Judge Kerr: Mr Shah was “involved in management” of law firm
The Law Society has obtained a groundbreaking injunction that prevents a struck-off solicitor from holding himself out as a solicitor or being involved in a law firm without its approval.
Dixit Shah was involved in one of the profession’s most notorious law firm interventions – described at the time by the society as “the legal equivalent of the Great Train Robbery”.
He was now accused of involvement in a north London law firm despite having been struck off.
In Law Society v Shah [2014] EWHC 4382 (Ch), the High Court had to decide whether the Law Society – through the Solicitors Regulation Authority and akin to acting as a private attorney general – had the power to seek a permanent injunction to prevent Mr Shah from holding himself out as a solicitor, undertaking reserved legal activities or being employed by, managing or controlling the practice of a solicitor.
From 1998 to 2000, Mr Shah ran the Brandon group of firms, where the society alleges he misappropriated about £8m of client funds – an allegation which Mr Shah denies.
The Law Society intervened in Brandons in 2000, and the compensation fund has since paid out over £12m to former clients.
Mr Shah, who at the time had moved to India and by accounts at the time was trying to start a Bollywood career, was struck off in 2002 for having employed a solicitor who he knew was suspended from practice.
Mr Shah was made bankrupt for a second time in 2002, on a petition of the Law Society, as a result of unpaid intervention and legal costs of almost £865,000.
Mr Shah was arrested in 2009 and the following year pleaded guilty to conspiracy to defraud, based on a series of mortgage transactions with a total loan value of over £3m – although the actual loss to the victims was £360,500. He was released from prison in 2012.
As well as the injunction, the society applied for an order for Mr Shah to swear an affidavit, setting out his dealings with any solicitors since 2013, and in particular with Doe Fosuhene and her firm Trinity & Co, based in Wembley. The SRA closed Trinity & Co last year.
The Law Society further applied for an order that it could take any steps necessary to publicise the court’s order, including publishing a warning notice with Mr Shah’s photograph attached.
Mr Shah argued that the that this would violate his “human rights and natural justice”. Tim Kerr QC, sitting as a deputy judge of the High Court, said Mr Shah “likened the application to one by a suspicious wife who suspects her husband of philandering and seeks an injunction to prevent him committing the crime of bigamy, an injunction the court would refuse as unnecessary”.
But Tim Dutton QC, counsel for the society, argued that there was evidence that Mr Shah was “closely involved” in the management of Trinity & Co.
Delivering judgment, Judge Kerr said he was satisfied that there was evidence that Mr Shah, although struck off, was “involved in the management of Trinity without SRA approval”.
The judge said he was also satisfied that, unless restrained, “there is a real danger that he may engage in activities that would either involve the commission of criminal acts by him, or breaches of the regulatory regime by others”.
Judge Kerr held that the Law Society was entitled to obtain the relief it sought under section 41(4) of the Solicitors Act 1974, which enables the High Court, where a solicitor employs or remunerates a solicitor who has been struck off, to strike off or suspend that solicitor or “make such other order in the matter as it thinks fit”.
The judge granted the Law Society’s application for a permanent injunction, for an order requiring Mr Shah to provide a further affidavit and for publicity.
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