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Public Bill Committee: 19th June 2007                  

375

 

Legal Services Bill-[Lords], continued

 
 

This amendment adjusts the management and control condition in sub-paragraph (4) to provide

 

that at least one of the directors is a person in sub-paragraph (4)(a), and at least one of the persons

 

who holds shares in the body (see amendment 190) falls under sub-paragraph (4)(a).

 

Bridget Prentice

 

190

 

Schedule  16,  page  265,  line  13,  leave out ‘have an interest’ and insert ‘hold shares’.

 

 

Members’ explanatory statement

 

This amendment is related to amendment 111. It replaces the concept of interest in the recognised

 

body with a shareholding in the recognised body.

 

Bridget Prentice

 

191

 

Schedule  16,  page  265,  line  45,  after ‘managers’, insert ‘or employees’.

 

 

Members’ explanatory statement

 

This amendment alters the definition of “relevant legal services” to refer to employees who are

 

authorised persons, rather than just managers who are authorised persons.

 

Bridget Prentice

 

192

 

Schedule  16,  page  266,  line  2,  at end insert—

 

‘“shares”, in relation to a body, has the same meaning as in Part 5 of the

 

Legal Services Act 2007 (see sections 72 and 109 of that Act);’.

 

 

Members’ explanatory statement

 

This amendment is related to amendment 190, which replaces a reference to an interest in shares

 

with a reference to holding shares. It gives “shares” the same meaning as in Clause 72.

 

Bridget Prentice

 

193

 

Schedule  16,  page  266,  line  4,  leave out ‘in shares’.

 

 

Members’ explanatory statement

 

This amendment is related to amendment 111. It adjusts the definition of interest in a recognised

 

body to refer to the definition of interest in a body in Clause 72 of the Bill, rather than the former

 

“interest in shares” in a body.

 

Mr Jonathan Djanogly

 

Mr Henry Bellingham

 

Mr Tobias Ellwood

 

317

 

Parliamentary Star    

Schedule  16,  page  267,  line  35,  at end insert—

 

‘“body” includes an individual who is carrying on a business as a sole

 

principal;’.

 

Bridget Prentice

 

194

 

Schedule  16,  page  270,  line  42,  at end insert ‘, and for this purpose a person has an

 

interest in the body if he has an interest in the body within the meaning of Part 5 of the

 

Legal Services Act 2007 (see sections 72 and 109 of that Act).’.

 

 

Members’ explanatory statement


 
 

Public Bill Committee: 19th June 2007                  

376

 

Legal Services Bill-[Lords], continued

 
 

This amendment inserts a definition of “interest in the body”. The definition refers to the definition

 

of interest in a body in Clause 72 of the Bill.

 

Bridget Prentice

 

195

 

Schedule  16,  page  272,  line  10,  leave out ‘in shares’.

 

 

Members’ explanatory statement

 

This amendment is related to amendment 111. It adjusts the meaning of interest in a recognised

 

body to refer to the definition of interest in a body in Clause 72 of the Bill, rather than the former

 

“interest in shares” in a body.

 

Bridget Prentice

 

196

 

Schedule  16,  page  272,  line  35,  leave out ‘in shares’.

 

 

Members’ explanatory statement

 

This amendment is related to amendment 111. It replaces the concept of persons with an interest

 

in shares in a recognised body with persons with an interest in the body, as defined in Clause 72

 

of the Bill.

 

Bridget Prentice

 

93

 

Schedule  16,  page  273,  line  3,  at end insert—

 

‘( )    

Where powers conferred by Part 2 of Schedule 1 to the 1974 Act are exercisable

 

in relation to a person within paragraph (a), (b) or (c) of sub-paragraph (3), they

 

continue to be so exercisable after the person has ceased to be a person within the

 

paragraph in question.’

 


 

 

Members’ explanatory statement

 

This amendment ensures that if a person to whom a notice requiring information is given ceases

 

after the notice is given to be a recognised body, or an employee or manager of, or person with an

 

interest in, the body, the enforcement powers will nonetheless remain available.

 

Bridget Prentice

 

94

 

Schedule  16,  page  273,  line  38,  at end insert—

 

            

‘After that paragraph insert—

 

“Disciplinary powers of the Society

 

14B(1)  

This paragraph applies where the Society is satisfied that a

 

recognised body, or a manager or employee of a recognised body,

 

has failed to comply with a requirement imposed by or by virtue of

 

this Act or any rules applicable to that person by virtue of section 9

 

of this Act.

 

      (2)  

The Society may do one or both of the following—

 

(a)    

give the person a written rebuke;

 

(b)    

direct the person to pay a penalty not exceeding £2,000.

 

      (3)  

The Society may publish details of any action it has taken under

 

sub-paragraph (2)(a) or (b), if it considers it to be in the public

 

interest to do so.


 
 

Public Bill Committee: 19th June 2007                  

377

 

Legal Services Bill-[Lords], continued

 
 

      (4)  

Where the Society takes action against a person under sub-

 

paragraph (2)(b), or decides to publish under sub-paragraph (3)

 

details of such action under sub-paragraph (2)(a) or (b), it must

 

notify the person in writing that it has done so.

 

      (5)  

A penalty imposed under sub-paragraph (2)(b) does not become

 

payable until—

 

(a)    

the end of the period during which an appeal against the

 

decision to impose the penalty, or the amount of the

 

penalty, may be made under paragraph 14C, or

 

(b)    

if such an appeal is made, such time as it is determined or

 

withdrawn.

 

      (6)  

The Society may not publish under sub-paragraph (3) details of any

 

action under sub-paragraph (2)(a) or (b)—

 

(a)    

during the period within which an appeal against—

 

(i)    

the decision to take the action,

 

(ii)    

in the case of action under sub-paragraph (2)(b),

 

the amount of the penalty, or

 

(iii)    

the decision to publish the details,

 

    

may be made under paragraph 14C, or

 

(b)    

if such an appeal has been made, until such time as it is

 

determined or withdrawn.

 

      (7)  

The Society must make rules—

 

(a)    

prescribing the circumstances in which the Society may

 

decide to take action under sub-paragraph (2)(a) or (b);

 

(b)    

about the practice and procedure to be followed by the

 

Society in relation to such action;

 

(c)    

governing the publication under sub-paragraph (3) of

 

details of action taken under sub-paragraph (2)(a) or (b);

 

            

and the Society may make such other rules in connection with the

 

exercise of its powers under this paragraph as it considers

 

appropriate.

 

      (8)  

Before making rules under sub-paragraph (7), the Society must

 

consult the Tribunal.

 

      (9)  

A penalty under this paragraph may be recovered as a debt due to

 

the Society, and is to be forfeited to Her Majesty.

 

    (10)  

The Lord Chancellor may, by order, amend paragraph (b) of sub-

 

paragraph (2) so as to substitute for the amount for the time being

 

specified in that paragraph such other amount as may be specified

 

in the order.

 

    (11)  

Before making an order under sub-paragraph (10), the Lord

 

Chancellor must consult the Society.

 

    (12)  

An order under sub-paragraph (10) is to be made by statutory

 

instrument subject to annulment in pursuance of a resolution of

 

either House of Parliament.

 

    (13)  

This paragraph is without prejudice to any power conferred on the

 

Society, or any other person, to make an application or complaint to

 

the Tribunal.


 
 

Public Bill Committee: 19th June 2007                  

378

 

Legal Services Bill-[Lords], continued

 
 

14C(1)  

A person may appeal against—

 

(a)    

a decision by the Society to rebuke that person under

 

paragraph 14B(2)(a) if a decision is also made to publish

 

details of the rebuke;

 

(b)    

a decision by the Society to impose a penalty on that person

 

under paragraph 14B(2)(b) or the amount of that penalty;

 

(c)    

a decision by the Society to publish under paragraph

 

14B(3) details of any action taken against that person under

 

paragraph 14B(2)(a) or (b).

 

      (2)  

Subsections (9)(b), (10)(a) and (b), (11) and (12) of section 46 of

 

the 1974 Act (Tribunal rules about procedure for hearings etc)

 

apply in relation to appeals under this paragraph as they apply in

 

relation to applications or complaints, except that subsection (11) of

 

that section is to be read as if for “the applicant” to “application)”

 

there were substituted “any party to the appeal”.

 

      (3)  

Rules under section 46(9)(b) of the 1974 Act may, in particular,

 

make provision about the period during which an appeal under this

 

paragraph may be made.

 

      (4)  

On an appeal under this paragraph, the Tribunal has power to make

 

an order which—

 

(a)    

affirms the decision of the Society;

 

(b)    

revokes the decision of the Society;

 

(c)    

in the case of a penalty imposed under paragraph

 

14B(2)(b), varies the amount of the penalty;

 

(d)    

in the case of a recognised body, contains provision for any

 

of the matters mentioned in paragraph 18(2);

 

(e)    

in the case of a manager or employee of a recognised body,

 

contains provision for any of the matters mentioned in

 

paragraph 18A(2);

 

(f)    

makes such provision as the Tribunal thinks fit as to

 

payment of costs.

 

      (5)  

Where, by virtue of sub-paragraph (4)(e), an order contains

 

provision for any of the matters mentioned in sub-paragraph (2)(c)

 

of paragraph 18A, sub-paragraphs (4) and (5) of that paragraph

 

apply as if the order had been made under sub-paragraph (2)(c) of

 

that paragraph.

 

      (6)  

An appeal from the Tribunal shall lie to the High Court, at the

 

instance of the Society or the person in respect of whom the order

 

of the Tribunal was made.

 

      (7)  

The High Court shall have power to make such order on an appeal

 

under this paragraph as it may think fit.

 

      (8)  

Any decision of the High Court on an appeal under this section shall

 

be final.

 

      (9)  

This paragraph is without prejudice to any power conferred on the

 

Tribunal in connection with an application or complaint made to

 

it.”’.

 

 

Members’ explanatory statement


 
 

Public Bill Committee: 19th June 2007                  

379

 

Legal Services Bill-[Lords], continued

 
 

This amendment inserts new paragraphs 14B and 14C into Schedule 2 to the Administration of

 

Justice Act 1985 which make similar provision for recognised bodies, their managers and employ­

 

ees to that made for solicitors by the new sections 44D and 44E of the Solicitors Act 1974 inserted

 

by amendment 78.

 

Bridget Prentice

 

95

 

Schedule  16,  page  275,  line  29,  after ‘solicitor’, insert ‘or employee of a solicitor’.

 

 

Members’ explanatory statement

 

This amendment, together with amendment 96, allows the Tribunal to make an order, on one or

 

more of the grounds set out in subsection (1), prohibiting an employee of a solicitor from employ­

 

ing or remunerating a person who is the subject of that order.

 

Bridget Prentice

 

96

 

Schedule  16,  page  275,  line  30,  leave out ‘his practice as a’ and insert ‘the practice

 

carried on by that’.

 

 

Members’ explanatory statement

 

This amendment, together with amendment 95, allows the Tribunal to make an order, on one or

 

more of the grounds set out in subsection (1), prohibiting an employee of a solicitor from employ­

 

ing or remunerating a person who is the subject of that order.

 

Bridget Prentice

 

197

 

Schedule  16,  page  275,  line  47,  at end insert—

 

      ‘()  

For this purpose a person has an interest in a body if the person has an interest

 

in the body within the meaning of Part 5 of the Legal Services Act 2007 (see

 

sections 72 and 109 of that Act).’.

 

 

Members’ explanatory statement

 

This amendment inserts a definition of “interest in the body”. The definition refers to the definition

 

of interest in a body in Clause 72 of the Bill.

 

Bridget Prentice

 

97

 

Schedule  16,  page  277,  line  2,  after ‘solicitor’, insert ‘or any employee of the

 

solicitor who is an authorised person’.

 

 

Members’ explanatory statement

 

This amendment is consequential upon amendment 85, which inserted a reference to employees

 

into section 56 of the Solicitors Act 1974.

 

Bridget Prentice

 

98

 

Schedule  16,  page  277,  line  23,  at end insert—

 

‘(4)    

A provision in the agreement that any manager of the body shall be

 

relieved from any responsibility to which the manager would

 

otherwise be subject in the course of the carrying on by the body of its

 

business as a recognised body shall be void.’.

 

 

Members’ explanatory statement

 

This amendment prohibits provision in a contentious business agreement relieving a recognised


 
 

Public Bill Committee: 19th June 2007                  

380

 

Legal Services Bill-[Lords], continued

 
 

body’s manager of responsibility.

 

Mr Jonathan Djanogly

 

Mr Henry Bellingham

 

Mr Tobias Ellwood

 

318

 

Parliamentary Star    

Schedule  16,  page  279,  line  8,  leave out sub-paragraph (3) and insert—

 

    ‘(3)  

For sub-paragraph (2)(c) substitute—

 

“(c)    

a relevant insolvency event occurs in relation to a recognised

 

body;

 

(ca)    

the Society has reason to suspect dishonesty on the part of any

 

manager of a recognised body; or”.’.

 

Bridget Prentice

 

99

 

Schedule  16,  page  280,  line  35,  leave out ‘or employee’.

 

 

Members’ explanatory statement

 

This amendment is consequential upon amendment 92.

 

Bridget Prentice

 

100

 

Schedule  16,  page  280,  line  37,  leave out ‘or employee’.

 

 

Members’ explanatory statement

 

This amendment is consequential upon amendment 92.

 

Mr Jonathan Djanogly

 

Mr Henry Bellingham

 

Mr Tobias Ellwood

 

319

 

Parliamentary Star    

Schedule  16,  page  281,  line  14,  leave out from ‘partnership’ to ‘and’ in line 15 and

 

insert—

 

    

‘or the business of a sole principal, to a former manager of the body

 

(within the meaning of Schedule 2 to the Administration of Justice Act

 

1985),’.

 

Bridget Prentice

 

101

 

Schedule  16,  page  281,  line  18,  after ‘etc)’, insert ‘—

 

(a)    

for sub-paragraph (1) substitute—

 

  “(1)  

Where a recognised body acts as such for a client, any

 

communication, document, material or information is

 

privileged from disclosure in like manner as if the

 

recognised body had at all material times been a solicitor

 

acting for the client.”, and

 

(b)    

’.

 

 

Members’ explanatory statement

 

This amendment provides that not only a “communication”, but also “a document, material or in­

 

formation”, is privileged in like manner as if the recognised body had been acting as the client’s

 

solicitor. It also deletes the reference to “legal proceedings”. These changes reflect developments


 
 

Public Bill Committee: 19th June 2007                  

381

 

Legal Services Bill-[Lords], continued

 
 

in the common law of legal professional privilege.

 


 

Bridget Prentice

 

198

 

Schedule  17,  page  295,  line  2,  leave out ‘of the persons within subsection (5)’ and

 

insert ‘director of the body’.

 

 

Members’ explanatory statement

 

This amendment adjusts the management and control condition in sub-paragraph (4) to provide

 

that at least one of the directors must be a licensed conveyancer. See also amendment 199.

 

Bridget Prentice

 

199

 

Schedule  17,  page  295,  leave out lines 4 to 6.

 

 

Members’ explanatory statement

 

This amendment is related to amendment 198, which adjusts the management and control condi­

 

tion such that sub-paragraph (5) is no longer necessary.

 

Bridget Prentice

 

200

 

Schedule  17,  page  295,  line  17,  after ‘managers’, insert ‘or employees’.

 

 

Members’ explanatory statement

 

This amendment alters the definition of “relevant legal services” to refer to employees who are

 

authorised persons, rather than just managers who are authorised persons.

 

Bridget Prentice

 

201

 

Schedule  17,  page  295,  line  23,  leave out ‘in shares’.

 

 

Members’ explanatory statement

 

This amendment is related to amendment 111. It adjusts the meaning of interest in a recognised

 

body to refer to the definition of interest in a body in Clause 72 of the Bill, rather than the former

 

“interest in shares” in a body.

 

Bridget Prentice

 

102

 

Schedule  17,  page  295,  line  26,  leave out from beginning to ‘does’ in line 28 and

 

insert—

 

‘22      

For section 33 (legal professional privilege) substitute—

 

“33    

Legal professional privilege

 

(1)    

Subsection (2) applies where a licensed conveyancer or recognised

 

body acts as such for a client.

 

(2)    

Any communication, document, material or information is privileged

 

from disclosure in like manner as if the licensed conveyancer or body

 

had at all material times been acting as the client’s solicitor.

 

(3)    

This section”.’.


 
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