The High Court has ruled that the Serious Fraud Office (SFO) should pay the costs of three solicitors after wrongly trying to prosecute them on conspiracy charges.
Retired consultant Eric Evans, his professional partner Alan Whiteley and assistant solicitor Frances Bodman had helped to set up a mining scheme involving south Wales company Celtic Energy Ltd.
The trio, along with Celtic Energy directors Richard Walters and Leighton Humphreys and deputy High Court judge Stephen Davies QC, who advised the scheme was lawful, were subject to two counts of conspiracy to defraud.
The High Court dismissed the case last February, and in November threw it out for a second time after the SFO applied for permission to prefer a voluntary bill of indictment.
The group, with the exception of Bodman, applied for two costs orders against the SFO and was last week granted costs on the indemnity basis by Mr Justice Hickinbottom. The costs bill presented by the group is expected to be around £7m.
The judge made the order after finding the application was brought without ‘proper cognisance’ of the high hurdle a prosecutor has to overcome for a voluntary bill.
‘It was clear from the application that the case as put forward in the first iteration had no realistic prospect of success, as the SFO belatedly accepted,’ said Hickinbottom. ‘The other iterations were attempts to save a fatally holed ship, that presented as a sequence of different cases that stood no real prospect of success or were in essence too late.’
Philip Williams, a serious fraud case specialist at Blackfords Solicitors, who represented Evans, said the case had shown up ‘systemic flaws’ in the way that the SFO investigation was initiated and carried through.
He added: ‘It is not the first time that the SFO have found themselves having to make amends for flawed investigations and undoubtedly questions will be raised over whether the SFO is fit for purpose.’
Added Williams: ‘We are pleased to have a positive conclusion on this case for our client Eric Evans, who was wrongly alleged to be the architect of a fraud.
‘In fact he was the progenitor of a clever, technical commercial agreement characteristic of a dynamic solicitor responsible for the development of many landmark commercial sites along the M4 corridor over many years.’
Evans said: ‘The SFO never understood the planning law underpinning the agreement I designed. Their conduct has been wholly flawed. In attempting to prosecute me with an offence not known to law, they have repeatedly changed their case.
‘They instructed a QC who had personally advised prosecution witnesses. They have buried caselaw unhelpful to their position. They have failed to give my legal team material they held which undermined their case.
‘This is a further case of a catalogue of cases where the SFO have impugned their reputation and authority. The government continues to pump money into misconceived SFO blockbuster cases. I wouldn’t be surprised if there were more calls for it to be disbanded as a result of this case.’
In a statement, the SFO said it is ‘considering possible avenues of appeal’.