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Public Bill Committee: 14th June 2007                  

278

 

Legal Services Bill [Lords], continued

 
 

“Disciplinary powers of the Society

 

44D    

Disciplinary powers of the Society

 

(1)    

This section applies where the Society is satisfied—

 

(a)    

that a solicitor or an employee of a solicitor has failed to

 

comply with a requirement imposed by or by virtue of this Act

 

or any rules made by the Society, or

 

(b)    

that there has been professional misconduct by a solicitor.

 

(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

 

subsection (2)(a) or (b), if it considers it to be in the public interest to

 

do so.

 

(4)    

Where the Society takes action against a person under subsection

 

(2)(b), or decides to publish under subsection (3) details of any action

 

taken under subsection (2)(a) or (b), it must notify the person in

 

writing that it has done so.

 

(5)    

A penalty imposed under subsection (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 section 44E, or

 

(b)    

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

 

withdrawn.

 

(6)    

The Society may not publish under subsection (3) details of any action

 

under subsection (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 subsection (2)(b), the

 

amount of the penalty, or

 

(iii)    

the decision to publish the details,

 

    

may be made under section 44E, 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determined or withdrawn.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 subsection (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 subsection (3) of details of

 

action taken under subsection (2)(a) or (b);

 

    

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

 

exercise of its powers under this section as it considers appropriate.

 

(8)    

Before making rules under subsection (7), the Society must consult the

 

Tribunal.

 

(9)    

A penalty payable under this section may be recovered as a debt due

 

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


 
 

Public Bill Committee: 14th June 2007                  

279

 

Legal Services Bill [Lords], continued

 
 

(10)    

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

 

subsection (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 subsection (10), the Lord Chancellor

 

must consult the Society.

 

(12)    

An order under subsection (10) is to be made by statutory instrument

 

subject to annulment in pursuance of a resolution of either House of

 

Parliament.

 

(13)    

This section is without prejudice to any power conferred on the

 

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

 

Tribunal.

 

44E    

Appeals against disciplinary action under section 44D

 

(1)    

A person may appeal against—

 

(a)    

a decision by the Society to rebuke that person under section

 

44D(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 section 44D(2)(b) or the amount of that penalty;

 

(c)    

a decision by the Society to publish under section 44D(3)

 

details of any action taken against that person under section

 

44D(2)(a) or (b).

 

(2)    

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

 

(Tribunal rules about procedure for hearings etc) apply in relation to

 

appeals under this section 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) may, in particular, make provision about

 

the period during which an appeal under this section may be made.

 

(4)    

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

 

order as it thinks fit, and such an order may in particular—

 

(a)    

affirm the decision of the Society;

 

(b)    

revoke the decision of the Society;

 

(c)    

in the case of a penalty imposed under section 44D(2)(b), vary

 

the amount of the penalty;

 

(d)    

in the case of a solicitor, contain provision for any of the

 

matters mentioned in paragraphs (a) to (d) of section 47(2);

 

(e)    

in the case of an employee of a solicitor, contain provision for

 

any of the matters mentioned in section 47(2E);

 

(f)    

make such provision as the Tribunal thinks fit as to payment

 

of costs.

 

(5)    

Where by virtue of subsection (4)(e) an order contains provision for

 

any of the matters mentioned in section 47(2E)(c), section 47(2F) and

 

(2G) apply as if the order had been made under section 47(2E)(c).

 

(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.


 
 

Public Bill Committee: 14th June 2007                  

280

 

Legal Services Bill [Lords], continued

 
 

(7)    

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

 

under this section as it may think fit.

 

(8)    

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

 

be final.

 

(9)    

This section is without prejudice to any power conferred on the

 

Tribunal in connection with an application or complaint made to it.”’.

 


 

 

Members’ explanatory statement

 

This amendment inserts new sections 44D and 44E into the Solicitors Act 1974 establishing a pro­

 

cedure that allows the Law Society to rebuke or fine a solicitor where he has breached a require­

 

ment of that Act or any rules made by the Society, or been found to have committed professional

 

misconduct.

 

Bridget Prentice

 

79

 

Schedule  16,  page  249,  line  34,  at end insert—

 

‘( )    

in subsection (1), after paragraph (e) insert—

 

“(ea)    

by a solicitor who has been suspended from practice

 

as a sole solicitor for an unspecified period, by order

 

of the Tribunal, for the termination of that

 

suspension;”,

 

( )    

in subsection (2) for “subsection” (where it first occurs) substitute

 

“subsections (2E) and”,

 

( )    

after subsection (2)(b) insert—

 

“(ba)    

the revocation of that solicitor’s sole solicitor

 

endorsement (if any);

 

(bb)    

the suspension of that solicitor from practice as a sole

 

solicitor indefinitely or for a specified period;”,’.

 


 

 

Members’ explanatory statement

 

This amendment allows a solicitor to apply to the Tribunal for a termination of a suspension pre­

 

viously ordered by the Tribunal. This amendment also provides that on an application or com­

 

plaint under the Act, the Tribunal may revoke a sole solicitor endorsement, or suspend a solicitor

 

from sole practice.

 

Bridget Prentice

 

80

 

Schedule  16,  page  249,  line  35,  after ‘£5,000”,’ insert—

 

‘( )    

after subsection (2)(e) insert—

 

“(ea)    

the termination of that solicitor’s unspecified period

 

of suspension from practice as a sole solicitor;”,

 

( )    

after subsection (2D) insert—

 

“(2E)    

On the hearing of any complaint made to the Tribunal by

 

virtue of section 34A(2) or (3), the Tribunal shall have power

 

to make one or more of the following—

 

(a)    

an order directing the payment by the employee to

 

whom the complaint relates of a penalty to be

 

forfeited to Her Majesty;


 
 

Public Bill Committee: 14th June 2007                  

281

 

Legal Services Bill [Lords], continued

 
 

(b)    

an order requiring the Society to consider taking such

 

steps as the Tribunal may specify in relation to that

 

employee;

 

(c)    

if that employee is not a solicitor, an order which

 

states one or more of the matters mentioned in

 

paragraphs (a) to (c) of section 43(2);

 

(d)    

an order requiring the Society to refer to an

 

appropriate regulator any matter relating to the

 

conduct of that employee.

 

(2F)    

Subsections (1) to (1C), (3) and (4) of section 44 apply in

 

relation to an order under subsection (2E)(c) as they apply in

 

relation to an order under section 43(2).

 

(2G)    

Section 44(2), paragraph 16(1)(d) and (1A)(d) of Schedule 2

 

to the Administration of Justice Act 1985 and paragraph

 

15(3A) of Schedule 14 to the Courts and Legal Services Act

 

1990 apply in relation to an order under subsection (2E)(c) as

 

they apply in relation to an order under section 43(2).

 

(2H)    

For the purposes of subsection (2E)(d) an “appropriate

 

regulator” in relation to an employee means—

 

(a)    

if the employee is an authorised person in relation to

 

a reserved legal activity (within the meaning of the

 

Legal Services Act 2007), any relevant approved

 

regulator (within the meaning of that Act) in relation

 

to that employee, and

 

(b)    

if the employee carries on activities which are not

 

reserved legal activities (within the meaning of that

 

Act), any body which regulates the carrying on of

 

such activities by the employee.”,’.

 


 

 

Members’ explanatory statement

 

This amendment provides the Tribunal with certain order powers to accompany new application

 

and complaints powers in relation to sole solicitor endorsements. This amendment also adapts the

 

application of certain statutory provisions for such orders.

 

Bridget Prentice

 

81

 

Schedule  16,  page  249,  line  41,  after ‘Tribunal)’, insert—

 

‘(a)    

in subsection (2)(b)—

 

(i)    

after “(e),” insert “(ea),”, and

 

(ii)    

omit “in the London Gazette”, and

 

(b)    

’.

 


 

 

Members’ explanatory statement

 

This amendment provides that the obligation for the Law Society to publish certain Tribunal orders

 

under section 47 extends to decisions to suspend or revoke sole solicitor endorsements. It also

 

omits the specific need to publish section 47 decisions in the London Gazette.


 
 

Public Bill Committee: 14th June 2007                  

282

 

Legal Services Bill [Lords], continued

 
 

Bridget Prentice

 

82

 

Schedule  16,  page  249,  line  42,  at end insert ‘, and

 

(c)    

after subsection (4) insert—

 

“(5)    

In the case of orders of the Tribunal under section 44E, the

 

reference in subsection (2)(a) to the application or complaint

 

is to be read as a reference to the Tribunal’s order.”’.

 

 

Members’ explanatory statement

 

This amendment adds a new subsection (5) to section 48 of the Solicitors Act 1974. The subsection

 

ensures that a note of a Tribunal order under new section 44E is entered on the solicitor’s roll.

 

Bridget Prentice

 

83

 

Schedule  16,  page  250,  line  13,  after ‘(e)’, insert ‘, (ea)’.

 

 

Members’ explanatory statement

 

This amendment is related to amendment 79. It ensures that any decision of the High Court in re­

 

lation to an appeal from a Tribunal order terminating a person’s suspension from sole practice

 

shall be final.

 

Bridget Prentice

 

84

 

Schedule  16,  page  251,  line  20,  after ‘(5)’, insert ‘—

 

(a)    

’.

 

 

Members’ explanatory statement

 

This is a paving amendment for amendment 85.

 

Bridget Prentice

 

85

 

Schedule  16,  page  251,  line  23,  at end insert ‘, and

 

(b)    

in paragraph (d) after “solicitor” insert “, or any employee of his who

 

is an authorised person,”.

 

      ()  

After that subsection insert—

 

“(5A)    

In subsection (5) “authorised person” means a person who is an

 

authorised person in relation to an activity which is a reserved legal

 

activity, within the meaning of the Legal Services Act 2007 (see

 

section 18 of that Act).”’.

 


 

 

Members’ explanatory statement

 

This amendment provides that orders made under section 56 to regulate remuneration of solicitors

 

for non-contentious business may take into account the skill, labour and responsibility that the

 

business in question requires not only of solicitors, but also of employees of solicitors who are au­

 

thorised persons.


 
 

Public Bill Committee: 14th June 2007                  

283

 

Legal Services Bill [Lords], continued

 
 

Bridget Prentice

 

86

 

Schedule  16,  page  251,  line  43,   leave out ‘negligence’ and insert ‘his negligence,

 

or that of any employee of his,’.

 

 

Members’ explanatory statement

 

This amends a prohibition on provisions in contentious agreements relieving a solicitor of respon­

 

sibility for negligence, so that it also catches such provisions about the negligence of the solicitor’s

 

employees.

 

Bridget Prentice

 

87

 

Schedule  16,  page  252,  line  27,  at end insert ‘, and

 

(iii)    

after “solicitor” (in the third place) insert “, or any of his

 

employees,’.

 


 

 

Members’ explanatory statement

 

This amendment provides that an assessment by a costs officer of the remuneration due to a solic­

 

itor in respect of previous work may take into account any default, negligence, delay or improper

 

conduct on the part of a solicitor’s employees.

 

Bridget Prentice

 

88

 

Schedule  16,  page  252,  line  39,  at end insert—

 

‘(d)    

in paragraph (a), after “solicitor” insert “or an employee of the

 

solicitor”, and

 

(e)    

in paragraph (b), after “him” insert “or by any employee of his who is

 

an authorised person (within the meaning of section 56(5A))”.’.

 


 

 

Members’ explanatory statement

 

This amendment provides that on an assessment of costs in respect of any contentious business, the

 

costs officer may, in determining the remuneration of the solicitor, take into account the skill, la­

 

bour and responsibility of not only the solicitor, but also employees of the solicitor who are au­

 

thorised persons.

 

Bridget Prentice

 

89

 

Schedule  16,  page  257,  line  21,  after ‘32(1)(a)”,’ insert—

 

‘( )    

after the definition of “sole solicitor” insert—

 

““sole solicitor endorsement” has the same meaning as in section

 

1B;”’.

 


 

 

Members’ explanatory statement

 

This amendment adds a definition of “sole solicitor endorsement” to the interpretation provisions.

 

Bridget Prentice

 

90

 

Schedule  16,  page  257,  line  35,  at end insert—

 

‘( )    

after “trustee” insert “or that employee is or was a trustee in

 

his capacity as such an employee”,’.

 



 
 

Public Bill Committee: 14th June 2007                  

284

 

Legal Services Bill [Lords], continued

 
 

 

Members’ explanatory statement

 

This amendment extends the circumstances in which the Law Society may intervene in a solicitor’s

 

practice to cover suspected dishonesty in connection with any trust of which an employee of that

 

solicitor is or was a trustee in his capacity as an employee.

 

Bridget Prentice

 

91

 

Schedule  16,  page  258,  line  33,  leave out paragraph (b) and insert—

 

‘(b)    

for paragraph (a) substitute—

 

“(a)    

the Society is satisfied that there has been undue

 

delay—

 

(i)    

on the part of a solicitor in connection with

 

any matter in which the solicitor or his

 

firm is or was acting on behalf of a client

 

or with any trust, or

 

(ii)    

on the part of an employee of a solicitor in

 

connection with any trust of which the

 

employee is or was a trustee in his capacity

 

as such an employee; and”,’.

 


 

 

Members’ explanatory statement

 

This amendment extends the circumstances in which the Law Society may intervene in a solicitor’s

 

practice to cover undue delay in connection with any trust of which an employee of that solicitor

 

is or was a trustee in his capacity as an employee.

 

Bridget Prentice

 

92

 

Schedule  16,  page  259,  line  1,  leave out paragraph (b) and insert—

 

‘(b)    

in sub-paragraph (2)(a) for “his practice” to the end substitute—

 

“(i)    

his practice or former practice,

 

(ii)    

any trust of which he is or formerly was a

 

trustee, or

 

(iii)    

any trust of which a person who is or was

 

an employee of the solicitor is or was a

 

trustee in the person’s capacity as such an

 

employee;”, and’.

 


 

 

Members’ explanatory statement

 

This amendment extends the powers of the Law Society following intervention. Under paragraph

 

6 of Schedule 1 to the Solicitors Act 1974, sums of money can now vest in the Law Society where

 

they are held by or on behalf of the solicitor in connection with the situations set out in this amend­

 

ment.


 
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