Ethics

Question 1

SRA Compliance Officers

Answer 1

All firms must appoint 2 COs: Compliance officer for legal practice (COLP) and officer for finance and administration (COFA). - Authorised for these roles by SRA, responsibilities set out by SRA code of Conduct for Firms
- Must report breaches of code of conduct to the SRA

Question 1

SRA Code of Conduct for Firms

Answer 1

• Standards expected of firms (including sole practices) authorised by SRA to provide legal services
• Many are incorporated into code of conduct for firms (CoC for Solicitors and CoC for Firms = The Code of Conduct)

Question 2

SRA Accounts Rules

Answer 2

Specific requirements placed on solicitors in financial matters (particularly when dealing with money belonging to clients or third parties)

Question 3

Duties on Solicitors: Complaints

Answer 3

A solicitor must ensure (Paragraph 8.3) that clients are informed in writing at the time of engagement about:

(a) their right to complain about the solicitor’s services and charges;

(b) how complaints may be made and to whom; and

(c) any right they have to make a complaint to the Legal Ombudsman (see 1.5) and when they can make such complaint

Question 4

What if complaints cannot be resolved in <8 weeks

Answer 4

When a client has made a complaint, if this has not been resolved to the client’s satisfaction within eight weeks following the making of a complaint, the solicitor must ensure (Paragraph 8.4) that the client is informed in writing:

(a) of any right they have to complain to the Legal Ombudsman, the timeframe for doing so

and full details of how to contact the Legal Ombudsman; and

(b) if a complaint has been brought and the complaints procedure has been exhausted:

(i) that the solicitor cannot settle the complaint;

(ii) the name and website address of an alternative dispute resolution (ADR) approved

body which would be competent to deal with the complaint; and

(iii) whether the solicitor agrees to use the scheme operated by that body

Clients’ complaints must be dealt with promptly, fairly and free of charge (Paragraph 8.5)

Question 5

What kinds of complaints can legal ombudsman deal with?

Answer 5

• Complaint can be any act / omission from solicitor and must relate to services provided
  
  • also accepts complaints in relation to services solicitor offered, provided, or refused to provide to the complainant
• Need not be loss to the client

Question 6

When can client bypass solicitor’s own complaints procedure and go straight to Legal Omb.?

Answer 6

(a) the complaint has not been resolved to the complainant’s satisfaction within eight weeks of being made to the solicitor; or

(b) the LeO considers that there are exceptional reasons to consider the complaint sooner, or without it having been made first to the solicitor; or

(c) the LeO considers that in-house resolution is not possible due to irretrievable breakdown in the relationship between the solicitor and the complainant.

Question 7

What kinds of clients can complain to the Legal Ombudsman

Answer 7

• Micro-enterprises (fewer than 10 staff, balance sheet / turnover no more than 2 million euro)
• Charities
• clubs and associations with an income of less than 1M pounds
• personal representatives or beneficiaries of an estate

Question 8

Timing of complaint to legal ombudsman

Answer 8

General rule: complaint should be brought no later than 1 year from act or omission or one year from when the complainant should reasonably have known there was cause for complaint
- but LO can extend time limits if they would like

Question 9

When will the LeO hold a hearing to adjudicate a complaint

Answer 9

Hearings only done when LeO considers complaint cannot be determined fairly without one

Question 10

Limits on the LO’s power to order a firm remedies a complaint with $

Answer 10

If LO orders the putting right of an error or additional action taken on their behalf this has a limit of 50k

Question 11

if a complainant accepts the determination of an LO, can they sue the Solicitor privately as well?

Answer 11

If complainant accepts the determination, it is binding and final (neither may start or continue legal proceedings in respect of it)
- BUT may be enforced in the HC or CC

Question 12

If a party rejects a determination from the LO - can they pursue other legal remedies or have they exhausted their options?

Answer 12

They are free to look elsewhere for remedies (ie. litigation)

Question 13

When will the LeO refer a complaint matter to the court

Answer 13

If it considers a particular legal question which the LeO is not well equipped to answer

Question 14

Does the LO need to inform the SRA at any point in their adjudication of a complaint?

Answer 14

Where the LeO receives a complaint which discloses any alleged professional misconduct on the part of the solicitor, it will inform the SRA.

Question 15

Potential penalties the SRA can impose on those who breach professional conduct rules:

Answer 15

1. Take no further action with or without issuing advice or a warning about future conduct
2. Impose a financial penalty or written rebuke
3. Control how the solicitor practises
4. Refer the matter to the Solicitor’s disciplinary tribunal

Question 16

Are decisions of the SRA about professional misconduct confidential?

Answer 16

No they are made public

Question 17

Role of the Solicitor’s Disciplinary Tribunal

Answer 17

The Solicitors Disciplinary Tribunal (SDT) hears and determines applications relating to allegations of unbefitting conduct and/or breaches of the requirements of professional conduct by a number of legal service providers, including solicitors.

Question 18

When can someone apply directly to the SDT?

Answer 18

In all situations except those where SA 1974 mandates a prior complaint / application to the SRA

Question 19

SDT decisions: what ar they called

Answer 19

SDT decisions are called ‘Judgements’ and ‘Orders’

1. Order takes effect once filed with Law Society
2. Written judgement with reasons (and repeating order) made available to (1) parties, (2) Law Society, and (3) SDT website after the hearing (usually within seven weeks)

Question 20

Powers of the SDT for disciplining a solicitor

Answer 20

SDT has the power to make such orders as in its discretion it thinks fit, including: striking a solicitor off the role (or restoring them), suspending a solicitor from practice or imposing restrictions on their practice, imposing an unlimited find payable to HM treasury, reprimanding solicitor, requiring payment by any party of costs or a contribution towards costs

Question 21

When appealing a decision of the SDT - where would the appeal be heard?

Answer 21

The administrative Court

Question 22

Purpose of the SRA Compensation fund

Answer 22

Fund is maintained by the SRA, governed by the SRA Compensation Fund Rules and exists as a last resort to make grants to persons whose money has been stolen or otherwise not accounted for as a result of an act or omission of those regulated by the SRA and to relieve losses for which SRA authorised bodies should have insurance but do not

Question 23

How does an individual access the SRA Compensation Fund

Answer 23

Individuals may apply when they (as an individual or organisation) has suffered loss due to a defaulting practitioner’s dishonesty or whether they have suffered loss and hardship due to the practitioner’s failure to account for monies they have received

Question 24

Maximum the SRA Compensation Fund will pay out / limitations on accessing the fund

Answer 24

- Will not pay out sums of more than 2m per claim (unless there are exceptional circumstances **in the public interest** that justify the sum) - For multiple related or connected claims, SRA may impose a cap of 5M on total account paid - The client may be asked to exhaust any legal remedy before applying to the Fund

Question 25

Breach of what SRA Principle will lead to the most severe sanction

Answer 25

(4) Honesty: solicitors must act with honesty

Question 26

Test for judging whether a solicitor acted 'dishonestly' in contravention to the SRA Principles

Answer 26

*Ivey v Genting Casinos* introduced a 2 stage test 1. Individual’s actual belief or knowledge as to the facts a. Belief need not be objectively reasonable (but reasonableness or how other solicitors may have acted can indicate whether the belief was genuine) 2. The objective standards of ordinary decent people (with regard to knowledge and belief at the time of the solicitor) a. No requirement that solicitor knew or understood that their behaviour was dishonest

Question 27

SRA Transparency Rules: Which services of covered (wrt individuals)

Answer 27

* residential conveyancing, * uncontested probate (where all assets are within the UK), * motoring offences (summary only offences), * employment tribunals (claims for unfair or wrongful dismissal), * immigration (excluding asylum applications).

Question 28

SRA Transparency Rules: Which services of covered (wrt businesses)

Answer 28

* debt recovery (up to £100,000), * employment tribunals (defending claims for unfair or wrongful dismissal), * licensing applications for business premises.u

Question 29

Purpose of the SRA Transparency Rules

Answer 29

Aim: ensure that consumers of legal services have accurate and relevant information about a solicitor or firm when they are considering purchasing legal services

Question 30

Information which must be given about costs (as mandated by the SRA Transparency Rules)

Answer 30

(a) the total cost of the service or, where this is not practicable, the average cost or range of costs, and details of any disbursements; (b) the basis for the charges (including any hourly rate or fixed fees); (c) what services are included within the displayed price and details of any services which might reasonably be expected to be included in the price but are not; (d) the experience and qualifications of anyone carrying out the work (and their supervisors); (e) whether VAT is payable on the fees or disbursements and, if so, if this is included in the price; (f) typical timescales and the key stages of the matter; (g) if conditional fee or damages- based agreements are used, the circumstances in which clients may have to make any payments themselves for the services received (including from any damages).

Question 31

How do the SRA Transparency Rules apply to firms which do not have a website?

Answer 31

The information must be available on request

Question 32

Requirements of the SRA Transparency Rules:

Answer 32

certain services have to make set information about costs public - clearly accessible on the website

Question 33

Can a solicitor make an unsolicited approach to an individual for marketing purposes?

Answer 33

Paragraph 8.9 prohibits a solicitor from making unsolicited approaches to individual members of the public which, even if permitted by law, may feel unwelcome or intrusive. - Exception: in respect of current or former clients because this is not ‘the general public’

Question 34

Restrictions on naming a firm something with 'solicitors in the title

Answer 34

Cannot do so unless they are SRA Regulated

Question 35

Requirements to show SRA registration

Answer 35

General Rule: A body authorised by SRA must display on a prominent place its SRA number and ‘digital badge’, the website must also publish the firm’s complaints handling process, together with details about how to complain to the SRA and Legal Ombudsman, letter head and emails must also show SRA number and words ‘authorised and regulated by the SRA’

Question 36

Can a solicitor refer a client to a third party?

Answer 36

Generally yes - but in respect of such a referral the client must be informed of any financial or other interest which the solicitor, the solicitor’s business or employer has in referring the client to another person/ body (Paragraph 5.1(a)).

Question 37

Solicitor's Clients obtained through an 'introducer': Restrictions

Answer 37

Any client referred to the solicitor by an introducer must not have been acquired in a way which would breach the SRA’s regulatory arrangements if the person acquiring the client were regulated by the SRA (ie. unsolicited approaches)

Question 38

What are fee sharing arrangements? How are these regulated by the SRA?

Answer 38

Fee- sharing would occur if a solicitor made a payment to a third party in respect of a percentage of the solicitor’s gross or net fees for a particular period. Clients must be informed of any fee- sharing arrangement that is relevant to their matter, and the fee- sharing agreement must be in writing (Paragraph 5.1(b) and (c)).

Question 39

When are referral fees prohibited by legislation

Answer 39

LASPO 2012: payment or receipt of referral fees in claims for damages following personal injury or death is prohibited, also payment for other claims for damages arising from the same circumstances are prohibited

Question 40

Can a solicitor act on instructions of someone that the client has authorised to act on their behalf?

Answer 40

Yes

Question 41

What must a solicitor do if they doubt that a client's instructions reflect their wishes

Answer 41

The solicitor must not act unless they have satisfied themselves that they do - if they are not satisfied they should decline to act

Question 42

What should a solicitor do if they suspect a client will make a claim of duress against them

Answer 42

Seek protection from the HC

Question 43

When are gifts 'significant'

Answer 43

(1) Worth more than 1% of client’s current estimated net estate (2) it might become valuable at some point, especially after client’s death (3) Value of benefit too great to be justified by relationship

Question 44

Scenario where in a solicitor is going to receive a gift and the client has not taken independent legal advice - AND THE SOLICITOR CAN STILL ACT

Answer 44

If the solicitor is drafting wills for their own parents and survivor of them wishes to leave residual estate to the solicitor and their sibling in equal shares

Question 45

What must the solicitor due if instructions would place them in breach of the Code of Conduct for Solicitors?

Answer 45

Refuse to act

Question 46

How long to duties to the client (commenced) during the retainer last?

Answer 46

Some (confidentiality) last after retainer has been terminated

Question 47

Duty of reasonable care and skill

Answer 47

In addition to the solicitor’s duty of care in common law, s 13 Supply of Goods and Services Act 1982 provides that a supplier of services will carry out those services with reasonable care and skill. This term is implied into the retainer between a solicitor and the client, and therefore the solicitor may be sued for a breach of contract if the term is breached.

Question 48

Exceptions to the duty to provide legal services with reasonable care and skill

Answer 48

this implied term does not apply to advocacy services provided before a court, tribunal, inquiry or arbitrator (Supply of Services (Exclusion of Implied Terms) Order 1982 (SI 1982/ 1771), art 2).

Question 49

Presumption of Undue Influence in Solicitor Client Relationship

Answer 49

This means that in any dealings between a solicitor and the client, there will be a rebuttable presumption that the solicitor has exercised undue influence in persuading the client to enter into that dealing. In order to rebut this presumption, the solicitor would need to show that such influence had not been exercised, for example by making a full disclosure of all relevant facts, ensuring that the client took independent legal advice and understood the transaction, and ensuring that all dealings were fair and at arm’s length.

Question 50

How can a retainer be terminated?

Answer 50

As with any contractual relationship, the retainer may be terminated by either party, or by the general law.

Question 51

If a client terminates the retainer are they liable to pay outstanding costs?

Answer 51

- For any time for any reason, but client may be liable to pay fees for work done up until that point - Solicitor may require these fees paid before forwarding client their file

Question 52

Reasons a solicitor could terminate a retainer?

Answer 52

(A) complying with the client’s instructions would involve the solicitor in a breach of the law or the requirements of professional conduct; (B) the solicitor cannot obtain proper instructions from the client; (C) there has been a breakdown in confidence within the relationship between the solicitor and client (eg the client is not willing to accept the advice of the solicitor).

Question 53

When would a retainer terminate by law?

Answer 53

1. Where solicitor is declared bankrupt and is practicing as a sole practitioner (if not, would go to other parties) 2. If either party loses mental capacity after retainer has commecned

Question 54

Responsibilities of the Solicitor on termination

Answer 54

- Solicitor should confirm termination in writing - Explain clients possible options for pursuing matter and take steps to deal with any property of the client which may be held by the solicitor (ie. client money) - May be good to retain copy of file if passing on to another firm of solicitors (in accordance with **DPA 2018**) - To defend themselves from future claims of negligence

Question 55

Potential Outcomes a Solicitor must discuss with their client with respect to costs:

Answer 55

Solicitor must discuss potential outcomes, and whether they justify risk which includes: - paying someone else’s legal fees (all or a portion) - Whether this will be covered by legal expenses insurance - Whether they (even if they win) are still liable to pay own solicitor’s cost - the amount that the losing party in litigation has to pay to the winning party will be assessed by the court or subject to the fixed recoverable costs regime, and it is unlikely to cover the entirety of the winning client’s legal costs. The client must know the circumstances in which they will be responsible for the shortfall. - May also be liable if losing party cannot make cost order **This must be done prior to entering litigious proceedings**

Question 56

Different ways a solicitor may charge a client

Answer 56

1. Hourly Rate 2. Fixed Fees 3. Variable Fee (varies according to outcome)