House of Commons Public Bill Committee Proceedings

House of Commons

Session 2006 - 07
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Other Bills before Parliament

Public Bill Committee Proceedings: 26th June 2007
51

Legal Services Bill-[Lords], continued

(a)
contain any such provision as is referred to in section 33(1),

and

(b)
have effect in relation to employees of solicitors by virtue of

section 34A(1).

(3)
Except as provided by the rules, an employee to whom the rules are

applied is not liable to account to any client, other person or trust for

interest received by the employee on money held at a bank or building

society in an account which is for money received or held for, or on

account of—

(a)
clients of the solicitor, other persons or trusts, generally, or

(b)
that client, person or trust, separately.

(4)
Subsection (5) applies where rules made under section 33A(1) have

effect in relation to employees of solicitors by virtue of section

34A(1).

(5)
The Society may disclose a report on or information about the

accounts of any employee of a solicitor obtained in pursuance of such

rules for use—

(a)
in investigating the possible commission of an offence by the

solicitor or any employees of the solicitor, and

(b)
in connection with any prosecution of the solicitor or any

employees of the solicitor consequent on the investigation.

(6)
Where rules made under section 34 have effect in relation to

employees of solicitors by virtue of subsection (1), section 34(9) and

(10) apply in relation to such an employee as they apply in relation to

a solicitor.”’.

Bridget Prentice

Agreed to  65

Schedule  16,  page  242,  line  45,  at end insert—

‘(ia)
no employee of a solicitor shall employ or

remunerate, in connection with the solicitor’s

practice, the person with respect to whom the order is

made,’.

Bridget Prentice

Agreed to  185

Schedule  16,  page  243,  line  45,  leave out ‘in shares’.

Bridget Prentice

Agreed to  66

Schedule  16,  page  244,  line  6,  after ‘solicitor’, insert ‘, or an employee of a

solicitor,’.

Bridget Prentice

Agreed to  67

Schedule  16,  page  244,  line  8,  after ‘solicitor’, insert ‘or employee’.

Public Bill Committee Proceedings: 26th June 2007
52

Legal Services Bill-[Lords], continued

Bridget Prentice

Agreed to  186

Schedule  16,  page  244,  line  38,  leave out ‘in shares’.

Bridget Prentice

Agreed to  187

Schedule  16,  page  245,  line  5,  leave out ‘in shares’.

Bridget Prentice

Agreed to  68

Schedule  16,  page  245,  line  11,  after ‘solicitor’, insert ‘or an employee of a

solicitor’.

Bridget Prentice

Agreed to  69

Schedule  16,  page  245,  line  38,  after ‘purpose’, insert ‘—

(a)
’.

Bridget Prentice

Agreed to  70

Schedule  16,  page  245,  line  49,  at end insert ‘, and

(b)
the reference to the solicitor or his personal representative in paragraph

13 of that Schedule is to be construed as a reference to the person to

whom the notice was given under this section.”’.

Bridget Prentice

Agreed to  71

Schedule  16,  page  246,  line  15,  leave out ‘reference’ and insert ‘references’.

Bridget Prentice

Agreed to  72

Schedule  16,  page  246,  line  15,  after ‘9(5)’, insert ‘and (6)’.

Bridget Prentice

Agreed to  73

Schedule  16,  page  246,  line  22,  at end insert—

‘(7A)
Where powers conferred by Part 2 of Schedule 1 to the 1974 Act are exercisable

in relation to a person within paragraph (a), (b), (c) or (d) of subsection (2), they

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

paragraph in question.’.

Bridget Prentice

Agreed to  188

Schedule  16,  page  246,  line  28,  leave out ‘in shares’.

Public Bill Committee Proceedings: 26th June 2007
53

Legal Services Bill-[Lords], continued

Bridget Prentice

Agreed to  74

Schedule  16,  page  246,  line  41,  after ‘purpose’, insert ‘—

(a)
’.

Bridget Prentice

Agreed to  75

Schedule  16,  page  247,  line  2,  at end insert ‘, and

(b)
the reference to the solicitor or his personal representative in

paragraph 13 of that Schedule is to be construed as a reference to the

person to whom the notice was given under this section.”’.

Bridget Prentice

Agreed to  76

Schedule  16,  page  247,  line  36,  at end insert ‘, and

(c)
the reference to the solicitor or his personal representative in

paragraph 13 of that Schedule is to be construed as a reference to the

person to whom the notice was given under this section.’.

Bridget Prentice

Agreed to  77

Schedule  16,  page  248,  line  39,  at end insert—

‘(5)
This section (other than subsection (2)(a)) applies in relation to an

employee of a solicitor as it applies in relation to a solicitor.’.

Bridget Prentice

Agreed to  78

Schedule  16,  page  248,  line  39,  at end insert—


‘After that section insert—

“Disciplinary powers of the Society

44D
Disciplinary powers of the Society

(1)
This section applies where the Society is satisfied—
5
(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—
10
(a)
give the person a written rebuke;

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

Public Bill Committee Proceedings: 26th June 2007
54

Legal Services Bill-[Lords], continued

(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.
15
(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
20
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
25
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,
30
(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
35
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
40
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.
45
(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.

(10)
The Lord Chancellor may, by order, amend paragraph (b) of
50
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.
55
(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.

Public Bill Committee Proceedings: 26th June 2007
55

Legal Services Bill-[Lords], continued

(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
60
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
65
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
70
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
75
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
80
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;
85
(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
90
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
95
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 section as it may think fit.

(8)
Any decision of the High Court on an appeal under this section shall

be final.
100
(9)
This section is without prejudice to any power conferred on the

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

Public Bill Committee Proceedings: 26th June 2007
56

Legal Services Bill-[Lords], continued

As Amendments to Bridget Prentice’s proposed Amendment (No. 78):—

John Mann

Not moved  (a)

Line  12,  Leave out lines 12 to 14 and insert—

    ‘(3)
The Society may publish details of any action it has taken under subsection

(2)(a) or (b), unless it considers that it is not in the public interest to do so.’.

John Mann

Not called  (b)

Line  81,  at end insert—

‘( )
vary the decision of the Society;’.

Mr Jonathan Djanogly

Mr Henry Bellingham

Mr Tobias Ellwood

Not called  309

Schedule  16,  page  248,  line  39,  at end insert—

‘(2)
After that section insert—

“44F
Power for Society to rebuke and reprimand

(1)
Where the Society has investigated whether there has been professional

misconduct by a solicitor, or whether a solicitor has failed to comply with

any requirement imposed by or by virtue of this Act or any rules made by

the Society, and the Society is satisfied that there was professional

misconduct on the part of the solicitor, or that the solicitor did fail to

comply with such a requirement or rule, but the Society is not satisfied

that it is in the public interest to make a complaint against the solicitor to

the Tribunal, the Society may rebuke or reprimand the solicitor and,

unless it considers that it is not in the public interest to do so, may make

public both the fact that the solicitor has been rebuked or reprimanded

and a summary of the misconduct or failure concerned.

(2)
The Society may make rules providing for rights of appeal to the Tribunal

against rebukes or reprimands made by the Society where they are made,

or proposed to be made, public or in such other circumstances as the

Society may prescribe.

(3)
Rules made under subsection (2) may also make provision about the

procedure and practice to be followed in relation to—

(a)
investigations as to whether there has been professional

misconduct by a solicitor, or whether a solicitor has failed to

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

or any rules made by the Council;

(b)
the making of rebukes and reprimands; and

(c)
the making public of rebukes and reprimands under subsection

(1).’.

Bridget Prentice

Agreed to  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

Public Bill Committee Proceedings: 26th June 2007
57

Legal Services Bill-[Lords], continued

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;”,’.

Bridget Prentice

Agreed to  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;

(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