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Amendments made: No. 87, in page 59, line 22, leave out ‘non-authorised persons’ and insert ‘within subsection (3A)’.
No. 88, page 59, line 24, leave out ‘non-authorised persons’ and insert ‘persons within subsection (3A)’.
No. 89, page 59, line 26, leave out ‘non-authorised’ and insert ‘such’.
No. 90, page 59, line 29, leave out ‘non-authorised’ and insert ‘such’.
No. 91, page 59, line 31, leave out ‘non-authorised’ and insert ‘such’.
No. 92, page 59, line 33, at end insert—
‘(3A) The persons within this subsection are—
(b) licensed bodies.’.— [Bridget Prentice.]
Amendment made: No. 107, page 214, line 3, at end insert—
‘( ) that a person has been appointed receiver or manager of property of the licensed body;’.— [Bridget Prentice.]
Mr. Bellingham: I beg to move amendment No. 153, page 68, line 37, leave out ‘may’ and insert ‘must’.
Mr. Deputy Speaker: With this it will be convenient to discuss the following amendments:
No. 154, page 68, line 41, leave out from ‘circumstances’ to end of line 43 and insert
‘to another body with a view to it being determined by that body instead of by an ombudsman, with particular regard to—
(i) mixed complaints provided by authorised persons under any part of this Act;
(ii) whether determination of the complaint by a body other than the ombudsman will be unduly prejudicial to the complainant or authorised person;
(iii) provisions for managing a complainant’s dissatisfaction regarding the determination of the complaint referred to another body under this subsection.’.
No. 56, page 69, line 14, at end insert—
‘(ha) for an ombudsman to award costs against the respondent in favour of the OLC for the purpose of providing a contribution to resources deployed in dealing with the complaint if—
(i) the complaint against the respondent is determined or otherwise resolved substantially in favour of the complainant, or
(ii) in the ombudsman’s opinion the respondent failed to deal with the complaint in accordance with the regulatory arrangements which the relevant approved regulator has made under section 112’.
No. 57, in clause 136, line 48, after ‘(3)(h)’, insert ‘, (ha),’.
Government amendment No. 93, page 70, line 43, at end insert—
‘(1A) The rules must provide for charges payable in relation to a complaint to be reduced or waived (or partly or wholly refunded) where—
(a) the complaint is determined or otherwise resolved in favour of the respondent, and
(b) the ombudsman is satisfied that the respondent took all reasonable steps to try to resolve the complaint under the respondent’s complaints procedures.
(1B) The rules may make provision as to—
(a) the circumstances in which a complaint is to be treated as determined or otherwise resolved in favour of the respondent (which may include circumstances where a complaint is settled, withdrawn or abandoned (or treated as withdrawn or abandoned by virtue of scheme rules));
(b) matters to be taken into account by the ombudsman for the purposes of subsection (1A)(b).
(1C) The respondent’s complaints procedures are the procedures established by the respondent, or which the respondent participates in or is subject to, in accordance with regulatory arrangements (or licensing rules of the Board) made in accordance with section 112.’.
Amendment (a) thereto, in line 2, leave out ‘reduced or’.
Amendment (b) thereto, in line 2, leave out ‘or partly’.
No. 58, page 70, line 43, at end insert—
‘(1A) The rules must provide for the OLC to reduce or waive a charge in circumstances where—
(a) the complaint relates to activity undertaken otherwise than for reward, or
(b) it appears to the OLC that the amount of a charge, unless reduced or waived, would be disproportionate having regard to the gravity or nature of the complaint, the value (if any) of the subject matter of the activity to which it relates, or the consideration payable for the services used by the complainant which consist of or include that activity, or
(c) it appears to the OLC that the amount of a charge, unless reduced or waived, would cause the respondent undue hardship.
(1B) The rules must also provide for the refund of the whole or part of a charge where circumstances coming to the OLC’s attention since the charge was paid are such that it appears to the OLC that the amount of the charge, unless wholly or partly refunded—
(a) is disproportionate having regard to the gravity or nature of the complaint, the value (if any) of the subject matter of the activity to which it relates, or the consideration payable for the services used by the complainant which consist of or include that activity, or
(b) causes the respondent undue hardship.
(1C) Scheme rules must provide that any charge in relation to a complaint shall not become payable by a respondent unless the complaint is determined or otherwise resolved substantially in favour of the complainant.’.
No. 59, page 71, line 2, after ‘case’, insert
‘(other than one to which rules pursuant to subsection (1A) apply)’.
No. 60, page 71, line 5, after ‘circumstances’, insert
‘(other than circumstances in which rules pursuant to subsection (1B) apply)’.
No. 76, in clause 138, page 72, line 15, leave out ‘£20,000’ and insert ‘£50,000’.
No. 145, page 72, line 15, at end insert
‘or a higher sum which the Lord Chancellor may by order prescribe.’.
No. 77, page 72 , leave out lines 22 to 24.
No. 72, in clause 140, page 73, line 42, at end insert—
‘(10A) Where a determination has become final and binding in accordance with this section, the complainant may appeal to the High Court against the determination, the terms of any direction made under section 137(2), or any omission to make such a direction.’.
No. 73, page 73, line 42, at end insert—
‘(10B) Where a determination has become final and binding in accordance with this section, the respondent may appeal to the High Court against the determination or any direction made under section 137(2).’.
No. 74, page 73, line 44, after ‘proceedings’, insert
‘(except an appeal under subsection (10A) or (10B))’.
Government amendment No. 97, in clause 143, page 75, line 21, at end insert—
‘(2A) The ombudsman must give the complainant a notice stating that a report under subsection (2) has been given to the relevant authorising body.’.
Amendment (a) thereto, in line 3, at end add—
‘(2B) The relevant authorising body must report to the complainant the action which has been or is to be taken by it in response to the report and the reasons for that action being taken.’.
No. 155, in schedule 15, page 224, line 22, at end insert—
‘(3) The persons with whom the OLC may make arrangements under subparagraph (1) above include approved regulators and external regulators.
(4) The arrangements that the OLC may make include arrangements for assistance to be provided to an ombudsman in relation to the investigation and consideration of a complaint.’.
Mr. Bellingham: Amendment No. 153 is the lead amendment in a key group that relates to complaints—in particular, who pays, especially when a complaint fails. Amendment No. 153 would remove the word “may” and insert the word “must”. Amendment No. 154 would provide the opportunity to delegate complaints to a body other than the ombudsman. Amendment No. 56 would enable the ombudsman to award costs against the respondent when the complaint is upheld. Amendment No. 59 is consequential.
Amendment No. 58 is the key amendment on the “polluter pays” principle, and I shall return to that in a moment. Incidentally, it is very similar to Government amendment No. 93, which is subject to amendments (a) and (b), tabled by the Liberal Democrats. Amendments Nos. 72, 73 and 74 are about the complainant and the respondent’s ability to appeal to the High Court. Amendment No. 94 is consequential. Amendment No. 155 relates to the delegation of complaints handling, with special relevance to the Bar Standards Board.
8.45 pm
Quite a few of the amendments are pretty technical, so in the short time left I shall concentrate on the two key amendments in the group. One deals with the situation in which someone complains about the conduct of a law firm, a barrister, a trademark attorney or legal executive. When that individual or firm is exonerated—totally vindicated—it is unfair if they have to pay significant costs.
There is an important principle at stake. We have heard today how the legal profession is under pressure as a result of the Carter reforms and their impact on legal aid and on single petitioner companies. We have heard how many market towns throughout the country will see a lot of consolidation and a lot of firms closing. It would be wrong to ignore David Clementi, who made it clear that those who are exonerated and held to be blameless should not have to pay costs.
Let me quote from the Second Reading debate in the other place. Lord Neill of Bladen said:
“It cannot stand up to any outside scrutiny that a man who has a false charge made against him has to pay the costs of the proceedings.”—[ Official Report, House of Lords, 6 December 2006; Vol. 687, c. 1185.]
In Committee, I made the point that many younger barristers specialise in the types of law, such as criminal law and family law, where unjustified complaints are likely to be the most prevalent. We do not want young barristers to be put off specialising in those areas of law. I shall not repeat the examples I quoted of an applicant or appellant who loses his case after a long- drawn-out set of proceedings, feels that he has nothing
to left to lose, and therefore takes action by way of making a complaint against the firm of solicitors and perhaps the barrister involved in his case. That happens all the time. In Committee in the other place, Baroness Butler-Sloss said:
“Family cases are highly emotional and very unhappy for those who engage in them. It is almost impossible to be objective about your own family problem. Whether in public law or in private law, the distress caused to litigants is enormous. Almost all litigants go away dissatisfied, most of them with the judge, which is fair enough, and many of them with the lawyer—the solicitor as well as the barrister”.—[ Official Report, House of Lords, 21 February 2007; Vol. 689, c. 1115.]
We felt strongly that where the “polluter pays” principle was concerned, it was essential that the Government take the time to listen to what we had to say and to react. I am pleased that the Government have tabled an amendment that is very similar to ours—it is a classic example of co-operation and good will on all sides resulting in a favourable decision. Of course we would like to go further—ideally, we would not include the word “reduced”—but we are to some extent happy with the substantial progress that has been made. I would therefore like to say a big thank you to the Minister for what has so far been achieved.
Previously, I have spoken about complaints handling. In another place and in Committee, there was a spirited debate on the delegation of complaints handling. We had a lengthy discussion about the role of the Bar Standards Board and the extent to which it has put in place a lay chair and built up credibility not only within the profession, but across the legal services field and in the outside world, with consumer groups. Understandably, the board was concerned that all its hard work would be emasculated and marginalised. That is why we tabled amendments in Committee and why we are now proposing amendment No. 155. I shall not go into detail, save to say that it has now been overtaken to some extent by Government amendment No. 109.
Let me quote what the consumer group Which? has said. The group made it clear that it was dead against our amendments in Committee, but it now says:
“Over the summer, discussions have continued between the Bar Council and Which?.”
Obviously, it is good news that those discussions took place. It continues:
“We agree that the amendment now tabled by the Government to Schedule 15 meets the concern of the Bar Council but without undermining the OLC.”
In a recent letter to heads of chambers and circuit leaders, the Bar Council said:
“on complaints handling, a compromise satisfactory to us, the BSB and consumer bodies has now been tabled by Ministers...This will mean that the expertise of specialist barristers will not be lost to the complaints process, and we believe that it is a great improvement to the Bill for the benefit of consumers and barristers alike.”
Without going into detail on the technical points of our amendments, I repeat that we had a lengthy debate on the point in Committee. Indeed, there was a certain amount of disappointment among Conservative Members that the Minister was not prepared to go along with what we were asking for, but that was before the summer. I hope that she managed to have some holiday, but I doubt it because she worked very hard on the Bill. I am grateful to her for that hard work; it has delivered a pragmatic, sensible set of Government
amendments. I pay tribute to the outside organisations that worked hard on the matter. They never went over the top, but lobbied constructively, enthusiastically and with great effect. The result is that the Government have gone a long away towards where we wanted them to go, and I thank the Minister for that.
Mr. Kidney: I thank the Minister for Government amendments Nos. 93 and 97, but in each case I ask whether she has gone far enough. Amendment No. 93 is about charges that the ombudsman may ask practitioners to pay as a result of a decision on a complaint. I have always argued that the ombudsman ought to be able to match the charge to the degree of culpability. If someone is completely innocent, they should not pay anything; if they are completely guilty, they should pay the lot. But if they fall somewhere in between, because something that they did brought about the complaint, they should pay a share of the charge. I took it that Government amendment No. 93 said just that, but I spoke to the hon. Member for Somerton and Frome (Mr. Heath) and he did not think that it allowed that. If he is right, then perhaps the word “all” should not be included in proposed subsection (1A)(b) of the amendment, which says:
“the ombudsman is satisfied that the respondent took all reasonable steps”.
In amendment No. 97, the Government have tabled half of what I proposed in Committee. If a complainant complains to the ombudsman about bad service, the ombudsman may come to a decision on the matter and decide whether compensation is payable or a refund is due. However, the ombudsman may decide that there is a need for disciplinary investigation and action by the appropriate regulatory body, and they may refer the complaint to that body. As things stood in Committee, the consumer would not necessarily know that action had been taken by the ombudsman, so I am grateful to the Minister for saying that the complainant will receive a notice saying that their complaint has been referred to the appropriate regulator for consideration of disciplinary action. I argue that, at the end of the process, the regulator ought to tell the consumer whether disciplinary action has been taken, and so close the loop. That is the point of my amendment (a) to Government amendment No. 97, and I would be grateful to hear the Minister’s view on it.
Mr. Heath: I have three amendments in the group before us. I am persuaded that one of them, amendment No. 145, is entirely otiose, and I wish I had not tabled it; I can tell the Minister that I do not intend to press it to a Division. The other two are amendments to Government amendment No. 93. I thank the Minister for tabling Government amendment No. 93; it is a good response to the concerns expressed by all parties, both in Committee and before that. I pay tribute to all those who have argued the case that where there is no blame, there should be no penalty; that is the crux of the issue.
Bridget Prentice: It may help the hon. Gentleman to know that I am pleased to accept his amendments to Government amendment No. 93.
Mr. Heath: It is a joy to hear that from a Minister. We are always pleased when Ministers accept our amendments, and I need say nothing further. I am grateful to the hon. Lady for her assistance.
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