Legal Services Bill [HL]

House of Commons

Session 2006 - 07
Internet Publications
Other Bills before Parliament

Legal Services Bill [HL]

Legal Services Bill [HL]
Part 1 — The regulatory objectives
1

[NOTE: The words marked in bold type were inserted by the Lords to avoid
questions of privilege.]
A
Bill
To
Make provision for the establishment of the Legal Services Board and in
respect of its functions; to make provision for, and in connection with, the
regulation of persons who carry on certain legal activities; to make provision
for the establishment of the Office for Legal Complaints and for a scheme to
consider and determine legal complaints; to make provision about claims
management services and about immigration advice and immigration
services; to make provision in respect of legal representation provided free of
charge; to make provision about the application of the Legal Profession and
Legal Aid (Scotland) Act 2007; to make provision about the Scottish legal
services ombudsman; and for connected purposes.
Be it enacted by the Queen’s most Excellent Majesty, by and with the advice and
consent of the Lords Spiritual and Temporal, and Commons, in this present
Parliament assembled, and by the authority of the same, as follows:—
Part 1
The regulatory objectives
1
The regulatory objectives
(1)
In this Act a reference to “the regulatory objectives” is a reference to the
objectives of—
5
(a)
protecting and promoting the public interest;
(b)
supporting the constitutional principle of the rule of law;
(c)
improving access to justice;
(d)
protecting and promoting the interests of consumers;
(e)
promoting competition in the provision of services within subsection
10
(2);
(f)
encouraging an independent, strong, diverse and effective legal
profession;
(g)
increasing public understanding of the citizen’s legal rights and duties;
(h)
promoting and maintaining adherence to the professional principles.
15

Bill 108 54/2

Legal Services Bill [HL]
Part 2 — The Legal Services Board
2

(2)
The services within this subsection are services such as are provided by
authorised persons (including services which do not involve the carrying on of
activities which are reserved legal activities).
(3)
The “professional principles” are—
(a)
that authorised persons should act with independence and integrity,
5
(b)
that authorised persons should maintain proper standards of work,
(c)
that authorised persons should act in the best interests of their clients,
(d)
that persons who exercise before any court a right of audience, or
conduct litigation in relation to proceedings in any court, by virtue of
being authorised persons should comply with their duty to the court to
10
act with independence in the interests of justice, and
(e)
that the affairs of clients should be kept confidential.
(4)
In this section “authorised persons” means authorised persons in relation to
activities which are reserved legal activities.
Part 2
15
The Legal Services Board
Constitution
2
The Legal Services Board
(1)
There is to be a body corporate called the Legal Services Board (“the Board”).
(2)
Schedule 1 is about the Board.
20
General functions
3
The Board’s duty to promote the regulatory objectives etc
(1)
In discharging its functions the Board must comply with the requirements of
this section.
(2)
The Board must, so far as is reasonably practicable, act in a way—
25
(a)
which is compatible with the regulatory objectives, and
(b)
which the Board considers most appropriate for the purpose of meeting
those objectives.
(3)
The Board must have regard to—
(a)
the principles under which regulatory activities should be transparent,
30
accountable, proportionate, consistent and targeted only at cases in
which action is needed, and
(b)
any other principle appearing to it to represent the best regulatory
practice.
4
Standards of regulation, education and training
35
The Board must assist in the maintenance and development of standards in
relation to—
(a)
the regulation by approved regulators of persons authorised by them
to carry on activities which are reserved legal activities, and

Legal Services Bill [HL]
Part 2 — The Legal Services Board
3

(b)
the education and training of persons so authorised.
5
Corporate governance
In managing its affairs, the Board must have regard to such generally accepted
principles of good corporate governance as it is reasonable to regard as
applicable to it.
5
6
Annual report
(1)
The Board must prepare a report (“the annual report”) for each financial year.
(2)
The annual report must deal with—
(a)
the discharge of the Board’s functions,
(b)
the extent to which, in the Board’s opinion, the Board has met the
10
regulatory objectives, and
(c)
such other matters as the Lord Chancellor may from time to time direct.
(3)
As soon as reasonably practicable after the end of each financial year, the Board
must give the Lord Chancellor a copy of the annual report prepared for that
year.
15
(4)
The Lord Chancellor must lay a copy of the annual report before Parliament.
(5)
In this section “financial year” means—
(a)
the period beginning with the day on which the Board is established
and ending with the next following 31 March, and
(b)
each successive period of 12 months.
20
7
Supplementary powers
The Board may do anything calculated to facilitate, or incidental or conducive
to, the carrying out of any of its functions.
Consumer Panel
8
The Consumer Panel
25
(1)
The Board must establish and maintain a panel of persons (to be known as “the
Consumer Panel”) to represent the interests of consumers.
(2)
The Board must appoint to the Consumer Panel such consumers, or persons
representing the interests of consumers, as the Board considers appropriate.
(3)
The Board must appoint one of the members of the Consumer Panel to be the
30
chairman of the Panel.
(4)
The Board must secure that the membership of the Consumer Panel is such as
to give a fair degree of representation to both—
(a)
those who are using (or are or may be contemplating using), in
connection with businesses carried on by them, services provided by
35
persons who are authorised persons in relation to activities which are
reserved legal activities, and

Legal Services Bill [HL]
Part 2 — The Legal Services Board
4

(b)
those who are using (or are or may be contemplating using) such
services otherwise than in connection with businesses carried on by
them.
(5)
The Consumer Panel must not include any person who is—
(a)
a member of the Board or of its staff;
5
(b)
a member of the Office for Legal Complaints (see Part 6), an
ombudsman appointed by it or a member of its staff appointed under
paragraph 11 of Schedule 15;
(c)
a member of the governing body, or of the staff, of an approved
regulator;
10
(d)
an authorised person in relation to an activity which is a reserved legal
activity;
(e)
a person authorised, by a person designated under section 5(1) of the
Compensation Act 2006 (c. 29), to provide services which are regulated
claims management services (within the meaning of that Act);
15
(f)
an advocate in Scotland;
(g)
a solicitor in Scotland;
(h)
a member of the Bar of Northern Ireland; or
(i)
a solicitor of the Court of Judicature of Northern Ireland.
(6)
The chairman and other members of the Consumer Panel are to be—
20
(a)
appointed on terms and conditions determined by the Board, and
(b)
paid by the Board in accordance with provision made by or under the
terms of appointment.
9
Committees and the procedure of the Consumer Panel
(1)
The Consumer Panel may make such arrangements as it thinks fit for
25
committees established by the Panel to give advice to the Panel about matters
relating to the carrying out of the Panel’s functions.
(2)
The Consumer Panel may make such other arrangements for regulating its
own procedure, and for regulating the procedure of the committees
established by it, as it thinks fit.
30
(3)
Those arrangements may include arrangements as to quorums and as to the
making of decisions by a majority.
(4)
The committees established by the Consumer Panel may include committees
the membership of which includes persons who are not members of the Panel.
(5)
The membership of every committee established by the Consumer Panel must
35
contain at least one person who is a member of the Panel.
(6)
Where a person who is not a member of the Consumer Panel is a member of a
committee established by it, the Board may pay to that person such
remuneration and expenses as the Board may determine.
10
Representations by the Consumer Panel
40
(1)
The Board must consider any representations made to it by the Consumer
Panel.

Legal Services Bill [HL]
Part 3 — Reserved legal activities
5

(2)
If the Board disagrees with a view expressed, or proposal made, in the
representations, it must give the Consumer Panel a notice to that effect stating
its reasons for disagreeing.
(3)
The Consumer Panel may publish such information as it thinks fit about any
representations made by it to the Board.
5
(4)
Where the Consumer Panel publishes information about any representations
made by it, the Board must publish any notice it gives under subsection (2) in
respect of those representations.
11
Advice and research functions of the Consumer Panel
(1)
The Consumer Panel may, at the request of the Board—
10
(a)
carry out research for the Board;
(b)
give advice to the Board.
(2)
The Board must consider any advice given and the results of any research
carried out under this section.
(3)
The Consumer Panel may publish such information as it thinks fit about advice
15
it gives, and about the results of research carried out by it, under this section.
Part 3
Reserved legal activities
Reserved legal activities
12
Meaning of “reserved legal activity” and “legal activity”
20
(1)
In this Act “reserved legal activity” means—
(a)
the exercise of a right of audience;
(b)
the conduct of litigation;
(c)
reserved instrument activities;
(d)
probate activities;
25
(e)
notarial activities;
(f)
the administration of oaths.
(2)
Schedule 2 makes provision about what constitutes each of those activities.
(3)
In this Act “legal activity” means—
(a)
an activity which is a reserved legal activity within the meaning of this
30
Act as originally enacted, and
(b)
any other activity which consists of one or both of the following—
(i)
the provision of legal advice or assistance in connection with the
application of the law or with any form of resolution of legal
disputes;
35
(ii)
the provision of representation in connection with any matter
concerning the application of the law or any form of resolution
of legal disputes.
(4)
But “legal activity” does not include any activity of a judicial or quasi-judicial
nature (including acting as a mediator).
40

Legal Services Bill [HL]
Part 3 — Reserved legal activities
6

(5)
For the purposes of subsection (3) “legal dispute” includes a dispute as to any
matter of fact the resolution of which is relevant to determining the nature of
any person’s legal rights or liabilities.
(6)
Section 24 makes provision for adding legal activities to the reserved legal
activities.
5
Carrying on the activities
13
Entitlement to carry on a reserved legal activity
(1)
The question whether a person is entitled to carry on an activity which is a
reserved legal activity is to be determined solely in accordance with the
provisions of this Act.
10
(2)
A person is entitled to carry on an activity (“the relevant activity”) which is a
reserved legal activity where—
(a)
the person is an authorised person in relation to the relevant activity, or
(b)
the person is an exempt person in relation to that activity.
(3)
Subsection (2) is subject to section 23 (transitional protection for non-
15
commercial bodies).
(4)
Nothing in this section or section 23 affects section 84 of the Immigration and
Asylum Act 1999 (c. 33) (which prohibits the provision of immigration advice
and immigration services except by certain persons).
Offences
20
14
Offence to carry on a reserved legal activity if not entitled
(1)
It is an offence for a person to carry on an activity (“the relevant activity”)
which is a reserved legal activity unless that person is entitled to carry on the
relevant activity.
(2)
In proceedings for an offence under subsection (1), it is a defence for the
25
accused to show that the accused did not know, and could not reasonably have
been expected to know, that the offence was being committed.
(3)
A person who is guilty of an offence under subsection (1) is liable—
(a)
on summary conviction, to imprisonment for a term not exceeding 12
months or a fine not exceeding the statutory maximum (or both), and
30
(b)
on conviction on indictment, to imprisonment for a term not exceeding
2 years or a fine (or both).
(4)
A person who is guilty of an offence under subsection (1) by reason of an act
done in the purported exercise of a right of audience, or a right to conduct
litigation, in relation to any proceedings or contemplated proceedings is also
35
guilty of contempt of the court concerned and may be punished accordingly.
(5)
In relation to an offence under subsection (1) committed before the
commencement of section 154(1) of the Criminal Justice Act 2003 (c. 44), the
reference in subsection (3)(a) to 12 months is to be read as a reference to 6
months.
40