witness on any conspiracy claim. Mr. Dingemans also advised about what information needed to be obtained in order to quantify GD's loss. He was not in a position at that stage to give any firm advice about the merits or quantum or, therefore, about whether the claim was worth pursuing further. It is clear that his advice was fairly cautious in tone.
- Various work, still essentially of a preparatory character, took place in the autumn of 2004, and there was a further consultation with counsel on 17 March 2005. Mr. Adams had not been seen in the meantime. The decision was made to amend the Particulars of Claim to plead conspiracy as an alternative to the case based on an implied term, and to revive the action on that basis. Counsel were still, however, not in a position to express any firm view about the merits or quantum. As to the merits, MRP took the view that it was not likely to be possible to reach any useful view until Skandia's disclosure had been obtained.
- Amended Particulars of Claim were served in May 2005. Skandia served its Defence in July 2005. It was in November 2005 that Skandia issued its application for the claim to be dismissed under CPR 24. That led to a third consultation with Mr. Dingemans on 21 December 2005. The gist of his advice on that occasion was that - irrespective of the substantive merits (as to which he clearly remained cautious) - the only course open to Mr. Green was to resist the application, since realistic negotiations would only be possible if it were defeated; and advice was given on the evidential and other steps necessary for that purpose.
- The application was listed before Mr. Nugee on 26 April 2006. It had an estimate of one-and-a-half days, but in the event it extended over four days. Judgment was handed down on 7 July 2006. The claim for breach of contract was dismissed essentially on the basis that there was no reasonable prospect that Mr. Green could establish that any relevant term should be implied into his contract with Skandia. The claims in tort were stayed pending the decision of the House of Lords in the three appeals which have since been decided and reported as OBG Ltd v Allan [2008] 1 AC 1 ( [2007] UKHL 21 ). It seems now to be accepted that the decision in OBG makes it impossible for the stayed claims to be pursued.
- On 2 September 2006 GD wrote to Manches complaining about the level of their fees. The letter was signed by Andrew and Michael Green and their mother on behalf of Mr. Green senior. As I understand it, this is because Mr. Green was feeling under a lot of stress at that time: he felt "hounded" and was threatening to "jump off Beachy Head". It would appear to have been Andrew who was principally responsible for the drafting. The letter is fifteen pages long and, though courteous in tone, is forthright and detailed in its criticisms of the service received from both firms.
(A) THE ADAMS ISSUE
THE FACTS
- It is common ground that Mr. Adams' evidence was of crucial importance to the claim against Skandia, whether it were put on the basis of breach of implied terms or in tort. This is because it was necessary to show that Imagination would have stayed with the commission-based scheme but for the acts on Skandia's part of which GD complained. There was a serious risk to put it no higher that it would be found that Mr. Adams, who was in practice the decision-taker on behalf of Imagination, had decided to make the change irrespective of anything that Skandia might or might not have done; and in particular that (with the benefit of advice which he had received from an independent actuary, Mr. Wolanski) he had decided that a commission-based scheme was simply wrong for Imagination and/or its employees. In the Note to which I have referred, Mr. Martin, after expressing considerable doubt as to whether Skandia had been in breach of any obligation to GD, said this:
Even assuming that Skandia did break [such an obligation], however, there seem to me insuperable difficulties in showing that the breach caused any loss. The reality of the matter is that Mr. Adams was impatient with the consolidation process and anxious to achieve simplicity. His views may well have been the product of a failure of understanding, but they were his views nevertheless. Mr. Green had some opportunity (although not as much as he would have liked) to change those views, but Mr. Adams preferred the advice he was being given by Mr. Wolanski. In those circumstances, it seems to me unlikely that Imagination would have stayed with the commission-based product even if Skandia had refused to attend meetings without Mr. Green being present. The highest it can be put (again assuming that there was a breach of the implied obligation) is that Mr. Green lost the chance of retaining the business; but on any footing the chance was not a very great one.
That argument was referred to before me as "the causation point". I should note, because Mr. Green in his witness statement appears to believe to the contrary, that in the end it was not the causation point which led Mr. Nugee to dismiss the claim against Skandia; but that fact is not as such prejudicial to his case.
- Mr. Kirton, no doubt with Mr. Martin's views in mind, focused clearly on the causation point in his preliminary letter of advice dated 4 February 2004. Under the heading "The Way Forward", he identified the need to show loss and said:
Crucial in this section of your claim is:
(a)
(b) That Mr. Adams at Imagination would not have changed Plans had matters been properly explained.
Although concise legal argument is required such argument can only be based upon proper factual evidence. This would include:
(a)
(b)
(c) Evidence from Mr. Adams as to his stance on changing Plans. What his position would have been in the event that matters had been properly explained and lucid reasoning to explain both his stance and position on the advice given and the advice which should have been given.
I find it difficult to see how this matter can progress without this basic evidence. I find it even more difficult to comprehend why this has not been suggested to you in the past, and, if suggested why it has not been actioned. It appears to me that these are basic essentials which should have been attended to by your legal representatives when you first instructed them on this matter.
Equally we need to ascertain the stance of Mr. Adams. If you can confidently predict that Adams will be helpful then your only decision is whether you are to [sic] prepared to invest further monies in the litigation based on this confidence. Alternatively it may be the case you wish to approach Mr. Adams to ascertain his stance. In the event that he is not helpful from an evidential point of view then it is unlikely to prove loss from any breach.
He began the next section of the letter by emphasising that "the above steps are vital in order for us to obtain an alternative Advice from James Dingemans QC". He pointed out that at present Skandia would not be taking the claim seriously, and he said that in order "to re-establish credibility
we must
gather the evidence to which I have made reference above". In the final section of his letter - "Conclusion: the Decision" - he said:
I said at the outset there was only one decision to make. This decision is whether you wish to spend further monies on a matter which has not, with the greatest respect, been properly prepared. At the moment your claim appears to the Defendant no more than what I would term "a punt" and you are simply not being taken seriously. There is no guarantee of success we would need to work hard just for us to get you to a point of possibly being able to negotiate a resolution.
- That advice could hardly have been plainer about the centrality of Mr. Adams' evidence to establishing a viable claim. In the paragraph beginning "Equally we need
." Mr. Kirton offered Mr. Green a choice whether to approach Mr. Adams forthwith or to defer doing so until later; but he made it clear that the latter option only made sense if he were "confident" that Mr. Adams would assist. On the face of it the former course was obviously the more sensible, because, however well Mr. Green thought he knew Mr. Adams' views, complete certainty would not in the nature of things be possible and it was obviously prudent to be sure before expending further resources. Some solicitors might for that reason simply have advised Mr. Green that he must approach Mr. Adams (or ask them to approach him) forthwith. But I do not think Mr. Kirton can be criticised for giving Mr. Green the choice that he did. He was fresh to the case. He had not yet met either of the Greens. He knew nothing at that stage about GD's relationship with Imagination or Mr. Adams, and there might well be reasons why Mr. Green could reasonably prefer to take such risk as there might be in deferring an approach to Mr. Adams for the time being. The nature of the choice was clearly set out.
- Later the same day Mr. Kirton sent Andrew a second letter referring to conversations between them that afternoon and enclosing (among other things) a draft without prejudice letter to Rooks Rider relating to their outstanding bills. Both letters of 4 February 2004 were sent by fax.
- The following morning (at 8.45 a.m.) Andrew sent Mr. Kirton an e-mail. It referred in terms only to the second letter of 4 February, but it is clear from its contents and it has not been suggested to me otherwise that he had seen, and was in part commenting on, the first letter. The e-mail began:
Many thanks for the draft letter to Rooks Rider faxed over yesterday. Ken will be calling you at 9 a.m. to discuss. In the meantime, I have some observations which I hope will help. I have now had a chance to refresh my memory on the case and would make the following points:
(1) Yes, we can certainly obtain statements from Ken and Richard Adams at Imagination (and it's probably worth asking Ray Kuhler for one two as he was the Sales Consultant for Skandia who looked after Green Denman). Ultimately, Adrian Walker (Skandia's pension technician) would also be useful although he is still working for Skandia but is on our side. However, the stage at when these statements are sought is a matter for discussion [my emphasis].
I now recall the reason why Richard Adams of Imagination has not yet been asked for a statement prior to this. This was because Imagination are still not aware of what Skandia has done to them. It was considered that, from a negotiation point of view, it would be better to offer Skandia the opportunity to "put their house in order" and avoid the need for Imagination to become aware of their appalling behaviour. Ultimately, we can blow the whistle on them to Imagination but the best/appropriate time to do this is yet to be decided [my emphasis].
The e-mail proceeds to deal with other matters. I note that these include strong criticism of Mr. Farnsworth, the solicitor at Rooks Rider who had principally dealt with the matter: he is described as "unreliable, incompetent, dishonest and negligent". Andrew says that he would like to see him "brought to book". One matter about which he complains is that Rooks Rider sought to blame their inaction on GD, whereas, he claims, the true position is that "we were waiting for him
(not the other way around)." He observes "if a Solicitor says he is going to do something and neglects to carry it out, is that not a classic case of negligence?". The e-mail also shows a confidence in the case which is at odds with the advice which the Greens had previously received from Mr. Martin. Andrew says that Mr. Martin's pessimism was as a result of his not having been properly instructed by Rooks Rider. He expresses the view that Skandia "have a great deal to fear and a great deal to lose" and was "just bluffing" in its resistance to the claim. The final sentence of the e-mail reverts to the question of witness statements and says "if push comes to shove we can obtain the relevant statements to show Skandia up for what they are".
- The clear message of Andrew's e-mail of 5 February 2004, as regards Mr. Adams, was that although he and his father were very willing for him to be approached that should not occur forthwith: there needed to be further discussion about "the stage when these statements are sought".
- The same day Mr. Green himself spoke to Mr. Kirton on the telephone. Each made a note of the conversation. Mr. Green's note - written in manuscript on MRP's second letter of the previous day was as follows:
I have agreed that the "without prejudice" letter should go. Tony says Rooks Rider are very arrogant and may challenge. He feels that some of their bill will be struck out if taxed. He wants to consider how to approach Richard Adams. He will be doing that [my emphasis]. Skandia should have been advised that he is a key witness.
The statement "he will be doing that" is ambiguous, since the "that" which Mr. Kirton was to do could refer either only to the consideration of how to approach Mr. Adams or to the approach itself. Mr. Green claimed that it meant the latter, but this is not a matter on which it is likely that he had any independent recollection. Mr. Kirton's attendance note covers a number of other matters besides the approach to Mr. Adams. Among other things, it records Mr. Green telling him consistently with Andrew's e-mail - that Mr. Wilson of Skandia was "arrogant" and that Skandia "will not want the scandal". As regards Mr. Adams, the note reads:
Told him that whatever occurred on this matter, Adams remained the key. He must apply his mind to how we approach Adams.
- There is clearly a difference between the two notes as to what was said about the approach to Mr. Adams. According to Mr. Green's note, the ball was in Mr. Kirton's court, whereas according to Mr. Kirton's note it was in Mr. Green's. It is Mr. Green's case that the effect of that conversation was that, so far as Mr. Green was concerned, he was content for Mr. Adams to be seen as soon as Mr. Kirton judged appropriate, but that he left it to Mr. Kirton to advise on precisely when that would be and on the modalities of any approach. I do not propose to seek to resolve that difference at this stage.
- On 4 March 2004 Mr Kirton and Mr. Keens met the Greens, for the first time, at MRP's offices. There is a full attendance note of the meeting made by Mr. Kirton. It covers a wide range of matters, but I need only deal with those which relate to Mr. Adams. As to this, the note says as follows:
We discussed the role of Adams. Both AG and KG are of the opinion that Adams will assist. TK indicated that his initial view was that without Adams the claim failed.
TK said that it was important that we got to interview Adams sooner rather than later.
I should make two points about that note:
(1) It is inconsistent with any explicit instructions having been given to Mr. Kirton to approach Mr. Adams forthwith. It is not simply that the matter is being discussed as if it were still an open question: more specifically, the flavour which comes across is that it was necessary for Mr. Kirton to persuade the Greens of the need to see him "sooner rather than later".
(2) The reference to the Greens expressing the view that Mr. Adams "will assist" at least suggests that the question was being discussed in terms of the choice which Mr. Kirton had given them in his letter of 4 February (see para. 19 above): there is express reference to the "Way Forward" section of that letter in an earlier part of the attendance note.
- Following the meeting, work proceeded with a view to getting the case into better shape. On 12 and 13 July 2004 Mr. Kirton and Mr. Keens and an assistant called Rebecca Harris spent two days at GD's offices, which were at Mr. Green's home in Sussex, examining documents. On 14 July Mr. Kirton wrote to Mr. Green, primarily to obtain instructions to proceed to instruct counsel; but the letter also had a section about evidence. This reads:
You will recall in my previous correspondence that I have highlighted a number of issues which needed to be addressed. These included:
(a) The evidence of Richard Adams and in particular what his stance would have been had he known that a change to Professional Life would cause an increase in fees over and above the commission which was paid:
(b) Documentary evidence to support the various statements that we have made in the Particulars of Claim and indeed through your previous lawyers to Counsel: and
(c) Documentary evidence to support the losses and indeed our damages claim generally.
I believe that it is fair to say that we have, to a large degree, addressed item (b) above. We have not, however, addressed either items (a) or (c). It is therefore likely that Leading Counsel will only be able to give an indication on merit which will be "subject to" the stance of Mr. Adams and our ability to quantify the damages claim. I would ask that you bear this in mind when we see Leading Counsel in conference.
We do need to be dealing with the Adams situation and also quantification of your claim. So far as the latter is concerned, the starting point of all this will be (as we have discussed yesterday) your level of earnings arising from the relationship with Imagination which, in turn, will need to be separated into direct commissions and what I will term "spin-off" business. You will also need to decide how to approach Mr. Adams [my emphasis].
I repeat, once again, that if the stance of Adams would have been no different (in other words he would have transferred to Professional Life anyway), your claim will more than likely fail. It is for this reason that I have stressed throughout our correspondence the importance of Adams to your position [my emphasis].
The terms of that letter are, again, inconsistent with Mr. Kirton believing that he had already been instructed to approach Mr. Adams. On the contrary, they are suggestive of a reluctance on the part of the Greens for Mr. Adams to be approached at that stage. It is right to say that there was no evidence from Mr. Kirton that any such reluctance had been expressed to him. Nevertheless, it can be inferred from the terms of the letter that he believed it to be present, whether expressed or merely tacit.
- On 16 July 2004, i.e. two days later, Mr. Green and Mr. Kirton spoke on the telephone. Again, both made notes of the conversation. Mr. Green's note reads as follows:
16/7/04 Tony Kirton
He wanted to discuss situation and matters before proposed meeting with Counsel. He wants to instruct James Dingemans and retain his junior. I said that if he thought that was best then go ahead.
ADAMS:- How and when is best approach? He said that he would be the person to go and see Mr. Adams and obtain any statement. Not advisable for me to do it because it must be done in a certain way. I must not tell Adams any details of the case as it may compromise things later. I said that Adams was a strange and weak character and it was difficult to predict what he would say. Imagination have been taken for a ride by Skandia and he probably won't like it. Tony agreed.
Time is against us now and it is essential that JD sees the papers and we meet him without delay. Seeing Adams may not be possible in the short term. Depends how long before Counsel is able to see us. Tony said he might leave Adams until he hears what JD has to say. Tony said case also depends on disclosure. He felt case would be won or lost on disclosure. He will let me know when the meeting with Counsel is arranged.
Confirmed I had records of commission statements from Skandia for Tony's purposes.
As there appears, the date of the consultation with Mr. Dingemans had not yet been fixed: in the event it occurred on 5 August 2004, i.e. some three weeks later. Mr. Kirton's attendance note covers the question of Mr. Adams much more shortly. It reads, so far as relevant:
He wants to leave Adams until after we have had Counsel's advice. He appreciates the caveat which may be put in place.
It is clear that the "caveat" referred to is the point made in the letter of 14 July that leading counsel's advice would have to be qualified if it were not known what Mr. Adams would say on the causation point. The same day Mr. Kirton wrote to Mr. Green confirming the conversation. The letter said, inter alia, "in the meantime I note
that you wish to leave the 'Adams situation' until the advice from Counsel".
- There is, again, what Mr. Sweeting described as a tension between Mr. Green's note on the one hand and Mr. Kirton's note and letter on the other. On a superficial reading, Mr. Kirton's note suggests that it is Mr. Green who wants to put off the approach to Mr. Adams, while Mr. Green's note indicates that that suggestion came from Mr. Kirton himself. But I do not in fact think that the two are irreconcilable. Mr. Kirton's note can be understood as simply recording Mr. Green's acceptance of his recommendation. On this basis, the conversation is of limited significance. It is concerned only with a short delay in approaching Mr. Adams until after the consultation. I do not believe that Mr. Kirton can sensibly be criticised, as at that date, for recommending that delay for the reasons which he gave. The real questions are why Mr. Adams had not been seen already and why, to anticipate, he was not seen shortly after the consultation with Mr. Dingemans. This episode casts no direct light on those questions. What is, however, worth noting is that Mr. Green's own note shows that he was contrary to what he appears to have said previously expressing significant doubts about how helpful Mr. Adams would really be; also that it contains no suggestion that Mr. Kirton ought already to have approached him.
- The consultation with Mr. Dingemans took place on 5 August 2004. Extremely full notes were prepared by both Mr. Kirton and Mr. Keens. Mr. Keens' note contains the following passage:
Once the Claimant overcame the hurdle of proving breach of an implied term or conspiracy to injure then it was an important question (of causation) whether this would have made the slightest difference in the event.
Put it another way if Skandia's EP4 product had been presented to Imagination would they have accepted this and not have turned to the PLAC Scheme.
It was clear from JD's analysis of the chronology that Adams, driven by Wolanski, was looking for simplification.
It was very important that a witness statement be obtained from Adams [original emphasis].
Later in the note, under the heading "the Way Forward", Mr Keens noted:
The following needed to be obtained:
1.. A witness statement from Kuhler;
2.. A witness statement from Adams.
The part of Mr. Kirton's note addressing the importance of the evidence of Mr. Adams begins with the discussion of a letter dated 16 June 1999 which Mr. Adams had sent to GD apparently communicating a decision to dispense with the commission-based scheme. The essential parts of the passage read as follows:
33. JD turned to the letter of 16 June 1999. JD made it quite clear that he considered this to be a "Dear John" letter
KG did not agree. Lengthy discussion ensued. JD indicated that this was a "Dear John" letter which offered some hope of future involvement but which was not unequivocal. JD also fully accepted that it was written on a false premise. KG indicated that irrespective of JD's thoughts that he would expect to be invited to continue and they [i.e. Imagination] could not do the comparison [i.e. between the professional life and EP3/4 schemes] without him. JD indicated that whilst this maybe correct, he had read this as a goodbye letter and thinks the Judge would unless Richard Adams changes his mind. JD said this brought him to an important part of this matter which was namely the need to establish the facts from the perception of Richard Adams. KG confirmed he was still in contact with Richard Adams but there had been no insight from him on this aspect.
34. JD said that the financial incentives correspondence that KG had had with RA was useful. It would appear that all he had got was a simple thank you for pointing out matters. JD indicated that at some stage KG would have to make the decision on whether to jeopardise his business relationship by opening this ground again [my emphasis].
35. JD indicated that even if he took a neutral view, he could not read the letters the Ken Green way.
Later in the note the following passage appears:
89.
The question is would EP4 have made a difference to Richard Adams. HW [Mr. Wolanski] was what JD commented was a "one horse course man". The question is what evidence can we get from Adams to help our position. JD stressed that we need a statement from Adams [my emphasis].
90. KG then suggested that Skandia fear KG going back to Imagination to say that they are worse off. But at the same time he is not certain Richard Adams would be able to recall what he would or wouldn't do. JD said that in truth the question was really quite simple. JD stressed that we would need a statement from Richard Adams [my emphasis].
91. JD went on to suggest that he dealt with litigation on a day-to-day basis and without all of the evidence that he has put forward it would be very difficult to progress this matter towards trial. KG thinks Skandia will settle. JD said we could not fight this action on this premise. If they have a concern they will not go to Court, but if they think they are going to win, they would go to Court, just to send a message. KG is of the view that Skandia "want rid" of this case.
The Way Forward
92. JD indicated that we must identify a cause of action where the major weakness is causation. JD said that if we don't talk to Adams that's fine, but at the end of the day if he would not have changed his stance we lose on causation.
99. TOK said that at the outset of this matter, he had said that Adams would be the key. This remained the case. We need to know what would Adams have done in his mind set had he known about EP4 and in the absence of Adams we would have to rely on letters on which basis we would lose.
101. JD indicated that the way forward was:
(a) get the evidence from Kuhler;
(b) make a decision on whether to approach Adams
- A number of points emerge from those notes:
(1) Mr. Dingemans, supported by Mr. Kirton, made crystal clear the centrality of Mr. Adams' evidence and the consequent need to obtain a statement from him.
(2) There are indications that both Mr. Dingemans and Mr. Kirton had the impression that Mr. Green was reluctant for Mr. Adams to be approached. This appears most clearly from Mr. Dingemans' reference, recorded at para. 34 of Mr. Kirton's note, to Mr. Green having to decide "whether to jeopardise his business relationship" with Mr. Adams by approaching him. But the inference is also supported by the very emphasis which counsel put on the point, and which Mr. Kirton and Mr. Keens reflected in the way in which their notes were formulated: see, for example, the distinction made by Mr. Kirton in para. 101 of his note between "getting evidence" from Mr. Kuhler and "making a decision on whether" to approach Mr. Adams. I also note Mr. Green's remark, recorded at para. 90 of Mr. Kirton's note, that he was not certain that Mr. Adams would be able to give helpful evidence: this echoes what he had said to Mr. Kirton in their conversation on 16 July (see para. 27 above). There is no explicit indication in either note as to the origin of the lawyers' perception that the Greens were reluctant for Mr. Adams to be approached, or, more particularly, of Mr. Dingemans' understanding that approaching Mr. Adams might jeopardise GD's existing business relationship with Imagination; but in practice it can only have come from things said - even if not wholly explicitly by Mr. Green or Andrew to Mr. Kirton and communicated by him to counsel.
(3) If Mr. Green's case that he had authorised Mr. Kirton to approach Mr. Adams as far back as 5 February were correct, one might have expected to see some record of his protesting that he had no problem with Mr. Adams being approached and that he had already made that clear. But there is nothing to this effect: more specifically, there is no note of his telling Mr. Dingemans that, contrary to what he appeared to understand, he had no concerns about jeopardising his relationship with Mr. Adams. Both the Greens were asked in cross-examination why they had not said anything along these lines. They did not suggest that they had done so but that it had been left out of the note. Rather, their response was that they were being polite and had not wanted to embarrass Mr. Kirton. I found that unconvincing. Mr. Green senior in particular is very capable of being outspoken; but he could in any event have phrased the point as tactfully as he liked. It is clear from the notes that he took a full part in the consultation, at least as regards the discussion of the factual issues: he did not simply sit back and let the discussion wash over him.
(4) Both notes reveal quite clearly that Mr. Green felt very strongly that he had been badly, indeed dishonestly, treated by Skandia. This is to some extent apparent from the passages which I have quoted, but other parts of the notes contain many more indications of the strength of his feeling, particularly in the form of disobliging comments about individuals: employees of Imagination or Skandia are described as "a bit of a menace", "petty", "drunk with power", and "an idiot", and Skandia generally is described as being affected by a "culture of greed" evidenced by "scandalous bonus structures". Mr. Green made it clear that he believed that Skandia had, and knew that it had, a lot to hide and that he did not believe that it would be willing to go to court. Mr. Dingemans sought to persuade him to see the case in a more cautious light, but he did not appear to have much success: the exchange about the correct reading of Mr. Adams' letter of 16 June 1999, recorded at para. 33 of Mr. Kirton's note, is typical.
- The following day, 6 August 2004, both Mr. Green senior and Andrew spoke to Mr. Keens. Mr. Keens made a note of both conversations. He recorded Mr. Green as commenting that he had found Mr. Dingemans "more negative than he had expected", and he apparently wanted to continue the discussion about the effect of the letter of 16 June 1999. The note then records the following:
Discussion as to obtaining evidence from Adams GPK yet to discuss with TK as to best approach but thought that seeking a meeting in the first instance to sound out RA might be useful. Basic questions:
1. Would RA have thought differently if knew that Skandia had an improved product EP4 (which KG believed was better than Professional Life) which had not been put in front of him for his consideration and possibly deliberately kept from him.
2. Would he have acted any differently if he had known that senior Skandia people involved had a personal financial interest in Professional Life.
Although KG believed that Skandia would not want Adams involved KG still had an existing business relationship with Adams/Imagination and really only wanted him approached as a last resort [my emphasis].
In cross-examination Mr. Green denied that he had said anything to the effect that his existing relationship with Mr. Adams was a reason for not approaching him or that he should only be approached "as a last resort". I do not accept this. I can see no reason and none was suggested why Mr. Keens should have included this in his note if it was not said; nor can I see how there could have been any misunderstanding. What Mr. Green is recorded as saying is consistent with the impression which Mr. Dingemans had plainly had in the consultation (see para. 30 (2) above) and which Mr. Green had not contradicted.
- On 10 August 2004 Andrew sent Mr. Kirton an e-mail giving his impression of the consultation the previous week and enclosing a note dealing with a number of points. He observed that the comments were his own but that he believed that his father's views were "not dissimilar". While he praised Mr. Dingemans in extravagant terms, it is plain that he was disappointed by his apparent caution and did not feel that he had yet fully understood the case (cf. his observations about Mr. Martin referred to at para. 21 above). It is clear that his personal confidence in the strength of the case against Skandia was undented. He did not address the question of an approach to Mr. Adams; but, like his father, he was keen to persuade the lawyers that the letter of 16 June 1999 was not a "Dear John" letter; and in the course of trying to do so he made a number of dismissive observations about Mr. Adams' abilities as a communicator.
- On 13 August 2004 Mr. Kirton wrote to Mr. Green enclosing Mr. Keens' note of the consultation. He summarised a number of areas on which information or instructions were required. The penultimate paragraph of the letter reads: "As a gentle reminder, you must also make a decision on Adams". That "reminder" is only consistent with an understanding on the part of Mr. Kirton that it was for Mr. Green to decide whether he wished Mr. Adams now to be approached; and that understanding can in turn only reflect a belief that he had thitherto been reluctant.
- On 24 August 2004 Mr. Green wrote to Mr. Kirton enclosing further information and also making some observations in the light of the consultation. He attached a very full document entitled "Comments", by reference to a marked-up copy of Mr. Keens' note of the consultation. Although they covered a great deal of ground in some detail, neither the letter nor the comments addressed the question of whether Mr. Adams should be approached for a statement. They do however have some significance for the Adams issue in two respects:
(1) Both the letter and the comments confirm the impression gained from the notes of the consultation that Mr. Green felt extremely strongly about how he believed Skandia had behaved. There was a good deal of ad hominem comment on individuals. He continued to express the view that "the feeling in the industry is that Skandia will not wish these actions to be made public" for fear of repercussions with the Revenue or the Regulator.
(2) Mr. Green was asked in cross-examination why he had not dealt in this letter with Mr. Kirton's "reminder" in his letter of 13 August that he must make a decision about Mr. Adams. He said that he had been on holiday and that he was in any event far too busy to deal with lawyers' letters. It was then pointed out to him that that could not be right because he had written the letter of 24 August. He said that much of that letter had probably been written by Andrew and that, in so far as he had contributed to it, that would have been in the form of a draft done before he went on holiday which Andrew would have worked up into the final letter which he signed on his return. He said that at the point that he signed it he had probably not even seen Mr. Kirton's letter of 13 August. That answer too was plainly incorrect, since the letter of 24 August encloses his comments on the note of the consultation which had only been sent under cover of the letter of 13 August. At that point in his cross-examination he had not been referred to the "Comments" themselves, which were not in the bundle; but they were obtained subsequently and he was asked about them in re-examination. He said at that point that it was probably not him who had written the document: he thought that it was probably written by Andrew and Michael and that he would simply have checked it over. Mr. Sweeting then caused the marked-up copy of the note of the consultation, to which the comments were cross-referred, to be produced. These were elaborately annotated by Mr. Green senior in his own handwriting; and it is clear that the "Comments" are closely based on those annotations. The importance of this sequence of evidence is that it illustrated particularly clearly Mr. Green's willingness to give whatever account of events best suited the particular point that he wished to make; and also his tendency wrongly to suggest that he was not closely involved in decisions relating to the litigation.
- On 26 August 2004 Mr. Kirton wrote to Mr. Green about taking a statement from Mr. Kuhler. On the top of that letter Mr. Green wrote a short note in manuscript in the following terms:
Ray Kuhler mobile 07900 807483
2/9/04 Called MRP. Left message with Geoff Keens secretary to confirm that Ray Kuhler is happy to speak to Solicitors. I am also happy for them to approach Adams [my emphasis]. She will pass on message.
It is Mr. Green's evidence that that is a contemporary note accurately recording a message which he had left with Mr. Keens' secretary. Insofar as it related to Mr. Adams, it was his response to the "gentle reminder" in Mr. Kirton's letter of 13 August. Mr. Sweeting put it to Mr. Green that this note was a forgery that is, that it was written after the event which it purports to record in order to support his case in this litigation. He indignantly denied that allegation. I will return to it in due course.
- On 7 September 2004 Mr. Kirton spoke to Mr. Green on the telephone. His note reads:
Ray Kuhler is happy to speak to us. His phone number is 07900 807483. He indicated that he will be making a further payment on account of fees shortly. He needs to get some sort of estimate of how much it is going to cost to go on. I said I would get back to him.
Mr. Sweeting asked me to note that that conversation is essentially a repetition of the message which, on Mr. Green's case, he had already left about Mr. Kuhler five days earlier. I agree that that is odd; but it must be recalled that the message in question had been left with Mr. Keens' secretary, and it cannot be taken for granted that it would have reached Mr. Kirton by 7 September. It is also curious that Mr. Green did not apparently take the opportunity to repeat the part of the message about approaching Mr. Adams, which was every bit as important as approaching Mr. Kuhler: had he done so, it is inconceivable that Mr. Kirton would not have noted it. But much would depend on the context of the call, which cannot now be reconstructed: if Mr. Kirton had called specifically in order to ask about Mr. Kuhler, who he knew that Mr. Green was intending to contact, it would be less surprising if neither party mentioned Mr. Adams.
- On 9 September 2004 Mr. Kirton wrote to Mr. Green, principally in order to respond to his letter of 24 August. He had not at that point digested the "Comments" document. The response to the letter of 24 August contains nothing relevant to the Adams issue; but it is fair to observe that its tone was calculated to some extent to soften the note of caution which Mr. Dingemans had struck. He agreed that if they were able to "collate substantial information which suggests a conspiracy" this was likely to lead to Skandia coming to the negotiating table.
- There was no approach to Mr. Adams in the period leading up to the second consultation with Mr. Dingemans on 17 March 2005. The reason for this was addressed in Mr. Kirton's Instructions to Counsel dated 22 February 2005. The material part reads:
In fact, matters have not progressed in the manner anticipated by Leading Counsel or Instructing Solicitors. The somewhat delicate position concerning Adams has not been addressed. This is because, at this time, Mr. Green is reluctant to approach Adams although he firmly believes that when approached and given the "full story", he would be "on side". For the purpose of further consideration of these papers, Instructing Solicitors would ask Leading Counsel to assume that the evidence Adams will provide is likely to be supportive of the Claimant's position particularly where the question of conspiracy and EP4 is concerned. Instructing Solicitors accept that this is not the best way of dealing with this matter, but for the moment Leading Counsel is asked to adopt this viewpoint. Following the Consultation, Andrew Green prepared a note of his thoughts which is of some assistance and can be found at item 2 of these Instructions. Counsel will be asked to re-visit this aspect on the next consultation.
(The note by Andrew referred to in the penultimate sentence does not contain any reference to the question of Mr. Adams.) Mr. Kirton gave no evidence before me of any specific communication with Mr. Green which was the basis of his expressed view that he was "reluctant to approach Adams" and the other observations attributed to him. Nor is there any letter or attendance note to this effect. Nevertheless, his instructions to Mr. Dingemans in this regard can only be based on things which Mr. Green had said. It is clear from the written records that they had had a fair number of dealings over the intervening months, and there was every opportunity for the matter to be discussed. Mr. Green denied that he had said anything to this effect. He appeared to suggest under cross-examination that Mr. Kirton had (dishonestly) included this passage in the Instructions in order to excuse himself for his inertia. That is highly implausible. Although it does not appear that a copy of the Instructions was sent to the Greens in advance of the consultation, Mr. Kirton could not have been sure that they would not in due course have been seen by them or that Mr. Dingemans would not have referred to them in the consultation. Nor did Mr. Green suggest any reason why Mr. Kirton should have failed to see Mr. Adams. There is no suggestion that he had been neglecting the case generally rather the reverse: he had, for example, been to see Mr. Kuhler.
- There is, again, a full note of the consultation with Mr. Dingemans on 17 March 2005. It contains these passages:
JD moved on to discuss briefly the issue of causation. What Adams would say was very important and it was important that he be on-side and proofed. He needed to explain his correspondence. JD stated that at present there was a "stunning hole" in that there was no evidence from Adams. Similarly, Adrian Walker needed to be approached and an explanation required of his e-mail regarding EP4. TOK urged KD to now "make the call" to Adams and referred to the initial correspondence when this matter first commenced [my emphases].
Causation
JD stated that he was "amazingly concerned". If the Court concluded that Imagination simply did not want to deal with KG the case would fail. KG would not accept that Adams was against him. It was important that Adams
be approached and a witness statement be obtained before he was approached by the other side [my emphasis]. Eversheds will quickly approach Adams once it was clear to them that the case was in fact proceeding. The leading questions which the other side would put to Adams were:
(1) had he not simply had enough to dealing with KG
(2) did he just not want to achieve simplicity which the transfer to PLAC would achieve ?
If Adams was not helpful it was important to know in a witness statement what he would say.
It was Counsel's "unequivocal advice" that a witness statement or at very least a detailed attendance note be obtained from Adams, otherwise KG was extremely exposed on causation.
JD said that whatever Adams says causation is always going to be a problem in the case.
I would make similar observations about this note to those made at para. 30 above. It must have been quite clear from what they are recorded as having said that both Mr. Dingemans and Mr. Kirton believed that the reason why Mr. Adams had not been approached was that the Greens were reluctant for this to occur: that is particularly clear from Mr. Kirton's reported urging to Mr. Green to "make the call". Mr. Green agreed in cross-examination that, on the basis of his case, he must have been both disappointed that Mr. Adams had not yet been approached and very annoyed that it was being suggested that this was his fault. He was asked why he had not protested. He said, again, that he was "being polite": he did not want to show up Mr. Kirton in front of Mr. Dingemans. I do not regard this as remotely plausible. Even if Mr. Green had had the kinds of scruple which he claims, one would have expected him to have expressed himself in strong terms to Mr. Kirton after the consultation, but it is not suggested that he did so.
- Whatever the obstacle had been to Mr. Adams being approached, it was removed by Mr. Dingemans' firm advice. On 17 March 2005 Mr. Green telephoned Mr. Adams and asked if he would have any objection to speaking to MRP "about a problem I'd been having with Skandia", as it was put in his contemporary note. An appointment was arranged for April. The Greens discussed in some detail the points which they believed should be raised with Mr. Adams, and Andrew sent Mr. Kirton no fewer than three e-mails with suggestions as to the approach to be taken. (I should also mention, because this is relevant to a later issue, that in the course of apologising to Mr. Kirton for presuming to advise him on the approach to be taken Andrew said "I know you are the most brilliant solicitor in the world".)
- Mr. Keens, accompanied by Rebecca Harris, duly went to see Mr. Adams on 13 April 2005. Mr. Adams made it clear from the start that he did not want any note taken in the course of the meeting. However, Mr. Keens and Ms. Harris prepared an attendance note immediately after the meeting had concluded. Mr. Keens gave evidence before me, based largely on the contents of the note. Mr. Adams himself (called by Mr. Green) also gave evidence to me. There is no significant dispute as to what occurred. The meeting lasted about half an hour. Mr. Keens took Mr. Adams through the main points on which it was hoped that he would assist. I need not set out the substance of his answers. It is enough to say that they contained little, if anything, that supported Mr. Green's case. Mr. Adams made it plain that he had decided that he did not want to continue with any commission-based scheme. It was obvious to Mr. Keens and Ms. Harris that he "had
been concerned at the high level of commissions which KG had been earning out of the Scheme". He was not particularly interested to hear about the merits of EP4 and he was not receptive to any suggestion that he had been misled by Skandia. Mr. Keens asked him about the letter of 16 June 1999. He did not accept the description of this as a "goodbye letter". He said, according to the note:
It was rather written out of courtesy in view of KG's long relationship by way of keeping him informed that there may well be a transfer out to Professional Life.
On its face, that answer appears to support Mr. Green's view of the letter as against that of Mr. Dingemans; but I am not sure that in substance it was helpful to him. The note concluded:
RA said he had a good personal relationship with KG and it was because of this and KG's long involvement with the Scheme that he had been prepared to have this meeting with us. He was not however prepared to assist further and to give anymore of his valuable time. He simply did not have the time to go back over all the documents. He was also being placed in a difficult position between KG and Skandia. He did not know what KG's case was against Skandia.
- The impression given by the note is plainly that Mr. Adams would be of no assistance to Mr. Green's case. He was not prepared to become involved at all, let alone make a statement. Even if he had made a statement, his evidence was likely to assist Skandia more than it did Mr. Green. Mr. Keens said in his evidence before me that he regarded what Mr. Adams had said as "his first word, not his last word" that is, as I understood it, that there was a realistic chance that Mr. Adams would in due course have changed his position and been willing to assist after all. While no doubt that possibility could not be excluded, it does not appear on the evidence of the note that it was at all likely; and Mr. Adams so confirmed in his evidence to me.
- The Greens were of course anxious to know the outcome of the meeting with Mr. Adams. Mr. Keens spoke to Andrew the same day or the next. There is no note of that conversation, but on 14 April 2005 he e-mailed Mr. Kirton as follows:
I attach the note which I prepared with Rebecca immediately following our meeting with Richard Adams yesterday. I have spoken to Andrew Green and said that we would be sending the note to Ken.
I told Andrew that there were both positives and negatives coming out of the meeting and that I had not yet had a chance to discuss with you and that you were in Court this morning.
The reference to "both positives and negatives" is frankly surprising. Mr. Keens accepted in cross-examination that there were very few, if any, "positives". He said, however, that he was not sure that he would have used this actual phrase to Andrew: he thought that all that he was intending to convey to Mr. Kirton was that he had told Andrew something neutral pending Mr. Kirton having the opportunity to speak to Mr. Green senior they, after all, being the two principals. He was sure that he would have given Mr. Kirton the basic message that Mr. Adams was not "on side". I see some force in that: quite apart from anything else, Mr. Keens attached the attendance note, from which Mr. Kirton would have well able to seen the position for himself.
- Andrew did not recall the particular conversation referred to in Mr. Keens' e-mail. He said, however, that they did receive an account of the meeting in general terms, which was to the effect that it had gone "fine" and that MRP would be going back to Mr. Adams for a statement. Mr. Green gave similar evidence. He said that he was in Milan on business but that Andrew had had a phone call from Mr. Keens telling him words to the effect of "Adams agrees it was not a 'Dear John' letter and we are going back to him for a statement". He said that he regarded that as good news and that he did not seek any further details. I do not find that evidence credible. Mr. Keens' e-mail and evidence do indeed suggest that he may initially have reported the meeting in more neutral terms than were merited; and he may well also have reported Mr. Adams' position on the letter of 16 June 1999, since this was a point to which Mr. Green was known to attach (rightly or wrongly) particular importance. But I regard it as inconceivable that he would have conveyed the impression that all was well and that MRP would be going back to Mr. Adams for a (sc. favourable) statement. His own attendance note, which he had, according to the e-mail, promised Andrew that he would be sending, made the true position clear; and in any event there was no point in him giving an impression which was bound to be falsified sooner or later probably sooner.
- Despite Mr. Keens' expectation that Mr. Green senior and Mr. Kirton would be speaking, it does not appear that any such conversation took place in the immediate aftermath of the meeting with Mr. Adams. That is a little surprising; but the explanation may be that, as Mr. Green said, he was abroad. A few weeks later, however, Mr. Kirton drafted a letter to Mr. Green dealing with various recent developments, including the meeting with Mr. Adams. What looks like a final draft of that letter, bearing the date 23 May 2005, was disclosed by the Claimants. It contains the following passage:
You are aware that we have met with Richard Adams and we have forwarded a copy of the Attendance Note of that meeting to you. It is clear that he is not going to assist in your claim and we must consider, in due course, how we deal with this in the scheme of the matter progressing towards trial. I am not sure whether Adams would prefer to assist Skandia, but at least we have an idea of what he will say in any event.
- That draft makes it clear that, whatever Mr. Keens may have said or thought, Mr. Kirton at least regarded the outcome of the meeting as substantially negative. It is, however, now accepted by the Claimants that the letter was never sent. Mr. Kirton could not remember why: his only observation was that it appeared from the fact that the draft was in double spacing that it had not been finalised for dispatch, which suggests that the reason was something other than mere administrative oversight. It was not, however, put to him, or suggested to me, that there was some particular reason for the failure which bore on the issues in this case.
- The failure to send the letter of 23 May would have left less of a hole in the advice given to Mr. Green if the attendance note of the meeting with Mr. Adams had been sent to him as Mr. Keens had said in his e-mail that he intended to do, and as Mr. Kirton in the draft letter apparently believed had already occurred ("we have forwarded"). Mr. Keens told me that he thought that he had indeed sent a copy to the Greens. But both Mr. Green senior and Andrew deny that they ever received it. On this point, the probability seems to me to favour the Greens. If the attendance note had been sent, there should have been a covering letter of some kind, however brief; but none has been produced. It is tempting to speculate that the admitted failure to send the draft letter of 23 May and the probable failure to send the attendance note had the same cause, and perhaps that it reflected an unease on the part of Mr. Kirton about how best to break the bad news to the Greens. But that was not put to either Mr. Kirton or Mr. Keens; and it is no doubt equally possible that there is some more mundane explanation, such as that each of them thought that the other would be sending the note.
- There is over the following months no record of any discussion between MRP on the one hand and either of the Greens on the other of what was happening about Mr. Adams or the impact of his position on the prospects in the litigation. In a letter to Mr. Green senior dated 19 July 2005 making some preliminary observations on Skandia's defence Mr Kirton says:
As anticipated in all our conversations this is a matter which will be won or lost on disclosure and the position adopted by Adams.
That tends to convey the impression that there was still uncertainty as to what Mr. Adams might say. That is somewhat surprising in the light of the outcome of the meeting of 13 April. Mr. Kirton was asked about this in cross-examination. He said that he understood that Mr. Green still believed that Mr. Adams, with whom he continued to be in contact and on friendly terms, would come "on side"; and that in that context the reference was acceptable. There was of course also an unresolved question as to whether he would be giving evidence for Skandia.
- The question about Mr. Adams' evidence was next addressed at the consultation with Mr. Dingemans on 21 December 2005. No Instructions for this consultation were put before me, and I understand that none have ever been disclosed. It is therefore unclear what Mr. Dingemans was told about Mr. Adams' attitude prior to the consultation. A note of the consultation was made by Roy George, an assistant solicitor at Manches. The focus of the discussion was on what could be done to improve the prospects of resisting Skandia's application for summary judgment. The discussion as regards Mr. Adams is noted as follows:
What he [Mr. Dingemans] wanted to turn to was the evidence of Adams as he feels that this is also important. He realised that Adams has or had a drink problem and that it was unlikely that he would be able to assist. Ken Green said that Adams is a person who would not help and that he had the view that Ken Green had benefited from earning high commissions, even though there was no substance to it.
James Dingemans said that Instructing Solicitors should take another shot at Adams, particularly on the issue as to whether Skandia had wilfully chosen to exclude Ken Green. The angle could be taken that Skandia had obviously poisoned Adams' mind against Ken Green and that he should now know the reality.
Ken Green said that if Adams was aware that there was still discontent from Imagination [this is a reference to an earlier observation that there was "simmering discontent" about the changes among staff at Imagination] then he would perceive himself to be in trouble.
James Dingemans replies that Adams must support what he said in the pleading in that Skandia had put him up to the transfer and that Skandia were in fact advising him.
James Dingemans said that Instructing Solicitors and Tom Rowe should identify a road plan on how to obtain this evidence
.
- That passage is of course wholly inconsistent with the Greens believing, as they say they had been told in April, that Mr. Adams would be willing and able to give evidence in support of the claim. Mr. Green is quoted in terms as saying that "Adams is a person who would not help"; and Mr. Dingemans' observation about "having another shot" clearly implies that the first attempt was recognised to have been a failure. The obvious explanation is that they had indeed been told the substance of what Mr. Adams had said in the meeting of 13 April, even if they had not been sent the attendance note: in this connection I note that Mr. Green's reference to Mr. Adams believing that he had been earning excessive commissions reflects something which Mr. Adams had indeed said at the meeting (see para. 41 above). (A possible alternative is that they had learnt of Mr. Adams' attitude themselves from direct contact with him, but neither of the Greens suggested this in their evidence.) Mr. Green in cross-examination recognised the inconsistency but met it by flatly denying having said the things attributed to him in the note, observing that "notes are only as good as the people taking them". Andrew likewise, though less emphatically, denied in cross-examination that his father had said what he is recorded as having said: indeed he claimed (though there is nothing about this in his witness statement, and I had the distinct impression of his tale growing in the telling) that he could recall his father having expressed surprise that no statement from Mr. Adams had yet been obtained.
- I am satisfied that the note of the consultation is substantially accurate. If it were not, that could only be the result of deliberate falsification by Mr. George. No reason why he should produce a false note was suggested, and indeed Mr. Prestwich did not even put the supposed falsification (in the absence of Mr. George) to Mr. Kirton. In fact, all the probabilities point to the Greens being well aware of Mr. Adams' attitude long before the consultation, whatever lapses there may have been in formal communication from MRP. If they had really believed that Mr. Adams was willing and able to give a helpful statement it is inconceivable that they would not have pressed to see a statement from him; and even if there had been some initial misunderstanding the true position would inevitably have emerged in the course of their contacts over the intervening months. (I would add that Mr. Dingemans' reference to Mr. Adams having a drink problem can only - whether or not it was true, which in fairness to Mr. Adams I should say that I heard no evidence to support - have originated in something that he or Mr. Kirton had been told by the Greens; and it suggests that Mr. Green senior or Andrew had prior to the consultation been suggesting to Mr. Kirton reasons for Mr. Adams' unwillingness to assist.)
- The question was raised before me whether Mr. Dingemans had ever been sent the attendance note of the conversation with Mr. Adams. It would be surprising if he had not been, but Mr. Sweeting did not, despite some encouragement from me, produce any document from the file (e.g. the Instructions for the consultation on 21 December) showing that he had. It may therefore be the case that he did not in fact ever see the attendance note. If so, that is poor practice, but I do not see how it bears on the essential issues. It is quite apparent from Mr. George's note that Mr. Dingemans had been made aware that Mr. Adams had made clear that he did not wish to assist.
- The day after the consultation, 22 December 2005, Mr. Kirton wrote to Mr. Green raising various issues, including the approach to Mr. Adams which Mr. Dingemans had recommended. He observed that Mr. Adams "may not
assist". That of course is entirely consistent with the terms of the discussion as noted by Mr. George and wholly inconsistent with the Greens' position that they were expecting a helpful statement from Mr. Adams. Mr. Green said in cross-examination that he couldn't remember if he had been surprised by this remark in the letter: it was coming up to Christmas and he was "pretty exhausted". I do not find that a convincing answer.
- On 6 February 2006 Mr. Kirton wrote to Mr. Green again saying:
We do need to decide whether to make an approach to Adams. You have been in contact with him concerning unrelated matters and it seems to me that if he is happy with what you have achieved (and I understand there is no reason for him not to be happy), we should be trying to approach him now. This approach could initially be made through your good self and if he declines to assist then at least we know where we are.
That letter gives rise to essentially the same points as the letter of 22 December; and it also repeats the earlier impression that Mr. Kirton understood Mr. Green to be sensitive about any approaches to Mr. Adams. Instructions to Mr. Roe drafted by Mr. Kirton on the same day say this:
Mr. Green has been working constantly on certain aspects of the Imagination Scheme upon which he is still retained and it is fair to say that he has been unable to "open the door" with Mr. Adams at this moment. This is primarily because of pressure upon Adams in dealing with these matters. It is hoped that further discussion can take place early this week with a view to meeting with Adams if he is inclined so to meet.
Neither of the Greens was able in cross-examination to explain these references. Andrew suggested that the letter of 6 February was an attempt by Mr. Kirton to put the blame on his father for Mr. Adams not having been approached; but he did not suggest and nor did Mr. Prestwich put to Mr. Kirton any reason why Manches should not be happy to go and see Mr. Adams again.
- In the event, Mr. Adams was not approached again. There was thus no statement from him before Mr. Nugee, though in fact as I have already noted - the basis on which the claim was dismissed had nothing to do with the causation point.
CONCLUSIONS
- It is convenient to consider my conclusions on the Adams issue in relation to three distinct periods (1) February-August 2004; (2) September 2004-March 2005; and (3) April 2005-July 2006.
(1) February-August 2004
- Both in his initial letter of 4 February 2004 and subsequently Mr. Kirton put Mr. Green clearly on notice of the importance of ascertaining the position of Mr. Adams. I accept that Mr. Green's note of his conversation with Mr. Kirton on the following day might suggest that he agreed to MRP approaching Mr. Adams and that he left it to them to decide when and how that should be done. But the weight of the other evidence considered at paras. 25-33 above is overwhelmingly to the contrary, namely that the ball was left in Mr. Green's court and that he conveyed to Mr. Kirton that he was reluctant for Mr. Adams to be approached for the time being: of the many indications to this effect, the conversation with Mr. Keens on 6 August 2004 is the clearest. Thus either the note of 5 February is simply inaccurate as to how matters were left (as Mr. Kirton's note of the same conversation suggests) or Mr. Green changed his position subsequently. I think the former is the more likely, but ultimately the question does not matter: what matters is that I have no doubt that the reason why Mr. Adams was not approached during this period is that Mr. Green did not want him to be. I am not entirely sure why he took this attitude. It may indeed be that, as he gave MRP and counsel to understand, he was concerned about jeopardising GD's business relationship with Mr. Adams: Mr. Green said in evidence that his continuing business with Imagination was too insignificant for him to have any such concerns, but that need not necessarily have been how he saw it at the time. However, there are indications from quite an early stage that Mr. Green was in fact uneasy about how helpful Mr. Adams would really be - see paras. 28 and 30 (2) above - and it may be that this too played a part in his reluctance for him to be seen. Such an attitude would of course be irrational; but it is not unknown for litigants to prefer not to confront difficulties in their cases.
- Mr. Prestwich submitted, by way of alternative to his primary case, that if Mr. Green was indeed expressing a reluctance for Mr. Adams to be approached, it was all the more important that he be advised in strong terms that until his position were ascertained he might simply be pouring money into a bucket with a large hole in the bottom. In my view the advice given by MRP, and by counsel at Mr. Kirton's urging, over this period was more than adequate. The letter of 4 February was very clear (and reinforced what Mr. Green had already heard from Mr. Martin). Its contents did not need to be repeated in detail each time Mr. Kirton reminded the Greens, as he did, of the importance of Mr. Adams' evidence. Mr. Green was an experienced professional man, with as he accepted in cross-examination substantial experience of litigation: he was well capable of understanding what he was told.
(2) September 2004 - March 2005
- Mr. Dingemans had on 5 August 2004 repeated in strong terms the advice that it was necessary to obtain a statement from Mr. Adams. Mr. Green's initial reaction was still reluctant: see his conversation with Mr. Keens the following day, saying that Mr. Adams should only be approached "as a last resort". But he says see para. 35 above that on 2 September 2004 he left a message with Mr. Keens' secretary agreeing to an approach to Mr. Adams; and that is apparently recorded in his contemporary note. If that is correct, then it was prima facie a clear breach of duty on the part of MRP not to proceed.
- The entire sequence of events after 2 September 2004 is inconsistent with Mr. Green having given the instructions that he alleges. In the first place, there was a conversation between him and Mr. Kirton on 7 September 2004 about an approach to Mr. Kuhler in which neither party seems to have mentioned the authorisation to approach Mr. Adams communicated only five days previously. I accept that that might by itself be explicable - see para. 36 above but it is much more difficult to understand why, if the authorisation had been given, MRP took no steps to act on it over the following weeks, particularly in view of the pressure which they had been exerting for months to get just such a go-ahead. One possibility might be that Mr. Green's message had simply gone astray it was, after all, only an oral message left with a secretary (and not Mr. Kirton's secretary). But if that were the explanation one would have expected to see some follow-up from Mr. Green: the decision to allow Mr. Adams to be approached had only been taken reluctantly, and it would be surprising if, once it were taken, Mr. Green was willing simply passively to await developments. When this was put to him in cross-examination his only response was that he had been busy and the matter was not his responsibility. I find that unconvincing. If his case is correct Mr. Kirton was behaving in just the way that he and Andrew had found so objectionable in the behaviour of Mr. Farnsworth of Rooks Rider (see para. 21 above): yet they were doing nothing about it. It is also noteworthy that when, following the consultation in March 2005, an approach to Mr. Adams was unquestionably eventually authorised both Mr. Green senior and Andrew took a keen interest in how the approach was to be played: see para. 40 above. There was nothing of that kind here. The omission is all the more striking as there was considerable correspondence from MRP about the approach to Mr. Kuhler which certainly had been authorised. And of course the consultation on 17 March 2005 was conducted on the unchallenged understanding that the reason why Mr. Adams had not been approached was that Mr. Green remained unwilling: see para. 39 above.
- However, the fact remains that Mr. Green's account has the support of his manuscript note of 2 September. If I am to find that the MRP did not have instructions to approach Mr. Adams that can only be on the basis either that the note is indeed a forgery or that some time fairly soon after 2 September Mr. Green reverted to his previous position that he only wanted Mr. Adams approached as a last resort. As to the former possibility, unimpressed as I was by Mr. Green as a witness, he did not strike me as the kind of person who would be guilty of the cold-blooded dishonesty required to commit a forgery of this kind; and although the note remains hard to reconcile with the other evidence it would be a strong thing to find forgery on the basis of circumstantial evidence alone. As to the latter possibility, there is no evidence that Mr. Green ever explicitly cancelled the instruction which he had, on this basis, given on 2 September. But if that instruction had never in fact reached Mr. Kirton which the circumstances suggest was the case no explicit cancellation would have been necessary. It would be enough that in some way or another Mr. Green conveyed to MRP that he remained unwilling for Mr. Adams to be approached for the time being. There is no specific evidence of such communication either; but Mr. Kirton's instructions to Mr. Dingemans for the consultation in March see para. 38 above clearly suggest that Mr. Green had at some point over the recent months confirmed to Mr. Kirton that he did not want Mr. Adams to be approached.
- I cannot pretend that I have found this part of the case easy. Mr. Green's note of 2 September 2004 is, as far as it goes, clear. The contrary evidence is circumstantial and inexplicit. Nevertheless, in my judgment the clear weight of that evidence is against Mr. Green having maintained, if he ever gave, instructions to MRP to approach Mr. Adams during this period. In making that finding I do not ultimately have to find as a fact one or other of the alternative explanations canvassed in para. 61 above, and I do not do so.
- It follows that I find no breach of duty on the part of MRP in the period up to and including the second consultation with Mr. Dingemans. Mr. Prestwich again submitted that, even if the failure to approach Mr. Adams was Mr. Green's decision, MRP were in breach of duty by failing to advise him sufficiently strongly of the need to do so. He submitted that there are indications that Mr. Kirton came during this period to believe that the pursuit of the conspiracy case, as proposed in the first consultation with Mr. Dingemans, afforded an alternative route to victory which made Mr. Adams' evidence less important, if not altogether redundant. I agree that it does appear that following the consultation in August 2004 the focus of Mr. Kirton's energies seems to have been more on the conspiracy case; but that is unsurprising since it had to be developed from scratch. I see no sign that he ever formed the belief which would have been entirely irrational that Mr. Adams' evidence was no longer necessary; and the terms of his Instructions for the March consultation show to the contrary. I do not believe that Mr. Kirton was under a duty to advise Mr. Green more strongly or more often than he in fact did about the importance of approaching Mr. Adams. Mr. Green was, as I have already said, an intelligent professional who took a close interest in the litigation. He had heard Mr. Dingemans' emphatic advice, which confirmed the advice which Mr. Kirton himself had already given. He had been sent the notes of that consultation and been reminded of the point on 13 August. He knew that a good deal of money was being spent in the meantime: he was receiving (and paying) regular bills. No doubt a time would come when it was necessary to repeat the advice; but that is what happened at the consultation in March.
- There is in any event a further point. I am not satisfied on the balance of probabilities that if MRP had approached Mr. Adams in the autumn of 2004 and got as it is reasonable to assume that they would - the same response as they did in April 2005 Mr. Green would have been prepared to cut his losses and abandon the litigation. This important question is in fact barely addressed in his witness statement and, no doubt for that reason, was not really explored in cross-examination; but it is in truth not a matter on which the witness's own evidence would be determinative, and I have to form my own view based on the primary facts found. Mr. Green felt a strong animus against Skandia, by whom he felt that he had been disgracefully treated. He and Andrew were also confident that Skandia would, once it recognised that they were in earnest, settle rather than face an embarrassing trial, particularly if conspiracy which has a pejorative ring to it were alleged. These attitudes were strongly entrenched (see paras. 21, 30 (4) and 32 above). When Mr. Dingemans, as he did in both the first two consultations, sounded a strong note of caution, the reaction of both the Greens was to explain away or misinterpret his observations (as they had apparently done with Mr. Martin's earlier advice: see para. 21 above). Against that background, I think it more likely than not that even an apparently unequivocal refusal by Mr. Adams to assist would not have been treated as the end of the road. They would have continued to harbour hopes that he could be brought round in due course or in any event that he would not assist Skandia either; and they would have hoped that, whatever the difficulties on causation, Skandia's worries about the case would bring it to the negotiating table. Such a course might not have been wise, but it would not have been wholly irrational: large corporate defendants do sometimes settle weak claims for commercial or reputational reasons.
- My conclusion on this point is reinforced by the fact that when Mr. Adams was eventually approached and proved unwilling to assist, the plug was not pulled at that stage: the Greens of course say that that was because they were not given the true picture of his position, but I have rejected that.
- The effect of this finding is that even if Mr. Green had succeeded in establishing breach he would have shown no loss. This is a case in which, the determinative question being what Mr. Green himself would have done, that question falls to be determined on the balance of probabilities rather than on a loss of a chance basis: see Allied Maples Group Ltd. v. Simmons & Simmons [1995] 1 WLR 1602. It follows that the claim would fail in so far as formulated in tort and that even in contract Mr. Green would be entitled only to nominal damages.
(3) April 2005 - July 2006
- Mr. Green's complaint in relation to this period is not of course that MRP had failed to approach Mr. Adams but that they failed to tell him or Andrew of the outcome of that approach. But the effect of my findings at paras. 49-54 above is that while Mr. Keens' initial account to Andrew of the interview may not have been full or accurate, and while MRP did not thereafter communicate formally with Mr. Green senior as ideally they should have done, nevertheless he and/or Andrew were given the essential message that Mr. Adams was unwilling to assist. The Greens can have been in no doubt whatever, from the advice which they had already received, that this was bad news from the point of view of the litigation. Just how bad it was could clearly have to be discussed with counsel in due course. If they had wanted that advice sooner they could have asked for it. I do not therefore believe that there was any breach of duty on the part of MRP.
- Further, if MRP had, contrary to that finding, been in breach in this respect, my conclusions at paras. 64-66 above would apply a fortiori. By April 2005 a great deal of work had been done to develop the conspiracy case, and Amended Particulars of Claim were on the point of being pleaded. Well over £200,000 had already been incurred in costs. If Mr. Green had for the first time learnt at or around that date that Mr. Adams was unwilling to be involved I regard it as very unlikely that he would not have wished to proceed.
Conclusion on the Adams Issue
- I find that neither MRP nor Manches was in breach of duty to the Defendant.
(B) THE PILBROW ISSUE
- There is no disagreement between the parties as to the relevant law. The Court of Appeal held in Pilbrow that if a client instructs a firm of solicitors on the basis that the services which he requires are to be provided by a solicitor and those services are in fact provided by an unqualified person, however competent, the firm has failed to provide the thing contracted for and is not entitled to its fees. It is common ground that in the present case the services supplied by Manches and MRP were provided by Mr. Kirton, who was unqualified: no reliance has been placed by the Claimants on such supervision as may nominally have been exercised over him by Mr. Marshall. Mr. Sweeting did seek to distinguish Pilbrow on the basis that Mr. Kirton's team included qualified solicitors; but I do not believe that that is a sufficient distinction given that the team was clearly working to his direction.
- Accordingly the primary issue before me is whether Mr. Green knew when he first instructed MRP, or learnt at any stage prior to the conclusion of the work for which he was charged by either firm, that Mr. Kirton was not a solicitor. I will start by setting out the parties' respective cases. Without prejudice to the formal burden of proof (which may not be straightforward) I will start with the Defendant.
The Defendant's Case
- It was Mr. Green's case that he made clear to MRP from the start that he wanted the services of a solicitor. He referred in his witness statement to what he said was a contemporary note of his first telephone conversation with Mr. Kirton, on 15 September 2003. This reads as follows:
Spoke to Tony and explained our situation. Our solicitor has disappeared and I am now getting conflicting advice from a partner at Rooks Rider. Scott F said he had dealt with matters but now find that he has not. I am not happy.
I outlined case with Skandia and what they did to Imagination and me. Set out to damage my business.
I said I wanted a solicitor to look at the case to tell us if there is a case. I need an experienced professional opinion. Tony said that I had got his attention. He said that he would be happy to read the file for no charge to see if there was a case.
R/Rider has the files but we had most of the detail which gave an idea. He said to send what we have and he will come back to me. He is going away but like info ASAP. I will get papers to him today.
Monday Lorna to arrange courier. Send papers originally sent to David Rosling.
- In cross-examination Mr. Green accepted that Mr. Kirton did not in the conversation there recorded claim as such to be "an expert professional", still less a solicitor; but he said that he assumed that that was what he was, because he had made clear what he wanted and when Mr. Kirton said that he would take the case he must be taken to have accepted it on that basis. Mr. Sweeting did not put to Mr. Green that the note was not genuine or that Mr. Green did not use the word "solicitor" (Mr. Kirton, unsurprisingly, had no specific recollection of the conversation); and I must accept that he did. I should, however, make clear that I do not believe that Mr. Green was in this conversation making the point to Mr. Kirton that he wanted the services of a solicitor as opposed to an "experienced professional" who was not a solicitor (whether an experienced managing clerk/legal executive or indeed an employed barrister). There is nothing in the note or Mr. Green's oral evidence to that effect: indeed I doubt whether the possibility that an "experienced professional" lawyer in a firm of solicitors could be anything other than a solicitor occurred to him. This finding may not strictly speaking, mean that he is not to be treated as having contracted for the services of a solicitor and in any event matters moved on subsequently (see para. 74 below); but it is relevant to other factual issues which I shall have to decide.
- Mr. Prestwich also referred to the terms of the retainer letter which Mr. Kirton on behalf of MRP wrote to Mr. Green on 20 October 2003. The material parts of the letter are as follows:
Dear Ken,
Skandia Life
We will be delighted to act on behalf of you and Green Denman in connection with Skandia. I am writing to confirm your instructions and how we will approach this matter.
I enclose for your information a memorandum which sets out the standard terms upon which work is undertaken by my firm
In accordance with the standard terms, I confirm that I will be the partner responsible for the matter and that I will personally have day to day conduct of it. I will be working with Geoffrey Keens one of our consultants.
In describing Mr. Kirton as a partner in MRP the letter must, objectively, be taken to state that he was a solicitor. Mr. Kirton explained in evidence and Mr. Prestwich in his closing submissions accepted - that the use of a letter in those terms was a mistake and that it was not intended to mislead. (It can in fact be seen from other language in the letter, which I need not set out, that the secretary had wrongly used the template for a retainer letter in transactional work - for which a partner would have been responsible.) Mr. Kirton accepted that he had been careless in not spotting the error. It is right, however, that I should note that Mr. Prestwich did not in his skeleton argument or closing submissions suggest that Mr. Green had been positively misled by the terms of the letter. That reflects the approach in Mr. Green's witness statement, which puts his case on this aspect squarely on the terms of his initial conversation with Mr. Kirton in September and does not refer to the retainer letter at all. (It is fair to say that Andrew does refer, briefly, to the retainer letter in his witness statement, but only by way of argument rather than evidence.)
- It was Mr. Green's case that it remained his understanding, and Andrew's, throughout the period to which the fees relate that Mr. Kirton was indeed a solicitor. He points out Andrew's use of the term "solicitor" (without correction from Mr. Kirton) in the e-mail referred to at para. 40 above. It was only when, after Mr. Nugee had given judgment, counsel for Skandia in the course of submissions about costs referred to Mr. Kirton not being "admitted" that they began to ask questions. It was Andrew's evidence that in August 2006 he asked someone at the Law Society what "not admitted" meant and was told that it meant "not a solicitor". It was only then that they understood the true position.
- Mr. Sweeting took Andrew Green in cross-examination to the terms of the letter to Manches of 2 September 2006 raising a formal complaint (see para. 16 above). The letter mentioned the fact that Mr. Kirton was "not
even an admitted solicitor" but it did so only by way of comment on the level of the fees and made no complaint that this was a fact which had been concealed from the Greens until then. Andrew said that they had not at that point taken advice and were unaware of the Pilbrow point. I accept that that is likely to have been the case; but I see force in Mr. Sweeting's contentious that, irrespective of any legal issue, if the Greens had felt that they had been misled on an important point of this kind they would have been likely to say so. Mr. Sweeting also pointed out that no complaint on this point was made when the Greens' new solicitors first wrote to Manches. (Mr. Sweeting also referred to the wording of an e-mail to Mr. Kirton of 21 July 2006 raising various queries about the order for costs: the e-mail is in the name of Mr. Green senior but it seems that Andrew had a major hand in its drafting. However, the points he made by reference to it seem to me inconclusive.)
- Mr. Sweeting pointed out to Mr. Green in cross-examination that at the foot of MRP's writing-paper, on which he had received a very large number of letters between September 2003 and November 2005, Mr. Kirton is listed as a "senior associate" with an asterisk indicating "not admitted". Mr. Green said that he had paid no attention to that. Mr. Sweeting submitted to me that that was an implausible answer and that the reason that neither of the Greens had raised any query was that they had indeed had the position explained to them. There is something in that submission, but if it stood alone I would not give it much weight. Not everyone is as interested as lawyers in the minutiae of status. For the same reason, if which I think is likely, despite their evidence to the contrary the Greens received Mr. Kirton's business card and the firm's brochure (see para. 78 below), I would not be very surprised if they failed to appreciate the significance of the way that Mr. Kirton was there described. Mr. Sweeting did not submit and I would not have accepted the submission if he had that the mere use of the opaque phrase "not admitted" on standard stationery was sufficient to bring home to a client who is not a lawyer that a person who he had otherwise been led to understand was a solicitor was not in fact qualified as one.
The Claimants' Case
- At para. 13 of his witness statement Mr. Kirton referred to his first meeting with the Greens on 4 March 2004. He said that he would on that occasion have given them his business card and the firm's brochure (both of which used the phrase "not admitted"). He continued:
This was a practice I adopted without fail during my time at MRP whenever I met a new or potential new client. I would always give all new clients a more or less standard introduction to MRP's services
and an explanation of my position within the firm. I would explain that I was a senior associate and that the fact that I was "not admitted" meant that I was not a qualified solicitor. I described my position as analogous to an old-style managing clerk of a law firm.
In crossexamination he accepted that it was unlikely that he would have said anything to the same effect during his telephone conversation with Mr. Green in September 2003; and he also accepted that he had no specific recollection of giving him and Andrew his "standard" explanation on 4 March 2004. But he insisted that he was sure that he did so because it was his invariable practice. At one stage he appeared, in answer to a question from me, to say that he would only give the explanation if the question of his status came up (though he said that it always would come up sooner or later); but when I suggested that that was inconsistent with the passage from his witness statement which I have set out he said that he would certainly have given the explanation in the context of giving out his business card. Both the Greens denied in cross-examination that they had ever been given such an explanation, or indeed that they had been given the business card and brochure.
- There was no independent evidence directly supporting Mr. Kirton's account. Mr. Keens was present at the meeting on 4 March 2004 but, unsurprisingly, he did not claim to have any recollection of it. However, he did give evidence that on many occasions he had heard Mr. Kirton explain to clients his position as an unadmitted litigator in the terms set out at para. 13 of his witness statement. Mr. Keens was not challenged on that evidence, and I accept it. He went on to say that he was very surprised that Mr. Green should now be saying that he believed throughout that Mr. Kirton was a solicitor. His witness statement says "my definite view is that from the outset he knew that this was not the case". While that statement is entirely general and is not based on any specific evidence, I do not believe that it should be wholly discounted on that account. Mr. Keens was involved with Mr. Kirton and the Greens for the best part of two years and was well-placed to form a view on the probabilities. Mr. Keens did not join Manches in November 2005 and thus no longer has any involvement with the parties. He struck me as a fair and independent witness.
- It was also Mr. Kirton's evidence that the fact that he was not a solicitor came up in conversation with Mr. Green senior on other occasions. At para. 14 of his witness statement he said this:
I had detailed conversations with Mr. Green as to my background whilst at the Greens home which I visited in both July 2004 and December 2004 along with other members of the team from MRP in order to work through various documents. Mr. Green was always very friendly and chatty. He was interested in me and the rest of the team and asked several questions about how we became involved in the law. I distinctly remember telling him that I began my career as an office junior at Le Brasseur and Oakley and had progressed to my position without qualifying as a solicitor or obtaining a law degree. I was and am proud of my background and of what I have achieved without any formal legal qualifications and told Mr Green so. The Greens did not make any complaint or voice any concern over my experience and/or qualifications whatsoever throughout the retainer.
He maintained this evidence in cross-examination. If it is true, it would not as such alter the basis on which the parties had originally contracted nor, therefore, be an answer to Mr. Green's Pilbrow claim for the repayment of bills for work done in the preceding period; but it would found a waiver for the future.
- When that account was put to Mr. Green he was vehement in his denial, describing it as "absolutely ridiculous" and "rubbish". He said, repeating a leitmotiv of his evidence, that he was "busy all the time" and that on Mr. Kirton's visits which were essentially to examine documents - he saw him and Ms. Harris only briefly "at elevenses and lunchtime". He said that he was not in the least interested in hearing about Mr. Kirton's background or experience. He had not been specially impressed by Mr. Kirton's abilities: he thought he went in for too much "self-praise", which "rang warning bells". If anything, he said, it was Mr. Kirton who was inquisitive about his background He said that if Mr. Kirton had told him that he was not admitted as a solicitor "I'd have chucked him out of the door: I wouldn't have had anything to do with him". I found both the manner and the circumstantiality of that denial histrionic and unconvincing. Among other things, his comments about Mr. Kirton's abilities have the ring of hindsight: there is undisputed evidence that he employed him for other work during this period. I defer for the present an overall assessment of the credibility of the witnesses' respective evidence on the Pilbrow issue, but I should say at this stage that I do not find Mr. Kirton's account in any way unlikely: even if he and Mr. Green had only met at mealtimes, the kind of conversation he describes is entirely plausible.
- The Claimants also adduced evidence from a Ms. Frances Reed, who is employed by Manches and had previously been Mr. Kirton's secretary there and at MRP. She gave evidence that she remembered an incident when Mr. Green senior had visited Mr. Kirton at MRP and that while she had been taking him up in the lift he had described Mr. Kirton as (according to her witness statement) "the best litigator that he had ever had, despite the fact that he was not qualified". But in an effective cross-examination Mr. Prestwich was able to point to a number of inconsistencies about her evidence. I do not believe that she was lying, but I think it very possible that she was confusing Mr. Kirton with another client; and I think it right to attach no weight to her evidence.
Discussion and Conclusion on the Pilbrow Issue
- If Mr. Kirton had taken proper care over the terms of the retainer letter, the issue about whether Mr. Green was told about his status would not have arisen: Mr. Green would have been clearly put on notice of the position and would either have accepted or rejected it. I have considered carefully whether I ought to treat the terms of the letter as a definitive statement of the terms of the retainer in this regard. It might at first sight seem attractive to do so. The point of a retainer (or client care) letter is that both parties should have an authoritative statement of the basis on which the solicitor is acting; and once such a letter (drafted, be it noted, by the solicitor) is signed there is a lot to be said for its being conclusive unless and until replaced by an equivalently formal document. But Mr. Prestwich did not in fact put the case that high, and on reflection I think he was right not to do so. In the case of other written contracts, their terms can be varied, or a waiver or estoppel can arise, as a result of oral agreement or of conduct, and I can see no principled reason why a solicitor's retainer should be different. If I were in truth satisfied that before the work in question was done it was made clear to Mr. Green, albeit informally, that the person doing it was not a solicitor, and he made no demur, he ought not in justice to be permitted to raise the point later as a reason for not paying his bills. The burden of showing that that was so must of course be on the Claimants. In this connection I have also had regard to the observations of Denning LJ in Griffiths v. Evans [1953] 1 WLR 1424 to which Mr. Prestwich referred me (though initially for another purpose). At p. 1428 he said this:
On this question of retainer, I would observe that where there is a difference between a solicitor and his client upon it, the courts have said, for the last 100 years or more, that the word of the client is to be preferred to the word of the solicitor, or, at any rate, more weight is to be given to it (see Crossley v. Crowther (1854) 9 Hare 384, per Turner V.-C., and Re Paine (1912) 28 TLR 201, per Warrington J.). The reason is plain. It is because the client is ignorant and the solicitor is, or should be, learned. If the solicitor does not take the precaution of getting a written retainer, he has only himself to thank for being at variance with his client over it and must take the consequences.
I do not read that as propounding a rule of law that the word of the client must always be preferred, but there is obvious justice in the proposition that in applying the (flexible) civil standard of proof I should take into account the fact that the primary responsibility for spelling out the terms of the retainer must be on the solicitor.
- It follows that the crucial question for me is whether I am satisfied that at the meeting on 4 March 2004 Mr. Kirton did indeed give his "standard" explanation. If he did, that would supersede Mr. Green's initial request in September 2003 for "a solicitor". I have come to the conclusion that Mr. Kirton did indeed give that explanation. My reasons can be summarised as follows:
(1) I accept Mr. Kirton's evidence that it was his standard practice to give such an explanation. I have no reason to doubt the truthfulness of his statement to that effect, and I can see good reasons why he should have had such a practice. His statement is of course supported by the evidence of Mr. Keens, who I regard as a truthful witness. Of course, people do sometimes depart from their normal practices, but I see no special reason why he should have done so on this occasion.
(2) In contrast to his position as regards the meeting on 4 March 2004, Mr. Kirton did claim to have a specific recollection about his conversation with Mr. Green in Sussex: see para. 80 above. I have no reason to doubt the truth of this evidence, whereas, as I have said, I found Mr. Green's denials unconvincing. If such a conversation occurred and, as Mr. Kirton says, Mr. Green expressed no surprise or objection, that tends to support the view that he was already aware of Mr. Kirton's status.
(3) For the reasons which I have already given, I do not regard either Mr. Green senior or Andrew as reliable witnesses, and I cannot attach significant weight to their denials. I do not regard Andrew's use of the term "solicitor" on one occasion as inconsistent with his having been told that Mr. Kirton was not admitted. If he and his father were happy with the position, the facts about Mr. Kirton's status are not likely to have remained at the forefront of his mind, and "solicitor" would be no more than a loose synonym for "lawyer".
(4) I can see nothing implausible in Mr. Green being content to accept Mr. Kirton's services on the basis that he was not a solicitor. It is not uncommon though admittedly the practice is declining for experienced legal executives or managing clerks to have the conduct even of quite major litigation; and, whether or not Mr. Green knew that, if Mr. Kirton was regarded by MRP as competent to handle a case of this kind I do not see why he would necessarily have questioned it. The position would be a fortiori if Mr. Lunn, who recommended MRP, had recommended Mr. Kirton by name. Mr. Kirton's unchallenged evidence was that MRP's work for Mr. Lunn had been mostly handled by him; and in those circumstances it would be surprising if Mr. Lunn had not indeed recommended him individually. Mr. Green says however that Mr. Lunn had spoken to his wife rather than to him and that, at any rate as transmitted to him, the recommendation was only of MRP as a firm. I am bound to say that I find that rather unlikely and that Mr. Green's evidence on the point had the ring of being tailored to meet this very objection.
(5) The Greens' failure to complain in their letter of 2 September 2006 and their subsequent letter before action that they had been misled about Mr. Kirton's status (see para. 76 above) is in my view a point of real weight, albeit not decisive by itself.
(6) The Claimants' case also gains, some albeit, modest further support from (a) the Greens' failure to query the phrase 'not admitted' on MRP's stationery (see para. 77 above) and (b) the evidence of Mr. Keens referred to at para. 79.
Taking all those factors together, I am satisfied that Mr. Kirton gave the explanation that he claims; and Mr. Green's case based on the Pilbrow point accordingly fails.
- It does not follow from this conclusion that either Mr. Green or Andrew was consciously lying in their evidence to me, and that is not the impression that I formed. They - and Mr. Green senior in particular - were clearly badly shaken by the dismissal of their claim by Mr. Nugee. They had already incurred very large costs in the expectation (however optimistic) that they would in due course be recouped from Skandia; and they were also now liable for much of Skandia's costs. They were looking for a way out and for someone to blame. In that frame of mind, it was not difficult to convince themselves and certainly once they became aware of the Pilbrow case - that they had been misled about Mr. Kirton's status: memories can very easy slur over the facts in such circumstances.
- I should also record my finding on one issue which might arise if, contrary to my conclusion above, the Greens were not told or not in any way which had legal effect that Mr. Kirton was not a solicitor. On that basis Manches' claim would fail; but on Mr. Green's counterclaim the issue might arise of what he would have done if he had known the true position. If I had to decide that issue, I would hold that Mr. Green would have continued to instruct MRP (and Manches) in any event. I do not believe that he would have attached decisive significance to Mr. Kirton's status. Mr. Green's original request for a "solicitor" was not (see para. 73 above) an indication that he was opposed in principle to having work done by an unqualified litigator: the essence of his requirement was that he wanted, in his own words, "an experienced professional". Mr. Kirton was both experienced and, save in the most narrowly technical sense, a professional. The signs are that from the start both the Greens liked Mr. Kirton and thought he was on their side and would do a good job; and that seems to have remained the position for most if not all of the period until the defeat before Mr. Nugee. If they were troubled at all and wanted reassurance, Mr. Kirton was genuinely in a position to demonstrate his very long experience as a litigator, and Mr. Lunn would have confirmed that he was satisfied with his work. Mr. Keens, himself an experienced solicitor, was a member of the team.
(C) SEC. 69 (2) OF THE SOLICITORS ACT
- I can deal with this point shortly. The signature on many or all of the bills on which Manches sue is illegible. It is of course a statutory requirement that all solicitors' bills should be signed by a partner. Mr. Prestwich, encouraged by the superficial similarity of at least some of the signatures in question to Mr. Kirton's signature, put Manches to proof that each of them had indeed been signed by a partner in the firm rather than by Mr. Kirton. Mr. Zietman, for Manches, Head of Commercial Litigation and Arbitration, gave evidence before me and confirmed that that was the case. In most cases he was able specifically to identify the signatory, but even where he could not I am satisfied that under the firm's procedures it is extremely unlikely that a non-partner would have been asked to sign a bill or would have done so. Mr. Kirton confirmed that none of the signatures was his. I am satisfied that all the bills in question were signed by a partner.
CONCLUSION
- The Claimants are entitled to judgment on the bills identified in the Particulars of Claim, subject to the outcome of the assessment already ordered. The Defendant's counterclaims against both Manches and the former partners in MRP are dismissed.
- Nothing in this judgment should be taken as expressing any view on the merits of the criticisms of the work of MRP and Manches which may be made on the assessment. I can understand why the Greens were dismayed at the size of the bills which accrued in connection with the Skandia litigation, particularly if (as I am told) they far exceeded the estimates given. But I am not in a position to make even a provisional judgment as to whether those bills were indeed excessive or whether any departure from the estimate was justifiable. All that I can say is that the battlefields which the Greens have so far chosen in an effort to avoid or mitigate their liability were the wrong ones.
