UK: Supreme Court Considers Double Jeopardy In Professional Disciplinary Proceedings

Last Updated: 25 March 2011
Article by James Roberts and Germaine Gillen

The professional indemnity market will welcome the recent decision of the Supreme Court in R (on the application of Coke-Wallis) v ICAEW, in which the Law Lords upheld the principle of res judicata and prevented the ICAEW, the accountants regulator, from bringing disciplinary proceedings twice in relation to the same misconduct by an accountant. This was after the ICAEW had failed to successfully bring charges the first time because of a procedural error.

Although the case concerned the activities of an accountant and his regulator, it is of general interest and significance for all the professions, especially in the current climate of increased regulatory attention and pressure.

Of particular interest, are the Lords' comments on the public interest in the efficacy of the regulator's disciplinary function. Lord Clarke expressly said that he saw the force in principle of introducing a public interest exception to the res judicata rule in disciplinary cases such as these, but recognised that it was a matter for Parliament to legislate. Lord Collins also expressed displeasure at the "thoroughly undesirable result ... for purely technical and unmeritorious reasons ... the effect of the decision of this court is that a person who has shown by his discreditable conduct that he is not fit to practise may continue to do so. The primary purpose of disciplinary proceedings is not to punish, but to protect the public, to maintain public confidence in the integrity of the profession, and to uphold proper standards of behaviour".


Mr Coke-Wallis, a chartered accountant in Jersey and a member of the Institute of Chartered Accountants in England and Wales (ICAEW), applied for judicial review of a decision by the ICAEW Investigation Committee to "prefer" (bring) a second disciplinary complaint against him. The second complaint arose from the same conduct, which had resulted in criminal proceedings against him in Jersey, as the first complaint, which had been dismissed by the disciplinary tribunal.

Mr Coke-Wallis carried out regulated financial services work through a number of trust companies in Jersey. In 2002 the Jersey Financial Services Commission issued a direction that no records or files in respect of his companies or customers should be removed from the companies' offices and that the companies should cease to trade. However, Mr Coke-Wallis was found at the St Helier ferry terminal with customers' documents in his car, and subsequently convicted in Jersey of failing to comply with the direction.

The first complaint

In 2004, the ICAEW preferred its first complaint against Mr Coke-Wallis, relying on the fact of his criminal conviction (rather than reference to the underlying conduct). The disciplinary tribunal found that the conviction did not correspond to an indictable offence in England and Wales and was not therefore conclusive proof of "any act or default likely to bring discredit on himself, the Institute or the profession of accountancy" under the relevant bye-law. It therefore dismissed the complaint.

The second complaint

The ICAEW then preferred a second complaint, arguing that the first complaint had been brought on the basis of the conviction, whilst the second complaint was being brought on the basis of Mr Coke- Wallis' underlying conduct. Mr Coke-Wallis complained that the two complaints made the same allegations, and applied to dismiss or stay the second complaint on the grounds of autrefois acquit and res judicata (ie, that no one should be vexed twice in respect of one and the same cause) or on the basis of abuse of process. A differently constituted disciplinary tribunal rejected the application and Mr Coke-Wallis sought judicial review. In the meantime, the second complaint was heard and Mr Coke-Wallis was ordered to be excluded from membership of the ICAEW and a costs order was made against him. These sanctions were stayed pending the outcome of the judicial review proceedings.

Supreme Court ruling

At first instance the High Court dismissed the application, and the Court of Appeal dismissed the subsequent appeal. However, the Supreme Court has now unanimously allowed the appeal, with Lord Clarke giving the leading judgment.

Lord Clarke considered the appeal under the doctrine of res judicata, on the basis that the first complaint gave rise to a cause of action estoppel (ie, that a party cannot assert a cause of action against another party where the non-existence of the cause of action has already been determined by a court of competent jurisdiction in previous litigation between the same parties). He considered that the principle applied to disciplinary proceedings of this kind and that the two complaints were based on the same grounds, namely the failure to comply with the direction of the Jersey Financial Services Commission. A fair reading of the first complaint was that the ICAEW sought to rely on the conviction as conclusive evidence of the underlying breach, not that it relied on the conviction itself as a breach. Lord Clarke went on to find that the tribunal's first decision was both final and on the merits and thus all the constituent elements of cause of action estoppel were established.

The Supreme Court held that the appeal should be allowed, with the result that the second tribunal's decision to exclude Mr Coke-Wallis from membership of the ICAEW could not stand. Lord Collins commented that "it is unfortunate that the Institute's procedural error should have had such farreaching (and absurd) consequences". Lord Clarke saw force in the creation of a public interest exception to the strict application of the doctrine of cause of action estoppel but noted this was a matter for Parliament to legislate upon rather than the courts.

Lord Clarke and Lord Collins both briefly addressed the principles of autrefois acquit and convict, with Lord Collins noting that they do not apply to disciplinary proceedings, which are civil in nature. In relation to the abuse of process allegations, although Lord Clarke noted that the question of abuse of process raised some points of interest, he considered it would not be appropriate, in the circumstances, to express an opinion on them. Lord Collins commented that if this had been a case for application of an abuse of process approach, he would have had no hesitation in concluding that the second set of proceedings was not an abuse.


The Supreme Court's decision depended on a somewhat technical analysis of the ICAEW's bye-laws and complaints, with the result that, despite his conduct (which was criminal under Jersey law), Mr Coke-Wallis may continue to be a member of the Institute. Whilst the particular rules of other disciplinary regimes could, in principle, lead to a different result, the case emphasises the general force of the double jeopardy rule in relation to such proceedings.

This decision has also raised the issue once more of whether a "public interest" exception to the double jeopardy rule in professional disciplinary proceedings can be justified. Critics of the proposition say that, unlike with the medical profession, the public interest is not so immediate and compelling for professionals such as accountants so that it should override the very reason for creating a double jeopardy rule in any context. As many disciplinary hearings are held in public there are indeed valid reputational concerns for professional firms who might have to go through the hoops to clear their name more than once. This is particularly so in cases where the regulator's first attempt at charging the firm has failed because of a procedural or other technical error on their own part.

On a more general note, this case highlights the interesting and complex questions that result from parallel criminal, civil and regulatory proceedings. Professionals are facing increasing exposure to regulatory proceedings in the current climate, and will be very much aware that a civil claim or criminal proceedings affecting their practice could very well lead to their regulator taking a closer look at their activities.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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