Legal Services Bill [HL]

House of Commons

Session 2006 - 07
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Legal Services Bill [HL]

Legal Services Bill [HL]
Schedule 16 — The Law Society, solicitors, recognised bodies and foreign lawyers
Part 1 — The Solicitors Act 1974 (c. 47)
250

are to be construed as references to the person to whom the
notice was given under this section, and
(d)
the reference in paragraph 9(12) of that Schedule to the
Society is to be construed as including a reference to a person
specified under subsection (4)(c).
5
(8)
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.
(9)
In this section—
10
“manager” has the same meaning as in the Legal Services Act
2007 (see section 207 of that Act);
“recognised body” means a body recognised under section 9 of
the Administration of Justice Act 1985;

and the reference to a person who has an interest in a recognised
15
body is to be construed in accordance with sections 72 and 109 of the
Legal Services Act 2007.
44BA
Power to require explanation of document or information
(1)
The Society may, by notice, require a person to whom a notice is
given under section 44B (or a representative of the person) to attend
20
at a time and place specified in the notice to provide an explanation
of any information provided or document produced pursuant to the
notice.
(2)
The Society may pay to any person such reasonable costs as may be
incurred by that person in connection with that person’s compliance
25
with a requirement imposed under subsection (1).
(3)
Paragraphs 9(3) and (4) and 13, 15 and 16 of Schedule 1 apply in
relation to a notice under this section, except that for this purpose—
(a)
paragraph 9 of that Schedule has effect as if—
(i)
in sub-paragraph (3) for “having” to “sub-paragraph
30
(1)” there were substituted “refuses, neglects or
otherwise fails to comply with a requirement under
section 44BA(1)”, and
(ii)
in sub-paragraph (4) for “produce” (in the first place)
to the end there were substituted “provide an
35
explanation of any information provided or
document produced pursuant to a notice under
section 44B (or a representative of such a person) to
attend at a time and place specified in the order to
provide an explanation of any information so
40
provided or document so produced.”, 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.
45
44BB
Provision of information and documents by other persons
(1)
The High Court, on the application of the Society, may order a
person to whom section 44B does not apply—

Legal Services Bill [HL]
Schedule 16 — The Law Society, solicitors, recognised bodies and foreign lawyers
Part 1 — The Solicitors Act 1974 (c. 47)
251

(a)
to provide information, or information of a description,
specified in the notice, or
(b)
to produce documents, or documents of a description,
specified in the notice.
(2)
The High Court may make an order under this section only if it is
5
satisfied—
(a)
that it is likely that the information or document is in the
possession or custody of, or under the control of, the person,
and
(b)
that there is reasonable cause to believe that the information
10
or document is likely to be of material significance to an
investigation into any of the matters mentioned in section
44B(3)(a) to (d).
(3)
An order under this section may direct the Society to pay to a person
specified in the order such reasonable costs as may be incurred by
15
that person in connection with the provision of any information, or
production of any document, by that person pursuant to the order.
(4)
Section 44B(4) applies in relation to an order under this section as it
applies in relation to a notice under section 44B.
(5)
Paragraphs 9(5A) and (7) to (12), 12, 13, 15 and 16 of Schedule 1 apply
20
in relation to an order under this section as they apply in relation to
an order under paragraph 9(4) of that Schedule, except that for this
purpose—
(a)
the reference to the solicitor or personal representative in
paragraph 9(7) of that Schedule is to be construed as a
25
reference to the person in respect of whom the order under
this section is made,
(b)
the reference in paragraph 9(12) of that Schedule to the
Society is to be read as including a reference to a person
specified under section 44B(4)(c) (as applied by subsection (4)
30
of this section), 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.
35
44BC
Information offences
(1)
It is an offence for a person who knows or suspects an investigation
into any of the matters mentioned in section 44B(3)(a) to (d) is being
or is likely to be conducted—
(a)
to falsify, conceal, destroy or otherwise dispose of a
40
document which the person knows or suspects is or would be
relevant to the investigation, or
(b)
to cause or permit the falsification, concealment, destruction
or disposal of such a document.
(2)
In proceedings for an offence under subsection (1) it is a defence for
45
the accused to show that the accused had no intention of concealing
facts disclosed by the documents from the person conducting the
investigation.

Legal Services Bill [HL]
Schedule 16 — The Law Society, solicitors, recognised bodies and foreign lawyers
Part 1 — The Solicitors Act 1974 (c. 47)
252

(3)
It is an offence for a person, in purported compliance with a
requirement imposed on the person under section 44B, 44BA or
44BB—
(a)
to provide information which the person knows to be false or
misleading in a material particular, or
5
(b)
recklessly to provide information which is false or
misleading in a material particular.
(4)
A person who is guilty of an offence under subsection (1) or (3) is
liable—
(a)
on summary conviction, to imprisonment for a term not
10
exceeding 12 months or a fine not exceeding the statutory
maximum, or both;
(b)
on conviction on indictment, to imprisonment for term not
exceeding 2 years or a fine, or both.
(5)
In relation to an offence under subsection (1) or (3) committed before
15
the commencement of section 154(1) of the Criminal Justice Act 2003
the reference in subsection (4)(a) to 12 months is to be read as a
reference to 6 months.”
45
For section 44C (payment of costs of investigations) substitute—
“44C
Power to charge for costs of investigations
20
(1)
The Society may make regulations prescribing charges to be paid to
the Society by solicitors who are the subject of a discipline
investigation.
(2)
A “discipline investigation” is an investigation carried out by the
Society into—
25
(a)
possible professional misconduct by a solicitor, or
(b)
a failure or apprehended failure by a solicitor to comply with
any requirement imposed by or by virtue of this Act or any
rules made by the Society.
(3)
Regulations under this section may—
30
(a)
make different provision for different cases or purposes;
(b)
provide for the whole or part of a charge payable under the
regulations to be repaid in such circumstances as may be
prescribed by the regulations.
(4)
Any charge which a solicitor is required to pay under regulations
35
under this section is recoverable by the Society as a debt due to the
Society from the solicitor.
(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.”
46
After that section insert—
40
“Disciplinary powers of the Society
44D
Disciplinary powers of the Society
(1)
This section applies where the Society is satisfied—

Legal Services Bill [HL]
Schedule 16 — The Law Society, solicitors, recognised bodies and foreign lawyers
Part 1 — The Solicitors Act 1974 (c. 47)
253

(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—
5
(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.
10
(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
15
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
20
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,
25
(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
30
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
35
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.
40
(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
45
subsection (2) so as to substitute for the amount for the time being

Legal Services Bill [HL]
Schedule 16 — The Law Society, solicitors, recognised bodies and foreign lawyers
Part 1 — The Solicitors Act 1974 (c. 47)
254

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
5
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.
10
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;
15
(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).
20
(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
25
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
30
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;
35
(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
40
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
45
instance of the Society or the person in respect of whom the order of
the Tribunal was made.

Legal Services Bill [HL]
Schedule 16 — The Law Society, solicitors, recognised bodies and foreign lawyers
Part 1 — The Solicitors Act 1974 (c. 47)
255

(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
5
Tribunal in connection with an application or complaint made to it.”
47    (1)
Section 46 (solicitors disciplinary tribunal) is amended as follows.
      (2)
For subsection (5) substitute—
“(5)
The Tribunal may pay its members such remuneration, fees or
allowances as it may determine with the approval of the Legal
10
Services Board.”
      (3)
After that subsection insert—
“(5A)
The Tribunal may do anything calculated to facilitate, or incidental
or conducive to, the carrying out of any of its functions.”
      (4)
Omit subsections (6) to (8).
15
      (5)
In subsection (9)—
(a)
for “Subject to subsections (6) to (8), the” substitute “The”,
(b)
omit “, with the concurrence of the Master of the Rolls,”, and
(c)
in paragraph (b) after “complaints” insert “(including provision
about the composition of the Tribunal)”.
20
48
After that section insert—
“46A
Funding of the Tribunal
(1)
The Tribunal must submit to the Society in respect of each year a
budget for the year approved by the Legal Services Board.
(2)
A budget for a year is a statement of the amount of money which the
25
Tribunal estimates is required to enable it to meet all of its
expenditure in that year (having regard to any amounts received but
not spent in previous years).
(3)
Before approving a statement for the purposes of subsection (1) the
Legal Services Board must consult the Society.
30
(4)
The budget for a year must be submitted to the Society under
subsection (1) no later than the date in the preceding year specified
by the Society for the purposes of this subsection.
(5)
Before specifying a date for this purpose the Society must consult the
Tribunal.
35
(6)
The amount specified in a budget submitted under subsection (1)
must be paid by the Society to the Tribunal—
(a)
in such instalments and at such times as may be agreed
between the Society and the Tribunal, or
(b)
in the absence of such agreement, before the beginning of the
40
year to which the budget relates.

Legal Services Bill [HL]
Schedule 16 — The Law Society, solicitors, recognised bodies and foreign lawyers
Part 1 — The Solicitors Act 1974 (c. 47)
256

(7)
The Society may pay the Tribunal such other amounts as the Society
considers appropriate.
(8)
In this section “year” means a calendar year.”
49
In section 47 (jurisdiction and powers of Tribunal)—
(a)
in subsection (1), after paragraph (e) insert—
5
“(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;”,
(b)
in subsection (2) for “subsection” (where it first occurs) substitute
10
“subsections (2E) and”,
(c)
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
15
solicitor indefinitely or for a specified period;”,
(d)
in subsection (2)(c) omit “not exceeding £5,000”,
(e)
after subsection (2)(e) insert—
“(ea)
the termination of that solicitor’s unspecified period
of suspension from practice as a sole solicitor;”,
20
(f)
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
25
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;
30
(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
35
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
40
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
45
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