Julia Mazur & Ors v Charles Russell Speechlys LLP
Neutral Citation Number[2025] EWHC 2341 (KB)
A recent judgment regarding an appeal by Julia Mazur and Jerome Stuart against a decision to lift a stay on proceedings involving their former law firm, Charles Russell Speechlys LLP, concerning a debt recovery case.
Appeal Background and Context
The case involved an appeal by Julia Mazur and Jerome Stuart against a decision regarding the conduct of litigation by an employee of a law firm.
- The appellants challenged a costs order of £10,653 made against them.
- The respondent, Charles Russell Speechlys LLP, was owed £54,263.50 for legal work.
- Goldsmith Bowers Solicitors (GBS) was instructed to recover the debt, leading to a claim and counterclaim.
- The appellants argued that Peter Middleton, who conducted litigation against them, lacked a current practicing certificate.
Legal Proceedings and Initial Rulings
The initial ruling involved a stay of proceedings due to concerns about the qualifications of the individual conducting litigation.
- Deputy District Judge Campbell ordered a stay, citing evidence of Mr. Middleton’s unauthorised involvement in reserved activities.
- The stay required a partner’s statement from GBS to lift it, which was later complied with after Mr. Middleton was replaced by a qualified solicitor.
- His Honour Judge Simpkiss lifted the stay and allowed the respondent to amend its claim.
Key Legal Arguments and Findings
The appeal centred on whether Mr. Middleton was authorised to conduct litigation under supervision and the implications of the Legal Services Act 2007.
- The appellants argued that the Legal Services Act did not permit unauthorised individuals to conduct litigation, even under supervision.
- The respondent contended that Mr. Middleton was authorised due to his employment with a regulated firm and the SRA’s confirmation.
- The judge’s ruling relied on the SRA’s letter, which stated Mr. Middleton had authority to conduct litigation under supervision.
Representations from Regulatory Bodies
The Law Society and Solicitors Regulation Authority provided insights on the legal framework regarding unauthorised individuals conducting litigation.
- The Law Society stated that non-authorised individuals can support authorised solicitors but cannot conduct litigation themselves. (Emphasis added).
- The SRA confirmed that only authorised individuals can engage in reserved legal activities, emphasising the importance of public confidence in legal services.
- Both bodies clarified that the employer’s authorisation did not extend to employees who are not individually authorised.
Court’s Conclusion on Mr. Middleton’s Authority
The court ultimately concluded that Mr. Middleton was not entitled to conduct litigation under supervision, marking a significant legal finding.
- The learned judge’s reliance on the SRA’s letter was deemed an error of law.
- The court emphasised that the conduct of litigation was a reserved activity that required individual authorisation.
- The ruling reinforces the principle that only authorised individuals can take responsibility for litigation, ensuring compliance with the Legal Services Act.
Legal Framework for Conducting Litigation
The Legal Services Act (LSA) outlined the regulations governing who can conduct litigation in England and Wales.
- Section 12 defines “reserved legal activity” to include the conduct of litigation.
- Conduct of litigation includes issuing proceedings, prosecuting, defending, and performing ancillary functions.
- Section 13 specifies that entitlement to conduct reserved legal activities is determined solely by the LSA.
- A person must be an “authorised person” or an “exempt person” to conduct litigation.
Employee Entitlement Under LSA
Employees cannot conduct litigation solely based on their employment with an authorised person.
- Mere employment does not grant the right to conduct litigation, even under supervision.
- Sections 15 and 16 clarify that employees are treated separately from their employers regarding entitlement.
- If an employee conducts litigation without entitlement, both the employee and employer can commit an offence.
Definition of Authorised and Exempt Persons
The LSA defines who qualifies as an “authorised person” and an “exempt person.”
- An “authorised person” is someone authorised by a relevant approved regulator, such as the SRA.
- An “exempt person” may conduct litigation if granted rights by a court or under specific enactments.
Regulatory Arrangements and Compliance
The LSA establishes regulatory arrangements for those authorized to conduct reserved legal activities.
- Section 21 outlines the regulatory framework, including practice, conduct, and discipline rules.
- “Regulated persons” include those authorised and their employees, but this does not extend the definition of who can conduct litigation.
Court’s Ruling on Costs
The court found errors in the previous judge’s cost award against the Appellants.
- The learned judge incorrectly concluded that the Appellants lost on a point under the LSA.
- The awarded costs of £10,653 exceeded the permissible amount for Intermediate Track cases.
- The court varied the order to “no order as to costs,” reflecting the justice of the matter.
Other Relief and Future Actions
The court declined to refer individuals for further investigation or strike out the Respondent’s claim.
- The SRA is to decide on further steps after this judgment.
- The claim was rectified by adding a qualified solicitor’s signature, mitigating potential prejudice to the Respondent.