Nadhim Zahawi instructed his lawyer to threaten legal action against a tax campaigner who helped reveal that the then chancellor was under investigation by HM Revenue and Customs, according to a tribunal document.
Zahawi’s solicitor, Ashley Hurst, is accused of breaching his regulator’s code of conduct by attempting to prevent Dan Neidle from publishing correspondence threatening legal action over the tax expert’s revelations about the then Tory leadership candidate.
The correspondence, sent by Hurst in July 2022, demanded that Neidle retract accusations of dishonesty against Zahawi in managing his tax affairs. The Solicitors Regulation Authority (SRA) said it also attempted to “improperly restrict” Neidle’s right to publish that correspondence or discuss its contents.
In November 2022, Neidle, who published the relevant email and follow-up letter despite the warnings not to, referred Hurst to the SRA for an alleged Slapp (strategic lawsuit against public participation), an oppressive legal tactic used to stifle criticism of prominent figures.
A document setting out the regulator’s case against Hurst, the head of client strategy at Osborne Clarke, says: “The inappropriate request made to Mr Neidle was an attempt to prevent public scrutiny of the decision by the then chancellor of the exchequer to resort to instructing a solicitor to write on his behalf and threaten legal action.
“Whilst it is not asserted that this threat was necessarily inappropriate, the attempt to prevent publication or discussion that such a threat had been made by a member of the government was, in the context of this case, inappropriate. Acting in such a manner is conduct that would serve to damage the public’s trust and confidence in the profession, and on that basis a breach.”
It further says that Zahawi was “under no obligation to address what he perceived to be a false accusation of lies through correspondence from a lawyer implying that legal action could follow”.
The initial email sent on 16 July warned that if Neidle shared it with anyone, other than for the purposes of seeking legal advice, it would be “a serious matter”.
The SRA’s statement says: “The attempt to restrict Mr Neidle’s handling of the 16 July email, and the threat of serious consequences should he not comply, was not correctly based on legal principles, but instead appears to have been made to try and shield Mr Zahawi and his affairs from further public scrutiny.”
In January last year, Zahawi admitted reaching a tax settlement with HMRC after an “error” over his shareholding in the polling company YouGov. He said HMRC had accepted it was not deliberate.
Hurst denies the SRA’s allegations, which are due to be heard at the solicitors disciplinary tribunal at a later date.
His lawyers’ written response says that publication by Neidle of the letter or email “would necessarily involve republication of the dishonesty imputation” made by the former Clifford Chance partner against Zahawi, adding: “It was a legitimate aim for Mr Hurst to seek to avoid the risk that publication of the correspondence by Mr Neidle would be likely to lead to a wave of secondary publicity, which would give further currency to the dishonesty imputation.”
It also says Hurst “was not seeking to oppress nor intimidate Mr Neidle, nor take unfair advantage of him, and there is no suggestion that Mr Neidle was in fact oppressed or intimidated or taken advantage of”.
Zahawi and Hurst were approached for comment.
