[2025] EWHC 1254 (Fam)

Fecha: 23-May-2025

The Respondent’s intermediary’s undertaking

The Respondent’s intermediary’s undertaking

56.

The Respondent’s case is that his intermediary is ill and the matter is urgent. The intermediary is a regulated solicitor of the Senior Courts. I accept he is ill. After having carried out his role he now asks to be discharged from his undertakings. The Applicant opposes this until a full financial audit has taken place into his professional role. It is not part of this court’s role to carry out a review or assessment of the intermediary’s roles in the respect of the various orders made by Bodey J. Determination of the Schedule 1 and specific issue orders does not require this. I am not considering other applications. From this limited perspective, I can see no reason why an audit is required before the undertaking is discharged. This does not prevent the Applicant seeking such relief in another court or before another forum should she wish to, although from what I have heard and read I can see no basis for this and nothing said in this judgment is to be used as basis to encourage further litigation.

57.

As directed, the Respondent summarised this issue and provided it to the Applicant on Thursday 15 May 2025, the day after the contested hearing. That document summarises the application as follows:

[The Respondent’s intermediary] is now very seriously unwell and is in hospital. The Security Deed and the order of 11 December 2013 confirm that in the event of [The Respondent’s intermediary’s] death, the Respondent was to make arrangements for the replacement of [his intermediary] with another ‘similarly suitable’ individual who would hold the fund in this jurisdiction and to enter into an identical agreement to the Security Deed. [The Respondent’s intermediary and firm] would then be discharged from their obligations. However no provision was made for what would happen in event of [the Respondent’s intermediary’s] incapacity or retirement from practice.

As [the Respondent’s intermediary] intends to retire from practice completely now and to close down his practice, in line with the Security Deed and order of 11 December 2013, the Respondent has nominated that Russell- Cooke hold the security fund instead. Russell-Cooke are willing to take over the holding of the security fund and to provide undertakings and to be covered by the court orders with identical provisions to those currently in place. This has been confirmed in the Deed of Novation (already signed by the Respondent and to be signed by Russell-Cooke if approval is received from the Court) and the draft order provided.

There will be no impact upon the Applicant and [the Child] of the transfer of this fund to Russell-Cooke. On a practical level, it will make the administration of the fund and payments to the Applicant more efficient as they will not need to be transferred from [the Respondent’s intermediary’s practice]to Russell-Cooke, and then on to the Applicant. In addition, given that Russell-Cooke is a large law firm, the operation of the fund will not be reliant upon one solicitor remaining in practice and the administration will be undertaken by the firm’s accounts department. A ledger will continue to be provided to the Applicant on an annual basis.

Transferring the fund from [the Respondent’s intermediary’s practice] has now become urgent to prevent what could be a significant delay if [the Respondent’s intermediary’s] health worsens. We understand that if [the Respondent’s intermediary] was to become incapacitated, the SRA may choose to intervene in [the Respondent’s intermediary’s practice]and take over the closing down of the firm. For the Applicant’s reference, this is because [the Respondent’s intermediary’s]practices as a sole practitioner, so there is not another solicitor there to continue running the firm. We understand that this would mean that the [the Respondent’s intermediary’s practice] client account, including the security fund held on it, would be frozen and payments would not be able to be made from it until it is released by the SRA. This could cause a significant delay in the security funds being transferred or payments from it being authorised. This is why Russell-Cooke have agreed to take over the fund and have made the application accordingly.

58.

The Applicant filed a written response on Monday 19 May 2025. Her previous written communications appeared to have consented to the Respondent’s application to release the Respondent’s intermediary from his undertaking. The recent response opposes it because the Applicant wants a full financial audit of transactions which have taken place. She is also concerned that the Respondent’s intermediary will continue to “act behind the scenes” to block her access and to ‘manipulate’. She is concerned there has been a breach of a trustee’s fiduciary duties and “the court risks enabling the continuation of concealed mismanagement.”

59.

I note there appear to be some applications which have been filed at court which may touch on this issue. For example a request by the Applicant to see a sealed envelope in the court file related to the Respondent’s intermediary’s firm. I am not dealing with those applications as they have not been listed by the court to be determined at the hearing.

60.

Nonetheless, I have acceded to the Respondent’s application and will release the Respondent’s intermediary from the undertakings given to Mr Justice Bodey in 2013. I do that because I am told he is gravely ill and wishes to retire from practice as a solicitor. I will accept an undertaking from Russell-Cooke LLP to hold the security fund in the interim. The relevant documents shall be served on the Applicant so she understands the changes in the arrangements made. The order will provide her with permission to seek to vary the undertaking or apply for it to be discharged and alternative arrangements to be made, if so advised. I can currently see no basis for this but I am responding to the urgent application to release the Respondent’s intermediary, given his ill-health. If there are any issues with his historical dealings with the security fund, this can be considered in the future. It may be that Russell-Cooke can provide information to the Applicant which will satisfy any questions she has in respect of the role the Respondent’s intermediary has historically carried out. There may well be costs consequences of unmeritorious applications.