Concurrent Proceedings are not Inherently Unfair

In R (on the application of Land & Ors) v Executive Council of the Joint†Disciplinary Scheme [2002] EWHC 2086 the Administrative Court†considered whether the existence of concurrent proceedings gives rise†to an inherent unfairness that the court should take into account when†determining an application for a stay of disciplinary proceedings.

An application was made by Ernst & Young†(E&Y) seeking an order staying the†investigation by the Executive Council of the†Joint Disciplinary Scheme (JDS) into E&Y's†role as auditor of Equitable Life Assurance†Society and subsidiaries (Equitable) until†after the completion of civil proceedings†brought by Equitable against E&Y. The†application was made on the ground that the†continuation of the investigation would give†rise to a serious risk of prejudice to E&Y.†The prejudice alleged was in relation to the†litigation, the JDS investigation and any†subsequent disciplinary tribunal proceedings,†and the private and professional lives of the†E&Y partners and personnel who were†involved in the firm's audits and regulatory†work for Equitable.

Mr Justice Stanley Burton referred to the†general principles applicable to an†application for a stay of regulatory†proceedings, which were set out by Dyson J†in R v Executive Council of the JDS, ex parte†Hipps (1996 New Law Transcript†296069202). He noted that one of the†factors to be considered by the court was†that unless a party seeking a stay can show†that there is a real risk of serious prejudice†which may lead to injustice in one or both†sets of proceedings, a stay must be†refused. E&Y sought to argue that one of the†factors relevant to the issue of prejudice†was that there was an inherent unfairness in†two tribunals concurrently considering the†same issue.†

This issue was the subject of conflicting†opinion. In R v ICAEW, ex parte Brindle†[1994] BCC 297, the Court of Appeal held†that concurrent proceedings should be†regarded as inherently unfair. By contrast,†the Divisional Court in R v Chance, ex parte†Smith [1995] BCC 1,095 did not consider†that Brindle had laid down a general†proposition and considered that it had been†determined on its facts.

†Stanley Burton J said that, looking at the†issue at a general level, he preferred the†approach of the Divisional Court in Smith.†He observed that "[r]egulatory investigations†and disciplinary proceedings perform†important functions in our society" and that†the proceedings of disciplinary tribunals†should no longer be...