[2024] UKUT 264 (LC)

Chambers’ Constitution provides for the terms of membership and for the management of Chambers through Chambers’ meetings occurring at least once a year, a Management Committee meeting monthly, a number of other Committees and the Head of Chambers. The Constitution also provides for Members’ contributions to Chambers’ expenses and for the ownership of Chambers’ property.

Ultimate power over Chambers is exercisable by the passing of ordinary or special resolutions by Members at Chambers meetings. A special resolution requires the support of three quarters of those voting at the meeting, while an ordinary resolution requires a majority vote of those present at the meeting. The quorum for meetings is one half of the Members.

Membership of Chambers is by invitation approved by a special resolution at a Chambers’ meeting. Membership is conditional on agreeing to be bound by the terms of the Constitution, signified by signing the document. Membership continues until the Member dies, resigns or is expelled. Mr Prosser KC explained that no Member had been expelled since 1991.

The Head of Chambers is required to convene a Chambers’ Meetings at least once a year as soon as possible after 1 April. That meeting is referred to as the AGM, and its business is provided for by the Constitution and includes approving accounts and budgets, fixing staff salaries and Members’ contributions, and electing committees. Meetings may be convened at other times by the Head of Chambers whenever he thinks fit.

The general management and administration of Chambers is the responsibility of the Management Committee which comprises the Head of Chambers, the Senior Clerk and at least four Members. It is charged with implementing general policies decided by the Members, preparing the budget for approval by the AGM, financial control and the preparation of accounts, and such other functions as the Members may from time to time decide. It is required to refer important administrative and financial decisions to a Chambers meeting for prior approval.

Amongst the responsibilities of the Head of Chambers is the leadership of Chambers, the maintenance of professional standards by Members, and the provision of advice and encouragement to Members. The Head of Chambers is also responsible for the employment of staff on behalf of all Members.

Clause 40 of the Constitution provides that “each Member shall bear his due proportion of the rent, rates and other expenses of Chambers”. Members’ contributions towards rent and rates and their contributions towards other expenses are calculated differently.

Clause 41 provides for the “due proportion of the rent and rates attributable to a Member’s room” (referred to as an “own room contribution”) to be determined by reference to floor area. In practice all Rooms are banded into one of four bands with the highest own room contribution being charged for the largest Rooms and the lowest contribution for the smallest Rooms. For example, at the material day the own room contribution for the largest Rooms was £19,200 a year while for the smallest it was £6,000 a year.

The due proportion of all residual expenses (i.e. expenses other than the rent and rates attributable to Rooms) is a percentage of a Member’s receipts from work done while a Member, subject to a cap. The percentage and the cap for the forthcoming year are among the matters determined by Members at the AGM. Residual expenses include the rent and rates attributable to those parts of Chambers’ accommodation (clerks’ rooms, conference rooms etc) which are not occupied by individual Members.

The key point about the financial organisation of Chambers under the Constitution is that Members share expenses but do not share receipts (thereby avoiding being in partnership). Each Member benefits from the pooling of expenses, as the accommodation and services they require to carry on their individual practices can be secured more efficiently and cost-effectively than if each made their own separate arrangements.

Provision is made in the Constitution for circumstances in which the own room contribution will not be payable. A Member who is absent on maternity leave is not required to make an own room contribution during the period of absence. A Member who is absent for any other reason, including illness, may be exempted from paying the own room contribution by an ordinary resolution passed at a Chambers’ meeting. A new Member who joins Chambers on completion of pupillage is not required to contribute to Chambers’ expenses for the first two years of their membership and will therefore occupy a Room without charge. In each of these circumstances the contribution foregone becomes part of the residual expenses of Chambers borne by the other Members.

In its original form the Constitution dealt only with maternity leave and not with other forms of parental leave. A new parental leave and part-time working policy was adopted by Chambers on 1st June 2016 and was in force at the material day. This policy authorised Chambers to make use of any Member’s Room while they were absent on parental leave, and also empowered the Management Committee to require a Member who was working on a part-time basis (defined as less than 40 hours a week) to move to a smaller room or share with another Member. The new policy was introduced after a prolonged period of maternity leave by one Member during which she retained her Room but made little or no use of it. The policy was approved at the 2016 AGM without any debate being recorded in the minutes and Mr Prosser KC and Ms Choudhury KC who were asked questions about it were unable to recall there having been any. In the event, the provisions of the policy concerning the use of Rooms were never used and new policies were introduced with effect from 2nd October 2018.

The parental leave policy which applied at the material day also provided that rent for a Member’s Room would be waived for a period of six months following their return from parental leave, and that Chambers contributions would be waived for at least six months, and for up to 12 months (depending on the Member’s professional receipts). If at the end of this period of time the member’s outstanding receipts are less than £250,000 Chambers contributions (but not rent) will continue to be waived until such time as the returning member’s outstanding receipts exceed this sum or for a further period of 6 months whichever is the sooner.

The Constitution also provides that all leases, plant, equipment and other property acquired or held for or at the expense of Chambers are to be held by one or more Members on trust for all the Members. No other provision is made in the document concerning the occupation, control or use of Rooms. In particular, the Constitution does not guarantee that each Member will have a Room, although in practice that is what happens (for new recruits sometimes after a period of room sharing).