Previous Section Back to Table of Contents Lords Hansard Home Page



After Clause 38, insert the following new clause--


(". Schedule (Powers of Law Society) which extends the powers of the Law Society in relation to the conduct of solicitors and their employees and consultants) has effect.")

Lord Falconer of Thoroton: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 82. With the leave of the House, I shall also speak to Amendments Nos. 180, 215, 216 and 217.

These amendments represent a package of changes which the Law Society sought from the Government and which the Government were happy to promote. Their aim is to strengthen the Law Society's powers to investigate and deal with misconduct and to deal with solicitors who consistently give poor service.

Amendment No. 82 and Amendment No. 180 insert a new Schedule 7 extending the powers of the Law Society in relation to the practice, conduct and discipline of solicitors and their employees. Paragraph 1 of the schedule will give the society the power to monitor compliance by solicitors with the rules made under Section 31 of the Solicitors Act, whether or not there has been a complaint about a particular case. Paragraph 3 inserts a new Section 33A into the Solicitors Act which will allow the Law Society to make rules, with the concurrence of the Master of the Rolls, requiring solicitors to provide details of bank accounts operated in connection with their practice or any trust of which they are or were a trustee.

Paragraph 6 will allow the Law Society to close down a solicitors' firm that has been the subject of frequent and serious complaints about inadequate professional service. Paragraph 7 concerns non-qualified employees of solicitors firms found guilty of dishonesty. It will allow the Law Society and the Solicitors Disciplinary Tribunal to order that such a person may not be employed by any solicitors' firm. At present, the society can only require access to a solicitor's papers where a complaint about a particular case has been received.

14 Jul 1999 : Column 464

Paragraph 11 will allow the society to require solicitors to produce documents and files when there are reasonable grounds to suspect that there has been professional misconduct by a solicitor or a breach of the society's rules, or the professional services provided by a solicitor are not of an adequate quality.

Paragraph 13 gives the Law Society a new power to direct solicitors to pay any costs incurred during the course of an investigation of professional misconduct or failure to comply with the rules. The other provisions of the new schedule make equivalent amendments to the Administration of Justice Act 1985 (which deals with incorporated solicitors' practices), and other minor, technical amendments to the 1974 and 1985 Acts. Amendments Nos. 215-217 make consequential repeals. These powers will remove a number of unnecessary restrictions on disciplinary activity by the Law Society. I commend them to the House.

Moved, That the House do agree with the Commons in their Amendment No. 82.--(Lord Falconer of Thoroton.)

Lord Phillips of Sudbury: I support the Government in the series of amendments, which will prove extremely helpful in the better regulation of the profession.

On Question, Motion agreed to.



After Clause 38, insert the following new clause--


(".--(1) Section 23 of the Courts and Legal Services Act 1990 (recommendations of the Legal Services Ombudsman) is amended as follows.
(2) In subsection (1)(c) (written report of investigation to be sent to person with respect to whom recommendation is made), after "subsection (2)" insert "or an order under subsection (2A)".
(3) In paragraph (e) of subsection (2) (recommendation that costs be paid by person or body to which recommendation under paragraph (c) or (d) applies), for "which a recommendation under paragraph (c) or (d) applies" substitute "pay compensation under paragraph (c) or (d)".
(4) After that subsection insert--
"(2A) If after completing any investigation under this Act the Ombudsman considers that, rather than recommending the taking of any action by any person or professional body under paragraph (c), (d) or (e) of subsection (2), he should make an order requiring the taking of that action by the person or body--
(a) he shall afford the person or body, and the person who made the allegation, a reasonable opportunity of appearing before him to make representations; and
(b) having considered any representations from them, he may, in reporting his conclusions, make the order."
(5) In subsections (3) and (4) (reports), after "recommendation" (in each place) insert "or order".
(6) In subsection (6) (duty to have regard to Ombudsman's report), for "subsection (1)(b) or (c)" substitute "subsection (1)(b), (c) or (d)".
(7) For the sidenote substitute "Recommendations and orders."")

The Lord Chancellor: I beg to move that the House do agree with the Commons in Amendment No. 83. With your Lordships' leave I shall speak also to amendments Nos. 84, 85, 86, 181 and 218.

14 Jul 1999 : Column 465

The amendments amend the powers of the legal services ombudsman and cater for the establishment of a new post of legal services complaints commissioner. The new clause added by Amendment No. 83 will allow the ombudsman to make a binding order rather than a recommendation in respect of a complaint if he thinks that it is more appropriate. Before making a binding determination, the person or professional body concerned would be entitled to appear before the ombudsman to make representations about the order proposed.

That extension of powers will be a welcome addition to the ombudsman's armoury for dealing with those who are not providing an adequate service to their clients. It should assist clients to recover compensation that they would not otherwise receive. The ombudsman will not be obliged to use that power, but it will be available and will be of value in some cases.

Amendment No. 85 inserts a new clause giving the Lord Chancellor the power to appoint a legal services complaints commissioner if that proves to be necessary. The commissioner will have powers to intervene to improve the standard of complaints handling by the legal professional bodies where it proves inadequate.

The new clause inserted by Amendment No. 86 and the schedule inserted by Amendment No. 181 set out in detail the functions and powers of the commissioner, who will have the power to set targets and require a professional body to produce a plan setting out how it intends to improve its complaints handling performance to meet the targets. If a professional body fails to submit an adequate plan or to follow its plan, the commissioner will have power to fine it. The new post will be financed by a levy on those authorised bodies that it is appointed to oversee. It is only right that if the commissioner is appointed, the professional body that is failing should be required to cover the costs of the commissioner overseeing its complaints handling, not least because his appointment will have arisen out of the inadequacies of the profession's self-regulation.

The principal reason for the provisions is the poor and deteriorating performance on complaints against solicitors at the Office for the Supervision of Solicitors. The backlog of cases at the OSS is large and growing. The time taken to deal with complaints is unacceptable. The confidence of the public in our legal system depends in part on there being effective redress. The Government could not have stood idly by watching matters deteriorating when we had a legislative opportunity in the Bill to address the issue.

The provisions on the legal services complaints commissioner will be brought into force only if it appears that complaints about members of any professional body are not being handled effectively and efficiently. I would use the powers only after much thought and with a great deal of reluctance. In any event, I shall not use them within 18 months of Royal Assent. They are reserve powers and we wish to give the OSS in particular the opportunity to put its house in order.

14 Jul 1999 : Column 466

The Law Society recently published and adopted a report by Ernst and Young that set out a blueprint for a more efficient system for dealing with complaints against solicitors. I acknowledge that more resources have been allocated to complaints handling. Those are steps in the right direction. But much remains to be done. We shall watch developments carefully and indicate to the Law Society in particular what performance is necessary to be achieved if the commissioner is not to be introduced.

Amendment No. 84 gives me power to require any professional body to make payments to the legal services ombudsman in respect of some or all of the expenses of the ombudsman. I do not intend to use that power unless I appoint the legal services complaints commissioner, who will be financed by the failing professional bodies he is appointed to oversee.

The practice elsewhere is for ombudsman schemes to be financed directly by the professions concerned. Any payments required from a professional body will be proportionate to the size of the body and the number and nature of complaints generated. Those new powers will help to achieve better performance in the handling of complaints which I know is the aim of the Law Society and the other professional bodies. I believe that they are proportionate; they are certainly timely; and I have no doubt that they will be welcome to the public.

Moved, That the House do agree with the Commons in their Amendment No. 83.--(The Lord Chancellor.)

On Question, Motion agreed to.

Next Section Back to Table of Contents Lords Hansard Home Page