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1
Q

What/who is FCA responsible for regulating?

A

Regulate conduct of all firms, inc dual-regulated firms and the prudent regulation of those not regulated by Prudent Regulation Authority (i.e. FCA-authorised or FCA-only firms)

And for consumer credit / second charge mortgages

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2
Q

3 objectives of FCA

A
  1. Protect consumers
  2. Enhance integrity UK financial system
  3. Promote effective market competition in interests of consumers
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3
Q

What and who is PRA responsible for?

A

Authorising, prudent regulation and general supervision of firms which manage significant financial risks

inc. banks, building societies, insurers, credit unions, certain investment firms

aka PRA-authorised or dual-regulated firms

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4
Q

What activities are included under PRA-regulated activities and effect?

A

Accepting deposits, insurers and investments as principal (using own assets to buy)

Any company carrying out becomes PRA-authorised

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5
Q

Do firms need to obtain authority for authority from FCA for engaging in regulated financial activity (e.g. corporate)?

A

Not if supervised by a DPB

SRA is a DPB

And can meet certain conditions

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6
Q

Two main restrictions under FSMA 2000 on solicitors carrying out financial services?

A
  1. Can’t carry out regulated activity unless authorised or exempt (General prohibition)
  2. Making a financial promotion
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7
Q

Implications of breaching FSMA restrictions (solicitors)

A
  1. criminal offence up to 2 years imprisonment
  2. unlimited fine
  3. relevant agreement unenforceable
  4. breach contract (the contract between sol and client)
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8
Q

Test to determine a regulated activity? (i.e. by FCA)

A
  1. Are you in business?
  2. Specified investment?
    (or does the specified activity relate to info about a persons financial standing or administering a benchmark?)
  3. Is there a specified activity?
  4. Is there an exclusion?

(active re-call to expand and see OneNote )

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9
Q

What constitutes ‘information about a person’s financial standing or administering a benchmark’ for purpose of regulated activity?

A

Financial standing:
Providing or advising on credit reference and credit information services

Benchmark:
Used in markets to set prices/measure performance/value amount payable under contracts

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10
Q

What counts as specified investment activity??

A

Dealing as agent
○ (buying/selling/subscribing/underwriting clients investments for client and commits them to it)
○ Eg selling shares on divorce order
- Arranging
○ Involved in contract between client and investment company - re investments
○ Eg contract between client and life company or client and stockbroker
- Managing
○ About exercising discretion
○ Mainly if trustee or PR
** - Safeguarding**
○ Safeguarding/administering investments
○ Mainly trustee PR
** - Advising**
○ Specific advice
○ Eg in buying in tesco
But not regulated if give generic advice (eg respective merits of diff types of mortgage)

AAMSA
Ah Alice May Soon Appear

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11
Q

What exclusions may apply to authorise solicitor in a transaction for an otherwise specified regulated activity?

A
  • Introducing
  • Using an authorised ATP
  • Acting for an execution-only client
  • Acting as a trustee or PR
  • Professional/necessary
  • Body corporate takeover

(see OneNote)

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12
Q

What exclusions apply to allow solicitor to deal as agent?

A
  • ATP (authorised TP)
  • Execution-only
  • Professional/necessary
  • Corporate body takeover
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13
Q

What exclusions allow solicitors to arrange?

(i.e. involved in contract between client and the other person in an investment)

A
  • Introducing
  • ATP
  • Execution-only
  • Professional/necessary
  • Acting as trustee/PR
  • Takeover
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14
Q

What exclusions allow solicitors to advise?

(on merits of specific thing)

A
  • Professional/necessary
  • Acting as trustee/PR
  • Takeover
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15
Q

What exemption(s) apply re managing as a specified activity?

(discretionary active participation)

A

Acting as trustee/PR

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16
Q

What exemptions apply re safeguarding as specified activity?

A

Prof/necessary
Acting trustee/PR

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17
Q

What are the requirements for body corporate exclusion?

A

Acquiring/disposing shares in company and:

  • Shares 50% or more of the voting shares; AND
  • between parties each of whom a body corp, partnership, single individual or group of connected individuals

(if haven’t reached 50%, can add together those acquiring to those already owned by group of connected individuals - directors/managers and their families)

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18
Q

When will professional/necessary exclusion apply? Examples.

A

Can’t provide other services properly unless perform that regulated activity

e.g. IHT / acquisition of company

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19
Q

when can rely on s 327 exclusion?

A

All below:

  1. No pecuniary / other other than from client unless give to client
    (same as code of conduct)
  2. Incidental to services
    - specific to that client; and
    (complementary professional service - incidental or subordinate - would have to be the client, not say a beneficiary)
    - general
    i.e. not signif part of firm’s services / advertised specially / 50% or more of income
  3. comply SRA COB/Scope rules
    - not prohibited by FSMA - eg disposing of rights under pension scheme / creating or underwriting insurance
    - notify if intend undertake insurance distribution activities
  4. not prohibited by Treasury order or FCA direction
  5. not already FCA regulated

(see OneNote)

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20
Q

What are the two tests for whether a financial regulated service is incidental to its SRA-regulated services?

A
  1. Specific
    - Arise out of or be complementary to other professional service to same person
  2. General
    - can’t be major part of activities, consider if:
    half income
    high percentage of offered activities
    held out as separate activities
    impression firm gives of how those activities provided
    (e.g. if advertised as incidental or not)
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21
Q

Under SRA Scope Rules, examples of what activities are permitted by SRA?

(part of s327 exemption)

A
  • Can’t carry out activity specified in** Treasury order**
    e.g. recommended to dispose of rights under pension scheme or creating insurance contract
  • If wish undertake insurance distribution, notify SRA, register with Financial Services Register and appoint insurance distribution officer
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22
Q

What is the purpose of COB rules?

i.e. SRA Financial Services (Conduct of Business) Rules

A

Regulate way firm undertakes financial services under professional exemption

(i.e. where regulated by SRA instead of FCA and carrying out exempt regulated activity)

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23
Q

What are the main COB rules?

A

way can carry out under s 327 exemption

	○ Status disclosure (ie that not authorised by SRA)
	○ Best execution (ie interests) - don’t carry out if not in best interests
	○ Transactions (keep records)
	○ Commissions (keep records)
	○ Execution-only and investment is a retail investment product, letter confirming client not relying
	○ Insurance distribution activitires
		§ Clear, fair, not misleading Nature renumeration re contract provided before conclusion
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24
Q

Under COB rules, what must firm do if acting for execution-only client?

A

Execution-only client and investment is a retail investment product
(e.g. life policies/stakeholders/pension schemes/unit trusts)

Letter to client confirming not relying on solicitor’s advice

(eg retail investment product is insurance contract - execution only would not apply so would have to rely on exemption - and therefore comply COB rules)

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25
Q

When do COB rules apply?

A

Carrying out an exempt regulated activity

(i.e. s 327 exemption)

(not where they are EXCLUDED - e.g. bod corporate)

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26
Q

What section exempts professional firms from general prohibition?

A

s327

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27
Q

Under COB rules, what info must be provided re insurance distribution activities?

A

Clear, not misleading, fair way

Info re nature of remuneration received re the contract of insurance

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28
Q

What are insurance distribution activities?

A

**preparing or administering insurance contracts **

Activities of advising on, proposing or carrying out other work preparatory to the conclusion of contracts of insurance, or of concluding such contracts, or assisting in administering and performance of such contracts

(btw insurance contract is like between me and travel insurers about where said stuff like can’t claim not public healthcare)

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29
Q

What’s a body corporate?

A

another name for a company

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30
Q

What is considered ‘insurance distribution’ for purposes of regulated activity?

A

Advising on, proposing or carrying out work

relating to preparing, concluding or assisting in

administering or performing contracts of insurance

(baso just working on insurance contracts - and insurance contracts are anything involving insurance)

the exclusions dont apply, so have to rely on s 327 or seek fca authorisation

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31
Q

Do EXCLUSIONS apply to insurance work?

A

No, even if just introduce to insurer or insurance claim against insurers

So need to rely on s327 exemption (or seek FCA authorisation)

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32
Q

What is the execution-only exclusion?

A

Can act as agent (on behalf) or arrange (middle man) as long as not asked to or decline to advise on merits of entering transaction

But not apply for insurance or if get commission from a TP which don’t give to client

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33
Q

What’s a financial promotion?

A

Invite or induce to engage in INVESTMENT ACTIVITY

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34
Q

When can a solicitor offer financial promotion?

A

Contents approved by authorised person

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35
Q

What is the test for if something is a financial promotion?

(and therefore not FCA authorised)

A
  1. Made in business
  2. Making invite or inducement
  3. Is there a specified investment?
  4. Is there a specified investment activity?

NB no exclusion test applies

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36
Q

What are 2 types of financial promotions for SRA firms?

A
  1. Real-time promotions
    - in course of personal visit, phone call etc
  2. Non real-time promotions
    - letters, emails etc
    - includes comms with other side
    (so they could also be construed as financial promotion)
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37
Q

What main exemptions apply re financial promotions?

A

one-off promotions

introducer

trustees, PRs

body corporate takeover

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38
Q

When can a solicitor rely on real-time promotions exemption to make a financial promotion?

A
  1. Before the communication, client instructed solicitor to act for them;
  2. Carrying out exempt activity (s 327) OR necessary exclusion applies; AND
  3. For purpose of or incidental to the services supplying to client

(so if excluded other than cos necessary, can’t financially promote)

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39
Q

When can financial promotion be made non-real time?

A

(letters etc)

ONLY if carries out exempt regulated activities and promotion contains certain statements

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40
Q

When can a one-off promotion be made?

(exclusion which allows financial promotions to be made)

A

one-off non-real-time or REAL-TIME SOLICITED if PERSONAL to client
(think real-estate solicitor)
- remember for non-real time: certain statement
- real-time: must be necessary and incidental

OR

One-off unsolicited real-time - believe on reas grounds:
a) client understands risks; and
b) would expect solicitor to be contacting at that time about that activity

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41
Q

Can you introduce a client to an ATP for specified investment activities?

A

No - can do so if

  1. Real-time communication:
  2. Not connected (e.g. close relative);
  3. Not receive from anyone other than client for it; and
  4. Client not requested (or declined to give) advice on merits of investment
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42
Q

What is not a specified investment? Impact of this if give advice on?

A

Interest in land
(e.g. residential property)
Most National Savings products
(inc all National Savings Certificates)

Disciplinary proceedings as breach SRA C of C (but not criminal offence etc)

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43
Q

What counts as specified investment?

A
  • shares
    (unless in the share capital of an open-ended investment company or building society incorporated in the UK);
  • debentures, loan stock and bonds;
  • gilts
  • unit trusts and OEICs;
  • contract of insurance;
  • regulated mortgages (most resi);
  • home reversion/home purchase plans (where can sell part/whole home to raise money then become tenant);
  • deposits.
  • credit arrangements
    (except some between solicitor and client)
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44
Q

What is a unit trust?

A

pools investors’ money into a single fund, which is managed by a fund manager

(nb OEICs are v similar)

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45
Q

What is an exempt agreement between solicitor and client under FSMA 2000 in terms of solicitor/client fee arrangement?

What type of regulated activity is it?

A

Where solicitor allows client to pay their fees in instalments if

  1. Max 12 repayments;
  2. Over max 12 months; and
  3. No interest or other charges

Consumer credit activity.

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46
Q

What are the six types of reserved legal services?

A

(those seen as riskiest)

  1. Exercise of right to audience
  2. Conduct of litigation
  3. Reserved instrument activities
  4. Preparing probate papers
    (ie docs needed to obtain or oppose grant)
  5. Notarial activities
    (certify docs)
  6. Admin of oaths
    (eg affidavit)
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47
Q

What is dealing as agent exclusion and when does it apply?

A

Buying, selling, subscribing for or underwriting investments on behalf of client

e.g. selling client’s shares after divorce

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48
Q

Body corporate takeover - which specified activities does it apply to?

A

3 As

Arranging, advising, agent

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49
Q

What are national savings certificates and are they specified form investment?

A

Government issues

Safe form investment

Not a specified investment bcos not risky

So CAN advise on

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50
Q

What is consumer credit activity and when can you act for client in related matters?

A

e.g. debt management/debt collection under consumer credit agreement or hire agreement/debt advice/debt administration

Litigation proceedings arising out of consumer credit / hire agreement not count so can do that

otherwise only if authorised by FCA or s 327

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51
Q

All exclusions to allow solicitors to make financial promotions?

A

None !

But can use exemptions:
- Trustees and PRs
- Body corporate
- One-off promotions
(unsolicited NRT/solicited RT - personal, and unsolicited RT in certain situs)
- Introducers

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52
Q

Explain when trustee/PR exemption applies

A

Only if acting AS trustee or PR not FOR
- or if one solicitor in firm acting as, and activity by another

Applies to arranging, managing, safeguarding and advising fellow trustees/beneficiaries; AND

Lending money on or administering regulated mortgage contract

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53
Q

Limitations to relying on trustee/PR exclusion

A

Being remunerated extra

Only available for managing and safeguarding if not hold selves out as providing service which comprises of that

And doesn’t apply for insurance obvs

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54
Q

What is money laundering?

A

Process whereby proceeds of crime are changed so that they appear to come from a legitimate source.

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55
Q

What three distinct stages are there in money laundering?

A
  1. Placement (proceeds of criminal activity introduced into financial system)
  2. Layering (proceeds distances from the criminal activity by passing through other parties or transactions)
  3. Integration (integrated back into the financial system and return to criminal’s possession)
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56
Q

Key risk areas for money laundering for solicitors

A
  1. Company work and trust work
    - money can be hidden within their structures / layers of ownership
    - want solicitors involved in management so looks respectable
  2. Use of client account
    - swap illicit money for clean
    e.g. says going away and transfers just in case it completes, later changes mind so not proceed purchase, says transfer to a diff account
  3. Real estate
    - money has to pass through client account to proceed
    - criminal can then sell asset to produce legitimate proceeds
    - seller sometimes complicit
    (e.g. no mortgage, transfers 500k, seller randomly reduces to 400k, instructs surplus paid to someone else)
  4. Sham litigation
    (e.g. judgment in default against overseas company, overseas company pays firm, who pays client)
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57
Q

UK money laundering legislation also covers

A

terrorist financing

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58
Q

money laundering regulations apply to

A

all persons acting in course of business carried out in UK

includes independent legal professionals

  • obvs most solicitors firms but also trust or company service providers, tax advisers and insolvency practitioners
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59
Q

Effect of failure to comply money laundering regulations?

A

Criminal offence

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60
Q

Who supervises anti-money laundering regulations for solicitors?

(inc monitoring compliance / approval etc)

A

SRA

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61
Q

What must firms and sole practitioners do to be approved under money laundering regulations?

A

Beneficial owners, officers or managers of firm and sole practitioners

Must apply to SRA for approval under the Regulations

SRA must grant unless applicant convicted of a ‘relevant offence’ (e.g. under previous money laundering legislation, terrorism or any offence involving dishonesty/deception)

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62
Q

Effect for acting without approval under money laundering obligations?

A

Criminal offence which may result in imprisonment, fine or both

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63
Q

As per professional conduct requirements for law firms, what must ensure re money laundering?

(aside from SRA approval etc - just arising from code of conduct)

A

Need structures, arrangements etc to ensure compliance

Must identify, monitor and manage material risks

Take action to prevent money laundering

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64
Q

What should a firm’s risk assessment for money laundering entail?

Implications of it?

A

Firm-wide risk assessment

Considering services offered, how delivered, type of clients and industries

Must address risks with trusts and company, real estate and client account use

Take into account SRA’s risk assessment (broad / is for whole of profession)

SRA may ask to see the firm’s risk assessment and take action if inadequate

Must maintain record of steps taken as a result of risk assessment

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65
Q

What policies must firm establish and maintain re money laundering?

A

Establish and maintain written anti-money laundering policies, controls and procedures

Proportionate to size / nature of firm

Approved by senior management

Related to risks identified in risk assessment

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66
Q

Under money laundering obligations, what roles must firms appoint?

A
  1. money laundering compliance officer (MLCO)
    - only need if appropriate considering size/nature firm
    - SRA point of contact
  2. nominated officer (MLRO)
    - receive internal reports re suspected money laundering and consider whether to report to NCA

(can have same individual doing both)

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67
Q

Aside from appointing MLRO and MCLO, what internal controls must firms implement?

how many yrs able to answer to sra for?

A
  1. Screen employees whose work is relevant complying with Regulations or who help identify/prevent/detect money laundering prior to and during employment
  2. establish independent audit function to examine firm’s policies re regulations
  3. ensure able to respond to law enforcement enquiries re business relationships with any person over last 5 years
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68
Q

wbhen must do customer due diligence requirements under money laundering regs?

A

verify client’s ID if:

  • agree to form business relationship
  • transferring over 1k euros not as part of business relationship
  • carrying out occasional transaction over 14k euros
  • suspects money laundering / terrorist financing
  • doubts docs supplied re their identity
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69
Q

When must ID verification take place if required under money laundering regs?

A

General rule = first contact
So before business reli established or carrying out transaction.

However can do DURING business reli if:

  • little risk of money laundering;
  • not necessary interrupt normal course business; and
  • verified as soon as practicable
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70
Q

If solicitor cannot complete client due diligence on time, they must:

A

MUST NOT:

  • carry out transaction with or for client through a bank account
    (eg buying house)
  • establish a business relationship or carry out transaction other than via a bank account

MUST:

  • consider NCA disclosure
  • terminate any existing business relationship
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71
Q

What are the diff types of client due diligence?

A
  1. Standard DD
  2. Simplified DD
  3. Enhanced DD
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72
Q

How to verify ID under standard DD?

(i.e. for most clients)

A

Documents or info obtained from a reliable source, independent of person being verified
(e.g. driving licence - even if copy provided by individual it is issued by DVLA)
(not letter from a friend)

Take reasonable measures to understand ownership / structure of companies and trusts

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73
Q

Good practice on proving identity?

A

A) gov’t doc which verifies name and address or DoB; or

B) gov’t doc which verifies name and a separate doc verifying name and address or DoB

Ideally sight of originals. Copies if justifiable on risks.

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74
Q

Non-limited liability partnerships (inc general partnerships) - standard DD - what is required?

A

Info on the individuals

If well-established/reputable - enough just to get name, registered or trading address and nature of business

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75
Q

Companies - standard DD ID requirements?

A

Standard DD:
- name
- company number or other registration
- registered address and principal place of business (if diff)

unless public - reas measures to check which law subject to/incorp docs/names of directors etc

  • proof of registration
    (companies required to provide if requested)

good practice = if person instructed is authorised to

Unless simplified DD applies:
- consider identify beneficial owners

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76
Q

When must solicitor consider beneficial owners under client DD?

A

Beneficial owner is not the client

Simplified DD not apply

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77
Q

Who will be a beneficial owner in LLP or private company for purposes money laundering regs?

A

private companies and LLPs:
- individual exercises ultimate control over management of company;
- owns or controls over 25% shares or voting rights
(via shares or other means)
- controls body corporate

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78
Q

Do you need to do further client DD if the beneficial owner is a parent company?

A

Not compulsory - risk-based decision

Often seek identity of beneficial owners of parent company

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79
Q

Beneficial ownership in general partnership

A
  • entitled to or controls over 25% share in capital or profits or voting rights
  • otherwise control over management (eg authority to use funds outside of normal management)
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80
Q

Who is beneficial owner of trust for money launder regulations?

A

EACH of the following
- settlor
- trustees
- beneficiaries
- if beneficiaries not determined, class of persons who have main interest
- anyone with power over trust

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81
Q

Whose ID do you get for a trust client DD?

A

Identify beneficiual owner if beneficial owner is not the client

This means settlor, trustees, beneficiaries, potential beneficiaries and anyone with control over the trust (eg to add/remove beneficiaries)

  • if company, do usual company diligence (ie name/address/registered office - unless regulated market, constitution/governing docs/names board directors) and proof of registration

NB: if simplified DD, no need consider beneficial owners

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82
Q

When is simplified DD permitted?

A

Firm determined through individual risk assessment that business reli or transaction low risk

Considering facts, inc:
- if listed on a regulated market
- where it is listed
- where client does business
(e.g. if UK stock exchange low risk)

NOT about type of work involved

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83
Q

What must solicitor do if considers simplified DD applies and what does simplified DD entail?

A

Must - obtain evidence that client/transaction eligible for simplified DD

Doesn’t necessarily need to obtain info on beneficial owners

Amount of info need depends on client

e.g. PLC - just obtain confirmation of company’s listing on stock exchange

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84
Q

When is enhanced due diligence required?

A

Something about arrangement gives high risk of money laundering

Circumstances include:
- situ identified in firm or SRA/Law Soc risk assessment
- high-risk third country
- false or stolen ID
- complex or unusually large
- unusual pattern/purpose
- PEP or known associate
- other (e.g. not met face to face or payments from unknown TPs)
**

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85
Q

What must you do if enhanced client DD applies?

A

Take reasonable measures to consider
- background and purpose transaction
- whether more ID or info on ownership required

Monitor throughout retainer

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86
Q

What is a PEP and related people?

A
  • head of state/ministers
  • MPs
  • Judges of higher courts
  • boards of banks / members court of auditors
  • ambassadors/high ranking army officers
  • members of admin/management/supervisory bodies of State-owned enterprises

And spouse, children, parents and children’s spouses

And their close business relationships

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87
Q

Obligations if dealing with PEPs or their associates?

A

Approval of senior management to act

Taking adequate measures to establish source of wealth and funds used

Conduct ongoing enhanced monitoring

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88
Q

Are solicitors obliged to undertake ongoing monitoring of clients?

A

Yes - must ensure transactions consistent with knowledge of client

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89
Q

Training requirements under money laundering obligations?

A

Provide and maintain record of training to employees

Should be made aware of law and related data protection requirements

Should be trained on how to identify potential ML

Doesn’t specify how training take place

Suggest staff manual

No training may give defence to employee

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90
Q

Firm’s record keeping obligations under money laundering regs?

A

Copy of docs and info obtained to satisfy DD and any relevant supporting records re transaction

Keep for at least 5 years after the relationship or occasional transaction ends

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91
Q

Applicable offence to law firms under Criminal Finances Act 2017 and when would apply?

A

Corporate offence of failure to prevent criminal facilitation of tax evasion
(e.g. fraudulent evasion VAT/income tax/cheating public revenue)

Liable for employees and other associated persons

Strict liability - no knowledge or intention of managers etc required

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92
Q

Defence available to firms’ liability under Criminal Finances Act 2017 (tax evasion)?

A

Had reasonable prevention procedures in place or was reasonable not to have them in place

Need firm-wide risk assessment, training, ongoing monitoring

Already have procedures in place for money laundering - make sure they also comply CFA 2017

e.g. due diligence policy considers risk tax evasion by firm’s own partners/employees/other associated persons e.g. barristers used

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93
Q

Impact is the UK financial sanctions regime on law firms?

A

Serious restrictions on dealing with ‘designated persons’ on the sanctions list (sanctioned by UK, EU or UN)

Applies to ALL law firms

Must inform Office of Financial Sanctions if reasonably suspect someone to be a designated person

If wish to act for them, must obtain licence for a fee

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94
Q

Does discussing someone’s sanctioned status amount to a tipping off offence?

A

No - it’s public info

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95
Q

Under economic crime act 2022, what penalties against law firms re UK financial sanctions regime?

A

EVEN IF no knowledge or reasonable cause to suspect transaction to which they are a party is in breach of sanctions regime

Can still be liable for fines

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96
Q

Do you need to conduct due diligence on client if you have personal knowledge of them?

A

Yes you do

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97
Q

What are the key offences under Proceeds of Crime Act 2002 applicable to solicitors?

star bcos imp

A
  • Entering or becoming concerned in an arrangement which know or suspect facilitates proceeds of crime
  • Acquiring, using or possessing proceeds of crime
  • Concealing, converting or transferring proceeds of crime
  • Removing crime proceeds from Eng and Wales
  • Failure to disclose money laundering info to authorities
  • Firm’s nominated officer failure to disclose money laundering info to authorities
  • **Tipping off **individual that investigation into money laundering underway
  • Prejudicing money laundering investigation
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98
Q

Most relevant offence under Proceeds of Crime Act 2002 for solicitors

A

Arranging

(ie entering or becoming concerned in arrangement which KNOW OR SUSPECT facilitates acquisition, retention, use or control of CRIMINAL PROPERTY)

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99
Q

Explain the breadth of the ‘arranging’ offence (under Proceeds Crime Act 2002) as applying to solicitors?

A

Wide - covers any act which assists another to launder money

Doesn’t matter if didn’t pass through solicitor’s hands

e.g. client is buying a company and discover lots of their contracts were obtained by paying bribes

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100
Q

What constitutes ‘know or suspect’ for purposes of proceeds of crime offences?

A

Threshold is “suspicion”

Subjective test - bar is low:

D must think there is a possibility which is MORE THAN FANCIFUL that relevant facts exist
(ie that there is potential money laundering)

(nb more than vague feeling of unease)

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101
Q

What is criminal property for purposes of Proceeds of Crime Act?

A

Person’s direct or indirect benefit from criminal conduct
e.g. profits from crime / stolen property

Must know or suspect property benefitted from criminal conduct

Must have been an initial criminal offence committed (in UK or abroad if it would have also been criminal in UK)

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102
Q

What is excluded from ‘arranging’ offence for solicitors under Proceeds of Crime Act?

A

Taking steps in litigation, provided not sham litigation

Dividing assets in accordance with court judgment (eg divorce)

But could not assist in reinvesting them

Consider whether client would be committing offence by receiving the property

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103
Q

Defences to s 328 (arranging) Proceeds of Crime Act?

A

Authorised disclosure

Reasonable excuse for not making authorised disclosure
- intended to
- rare - e.g. info already in domain
- must record reasons

Overseas defence
- knew or believed occurred abroad and lawful in that country
- S of S can override

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104
Q

When will authorised disclosure defence apply for individual solicitors?
(proceeds crime act/arranging)

Include diff stages of when AD made

A

Make authorised disclosure to constable, HMRC or firm’s nominated officer (MLRO)
(ideally to MLRO)

AND got consent of nominated officer or NCA

If proceed without consent, no defence

A) Soon as practical prior to transaction

B) If prohibited act is ongoing:
- made whilst ongoing
- when began to act, did not know or suspect
- soon as practicable after first suspect
- make on own initiative

C) AFTER profited act if:
- good reason
- soon as practicable
- own initiative

(nb just bcos consent to money laundering ops, prof conduct etc still relevant)

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105
Q

Responsibilities of nominated officer (MLRO) for defence to arranging to apply under Proceeds of Crime Act?

A
  • responsible reporting ML concerns to NCA
    AKA suspicious activity report (SAR)
  • online ideally or by post
  • not obliged raise SAR whenever internal concern raised - discretion
  • criminal offence if fail to report when reasonable grounds to suspect ML
  • must not give consent to solicitor who has raised AD and once MLRO made SAR until either:
    1. received NCA consent; or
    2. heard nothing for 7 working days after sending SAR; or
    3. refused by NCA
  • don’t consent unless granted within 31 days from refusal (can be extended in certian situations)
    (31 days starts day of approval)
106
Q

Penalties for arranging OR acquisition, use or possession under Proceeds Crime Act?

(ie involved arrangement know or suspect facilitates ML)

A

Max 14 years imprisonment

107
Q

Explain s 329 - acquisition, use or possession offence - under Proceeds Crime Act / how applies to solicitors?

A

Acquire, use or possess criminal property

Usually where no involvement in original crime but benefitted

e.g. paid extortionate legal fees and possibly criminal property

108
Q

Defences to s 329 acquisition, use or possession offence under Proceeds Crime Act?

A

Overseas defence

Authorised disclosure defence

Adequate consideration defence (main one)
- receive money for legal fees, inc disbursements
- as long as fees reasonable considering value of work
- and provided did suspect goods or services provided would help carry out illegal activity

109
Q

Explain concealing offence and defences under Proceeds of Crime Act?

A

Offence conceal, disguise, transfer or remove outside of UK (inc Scotland etc)

E.g. resi - converting proceeds into property
Transfer - from client account etc

Authorised disclosure and overseas defences

Main one for solicitors

110
Q

Explain the failure to disclose offence under Proceeds Crime Act?

A

Commit offence if:
- knew/suspected OR reas grounds to that ML
(reas = what should have known)
- receive in course of business/regulated sector
- info will or may assist identifying launderer/property
(considering if was reas to think may assist)
- does not make disclosure soon as practicable

Not necessary for ML to have even occurred

111
Q

When can you committed of offence under PCA even if did not KNOW or SUSPECT that ML?

A

Failure to disclose
(nominated officers or normal individuals)

Objective as well as subjective test

Reasonable grounds to know or suspect

NB training defence applies if there were reasonable grounds to suspect but had no proper training

112
Q

Defences to failure to disclose offence under Proceeds Crime Act?

A

Authorised disclosure / intended disclosure

Training defence
- if reasonable grounds to suspect but not received proper training

Legal professional privilege
- advice and litigation privilege applies
- EXCEPT cannot rely if purpose of advice is carrying out criminal offence

Overseas defence

113
Q

Penalties for failure to disclosure under Proceeds of Crime Act?

A

Max 5 years imprisonment

114
Q

How does failure to disclose offence apply differently to nominated officers?
(Proceeds of Crime Act)

A

If know/suspect or reas grounds to know or suspect money laundering DUE TO INTERNAL REPORTS

And fail to make disclosure to NCA as soon as practicable

Defence if reasonable excuse for not disclosing

115
Q

What is the tipping off offence? (Proceeds Crime Act)?

A

2 offences.

  1. Disclosing a disclosure
    - usually to NCA or MLRO
    - to anyone if likely prejudice
    (eg house delay because investigating)
  2. Disclosing an investigation
    - investigation carried out or contemplated
    - and that is likely prejudice

Irrelevant whether intended to alert ML or prejudice investigation

Both - must have received info course business regulated sector

116
Q

Defences to tipping off?

(Proceeds Crime Act)

A

Did not know or suspect disclosure would prejudice investigation
(eg maybe if informs client believing they will fully cooperate with authorities)

Or if purpose is to dissuade client from engaging in alleged money laundering - but treat with caution

117
Q

Penalties for tipping off

A

Unlimited fine and / or max 2 years prison sentence

118
Q

When will someone prejudice investigation (and commit offence under PCA)?

A

(baso same as tipping off but applies non-regulated)

Suspect ML investigation about to commence

And make material disclosure to another

Which is likely prejudice or interferes with relevant material

119
Q

Will communicating confidential information about clients under Proceeds Crime Act conflict with Code of Conduct SRA?

A

No

Client confidentiality is unless required or permitted by law

Legislation expressly states disclosure won’t breach this

Still seek advice if unsure

120
Q

Role of SRA under Proceeds Crime Act?

A

If direct involvement in money laundering, breach:
- Principle 4 act with honesty and
- Principle 1 duty uphold RoL/admin justice

So likely disciplinary proceedings and significant sanctions

121
Q

Warning signs of money laundering?

A
  1. The client
    (e.g. secretive, evasive, avoids personal contact, refuses provide docs, criminal associations)
  2. Funding
    (large cash payments, unexplained from TPs, foreign accounts etc)
  3. Transaction
    (unusual features eg loss making, unexplained urgency, litigation settled too easily)
  4. Geographical concerns
    (eg from far away, unexpected movement between jursdictions, connected with suspect jurisdictions)
122
Q

What is authorised disclosure a defence to?

A

328, 329 and 327

i.e.
Arranging
Acquisition, use or possession
Concealing etc

(so NOT to failure to disclose, tipping off or prejudicing an investigation)

123
Q

If you do not offer legal aid work but think client may be eligible, what must you do?

A

Advise client that may be eligible

If necessary, tell them to seek other advice

124
Q

SRA code of conduct requires solicitors to consider clients needs, ____ and ___

A

attributes and circumstances

nb relevant in considering appropriate funding option

125
Q

What are the main funding options for legal fees?

A
  1. Conditional fee arrangement -
    if win, enhanced fee.
    if lose, lower or no fee.
  2. private funding
    - client pays at hourly rate
  3. fixed fee
  4. damages-based agreement
    - if win damages, gets a proportion.
    - if don’t, get nothing.
  5. third-party funding
  6. before-the-event insurance
    existing insurance policy covers
  7. after-the-event insurance
    taken out to cover own dibs AND liability for o/s costs if lose
126
Q

explain private funding (of legal fees)?

A

standard

pay fees based on hourly rate / time spent

dibs and expenses charged seperately

told changeout rates at srart

ultimate cost open-ended as depends how long it takes

client personally responsible regardless outcome

127
Q

good funding option where client carrying out claim themselves but just need solicitors help on one thing eg attending hearing

A

fixed fee

128
Q

Can a fixed fee be changed at a later date?

A

Not unless client agrees

129
Q

Difference between contentious and non contentious businesss

A

Contentious:
- work done in relation to proceedings
- only starts once proceedings been issued

Non-contentious:
- anything not the above ^

130
Q

Difference between contentious and non-contentious business agreements?

A

Contentious business arrangement must state its a contentious business arrangement

If contentious business arrangement allows solicitor to be paid via hourly rate, can apply to court for assessment of costs

Contentious - limits to fees which can be charged in certain circumstances, does not apply non-contentious

Can’t receive contingency fee under contentious business arrangement
(nb wouldn’t be relevant anyway to non-contentious)

131
Q

Options for funding civil litigation?

A
  1. Hourly rate
  2. Variable fees
    i.e. solicitor’s fee varies upon outcome

A) Conditional fee arrangements

B) Damages based agreements

132
Q

Max success fee under a CFA?

(clue: percentage)

A

100% of solicitor’s usual hourly rate

Additional cap on PI cases - can’t recover more than 25% of damages received

133
Q

If entered CFA and client wins, can other side be ordered to pay the client’s success fee?

A

No, client must pay it.

134
Q

Can disbursements be included as part of a CVA?

Is this usual in practice?

A

Yes permitted to include

Firms usually exclude cos don’t want to be out of pocket
- so if don’t include dibs under CFA and client loses, probs won’t need to pay solicitor’s fees but will have to pay dibs

(eg counsel’s fees)

135
Q

Can a defendant enter a DBA?

A

Only if counter-claiming

136
Q

If client wins under DBA, costs payable to opponent will be paid from ___

A

The damages recovered

(so the damages will be used to cover any of opponent’s costs and their own legal fees)
(if there is a shortfall, personally liable to pay balance)

137
Q

May be good idea to combine CFA/DBA with …. ?

A

ATE

(after the event insurance)

(bcos if client loses, will not be responsible for own solicitor’s fees but may be liable for their dibs and usually to pay opponent’s costs)

138
Q

DBA formalities?
Impact if not followed?

A
  1. In writing
  2. State what proceedings relates to
  3. State circumstances in which fee payable
  4. State reason for fee being the figure it is

Agreement unenforceable and client not need to pay any fees.

139
Q

If a client terminates retainer early when there is a DBA, can firm still recover fees for work done until this point?

A

Yes
In textbook example, the DBA stated they would be paid if terminated before conclusion of case.

140
Q

Diffs and similarities between CFAs and DBAs?

A
  • CFA success fee limited to 100% usual hourly rate / DFA: 50% damages
  • both must be in writing
  • neither cover client’s own dibs or opponent’s costs
141
Q

Is client allowed to choose own solicitor if using before-the-event insurance proceedings?

A

from point of starting proceedings, client is entitled to instruct solicitor of their choosing

(but do prefer to use panel of solicitors)

142
Q

Is ATE insurance available for all types of civil litigation?

A

Not for family law

143
Q

What does after the event insurance usually cover liability for?

A

Dibs and opponent’s costs

Is possible to obtain for own legal fees (not as usual)

144
Q

Will ATE (after the event insurance) be recoverable from opponent if win?

A

No.

145
Q

Is third party funding available to defendants? Why/why not?

A

Not usually

Because get their fees from what is recoverable at end of case

But sometimes do if Ds have substantial counterclaim

146
Q

Usual chance of success required for after-the-event insurance and TP funding?

A

at least 60%

(nb usually over 50% for before-the-event)

for tp funding will also want sizeable sum likely recoverable

147
Q

SRA code of conduct risks where TP funding?

A

breaching client confidentiality

conflict of interest if TP have excessive influence over the case

148
Q

Requirements for law firm to carry out legal aid work?

A

Contract with Legal Aid Agency relevant to type of work they are offering
eg criminal

Subject to annual audit from Legal Aid Agency

149
Q

If there is third party funding over a case and client loses, who pays opponent’s costs?

A

Discretion of court

If TP had lots of control over the case, they could be liable for all of it

150
Q

Can law firms (who are registered for legal aid) decline instructions in legal aid cases?

A

Yes

Except duty solicitor scheme

151
Q

Duties of law firms authorised for legal aid to Legal Aid Agency?

Does this override any duties to clients?

A

Tell them if client acts unreasonably
(eg refuse settlement offer)

Or if client gave Legacy Aid Agency misleading info

Overrides duty confidentiality to client

152
Q

Who do legal aid solicitors get their fees from?

A

Legal Aid Agency at end of case

(usually get less than would if private client)

153
Q

Additional duties of solicitor acting for a legal aid client?

A

Inform the court and other parties that legal aid client

Seperate duties to Legal Aid Agency (sep queue card)

154
Q

2 categories of CIVIL Legal Aid work, what falls into those categories and explain the difference?

A
  1. Controlled work
    (legal help and help at court)
    - solicitor decides if client eligible for controlled work
  2. Licensed work
    (legal representation)
    - legal aid agency decide if client is eligible on case-by-case basis
    (licensed begins with L, as does Legal Aid)

(makes sense - legal representation is more signif so right that LAA make decision)

155
Q

3 types of legal aid available in civil law and whether it is controlled or licensed work?

Brief explanation of each.

A
  1. Legal help
    CONTROLLED
    - basic advice and limited next steps
    e.g. drafting a letter
    (maybe ACAS?)
  2. Help at court
    CONTROLLED
    - advice and assistance, inc advocacy
    - must relate to specific hearing instead of case generally
    e.g. possession proceedings, assist client in putting argument to court re postponing eviction
  3. Legal representation
    LICENCED
    - either party to proceedings or considering commencing proceedings
    - can cover up to and including representation at court
156
Q

nb family law and immigration not subject to standard civil legal aid rules but don’t need to know the subject-specific rules

A
157
Q

Difference between help at court and legal representation (civil legal aid)?

A

help at court is limited to advice in relation to particular proceedings (does inc advocacy)
e.g. in putting arguments to court to delay eviction

legal representation can cover conduct of client’s case, up to and including representation at court

help at court is controlled = up to solicitor to decide if eligible
legal rep is licensed = Legal Aid Agency must decide if eligible

158
Q

Legal representation can be granted on ___ or ____ basis.

Explain the difference.

(civil law)

(clue: varies how much aid will receive)

A

Full or investigative.

Investigative
- covers solicitor’s work in assessing strength of case

Full
- covers issuing and conduct of proceedings, inc advocacy

159
Q

What do legal aid agency grant if they approve application for civil legal aid?

can this be limited?

A

Legal aid certificate

yes:
- cert usually restricts extent of representation which solicitor can given
and/or sets max amount can pay

If solicitor thinks will require more work, must apply for amendment to certificate and/or costs inc

160
Q

What CIVIL cases will legal aid be / not be available for?

Is there an exception……

A

Yes, inter alia:
- homelessness
- family domestic abuse
- discrimination
- immigration
- care proceedings

NOT for:
- business-related matters
- family disputes re children
- personal injury
- divorce
- cases financed by CFA

HOWEVER (!!!!!)
- even if falls outside scope, may obtain if “exceptional” circumstances; or
- LAA think refusal breach human rights
(if exceptional - still need to satisfy means and merits tests)

161
Q

If case falls within scope of legal aid/permitted anyway due to exceptional circumstances, what next hurdles must it overcome?

A

MERITS and MEANS tests

(i.e. merits of case and financial circumstances)

162
Q

Explain the merits test for legal help and help at court?

(civil legal aid)

A

‘Sufficient benefit test’
- sufficient benefit to client considering circumstances (personal circum and case itself)

163
Q

Explain merits test for legal representation?

(civil - legal aid)

A
  1. Decent prospect of success; and
    - Usually at least 50%; and
  2. General merits test or specific merits test; and
    (depending on nature of case)
    - monetary claim:
    amount likely to recover vs spend
    - non-monetary:
    if benefits justify likely cost a client would likely spend (i.e. ‘reasonably paying private client test’)
  3. Not other forms of aid available
    e.g. insurance or CFA
164
Q

What are the means test for civil cases?

A

(always combine with their partners)

Must not exceed:

  1. Capital:
    - £8000
    - or £3000 for immigration
    (if capital over £8k, no need to consider income)
  2. Income:
    - welfare benefits: automatically qualify income
    (still need to show capital ^)
  • monthly GROSS income: £2,657 or less
    (less if 5 or more kids)
  • if £2,657 or less - deduct living costs etc
    ( to arrive at monthly DISPOSABLE income)
  • must be less than £733
165
Q

When will a client who satisfies means test for civil legal aid still have to pay a CONTRIBUTION towards legal fees?

A
  • If is licensed work (ie legal representation); and
  • means test revealed can afford to pay contribution (even though below limits); and
  • monthly disposable income is over £315 or capital above £3k.
166
Q

What is the statutory charge in civil legal aid?

A

If client benefits financially by partially/fully winning case or settlement

any money or property received can be used in payment of solicitor’s fees.

Usually must have received legal representation.

167
Q

In what order will Legal Aid Agency try to recover fees it has paid solicitor?

A
  1. Any costs paid by other side
  2. If shortfall, any contribution paid by client under legal aid offer
  3. If still shortfall, money recovered or preserved in proceedings
    (eg client’s winnings)
168
Q

What must solicitor do to facilitate legal aid agency in collecting the statutory charge?

(i.e. any financial benefit client received can be used to pay fees of case)

(civil legal aid)

A

pass any money held for and payable to client under a court or order to settlement to Legal Aid Agency

(eg receive settlement fees from other side - instead of transferring to client, send to legal aid agency)

169
Q

Once received (usually by solicitor), when must property or assets be paid to legal aid agency for statutory charge purposes ?

A

immediately

unless property recovered is client’s home - LAA may agree to postpone enforcement of statutory charge

if do that ^, will register against title to property so fees recouped when property sold

170
Q

When can legal aid be offered on emergency basis?

A

for legal representation (re-cap: form of licensed work)

e.g. domestic violence threat or homelessness

urgent need advice and assistance

if application successful, LAA issue legal aid certificate

171
Q

what are rights of audience?

A

examine witnesses and appear before court

172
Q

when is litigation covered as a reserved legal activity?

A

issuing proceedings and commencing, prosecuting and defending them

e.g. laying info before court

173
Q

What are included and excluded as reserved instrument activities?

A
  • Preparing and lodging a formal legal document dealing with transfer or charge of land relating to real or personal estate; or
  • Instrument relating to court proceedings

Wills and powers of attorney excluded

174
Q

What counts as ‘conduct of litigation’, for activity to be classed as reserved?

A
  1. Issuing proceedings any court
  2. Commencing, prosecuting and defending proceedings
  3. Performing ancillary function to proceedings
    e.g. entering appearances to actions
  • e.g. laying info before mags = commencing

e.g. online divorce facilitator (assists drafting docs to obtain divorce)
- was not litigation where parties lodged docs at court themselves

  • narrowly construed because potential criminal offence if not authorised/exempt
  • any legal advice in connection with court proceedings / correspondence with opposing party not count
175
Q

What are ‘reserved instrument activities’ for purposes of being reserved legal activity?

A

preparing / lodging formal legal doc

dealing with transfer or charge of land relating to real or personal estate

or relating to court proceedings

some docs excluded
eg wills / powers of attorney

176
Q

requirements before can carry out reserved legal activities ?

A

authorised by approved regulator; or

exempt

177
Q

Approved regulator for solicitors and who carries out regulatory function?

A

Law Society approved regulator

Regulatory function carried out by SRA

178
Q

Who authorises solicitors to carry out reserved legal activities?

A

SRA for all except notarial activities

179
Q

Main examples when someone WILL be able to carry out reserved legal activities due to exemption?

A

Rights of audience if granted by court for particular case
(e.g. MacKenzie friend)

Probate - if employee acting under supervision of authorised person

Some exemptions for charities and trade unions

180
Q

Penalties if carry out a reserved legal activity if not authorised or exempt?

A

criminal offence up to 2 yrs imprisonment

Rights of audience/litigation - also contempt of court

181
Q

Who oversees regulation of lawyers?

A

Legal Services Board (LSB)

i.e. a regulator can only regulate lawyers if it is LSB approved / regulated

(e.g. SRA is regulated and approved by LSB)

LSB responsible for oversight of regulation but does not authorise firms !

182
Q

Legal Services Board have duty to promote what objectives?

A
  • Public interest
  • Rule of law
  • Improve access to justice
  • Consumers
  • Competition in legal sector
  • Effective legal profession
  • Public understanding of citizen’s rights and interests
  • Adherence professional standards

(those regulated by LSB subject to same objectives/comply with - inc SRA)

183
Q

Can individuals instruct a barrister or must a solicitor do it for them?

A

Yes in some civil cases

184
Q

Authorisation/regulation for CILEX?

A

Can’t work independently and must be supervised by solicitor

Can be involved in ownership of firm

Regulator is CILEx Regulation
- who can authorise to provide all types reserved legal activities except notarial

185
Q

Who regulates barristers and can they be authorised to do all types of reserved legal activities?

A

BSB

All except notarial

186
Q

Who is approved regulator for licensed conveyancers and what reserved legal activities can they authorise?

A

Council for Licences Conveyancers

Conduct reserved instrument activities, probate activities and administer oaths

187
Q

Trade marks and patent attorneys - approved regulator and what reserved legal activities can they be authorised to do?

A

Intellectual Property Regulation Board

All except probate and notorial

188
Q

Costs Lawyers - who regulated by and what reserved legal activities?

A

Costs Lawyers Standard Board

Rights of audience, conduct litigation and administer oaths

189
Q

Which body can authorise notaries ?

A

Master of Faculties

190
Q

Who regulates claims management companies?

A

FCA

191
Q

Main examples of legal services which aren’t reserved and therefore not regulated?

A

○ Will writing (WH Smith), family law advice (J my gyal) and employment law advice (peninsula/ACAS)

Some voluntarily self-regulate (e.g. code of conduct)

192
Q

Who are the approved regulators for reserved legal activities?

A

∘ Solicitors Regulation Authority
∘ Bar Standards Board
∘ CILEx Regulation
∘ Council for Licensed Conveyancers
∘ Intellectual Property Regulation Board
∘ Costs Lawyers Standards Board
∘ Master of Faculties

NB: if firm offering conveyancing services, firm must be authorised
(not just the individual)

193
Q

If authorised by SRA, will firm be subject to SRA-regulation in respect of ALL legal services it carries out or just reserved legal activities?

A

All

194
Q

SRA takes _____ approach to regulation?

A

Risk-based

i.e. misconduct most likely harm public interest

e.g. huge firm or lots of complaints

195
Q

What does SRA see 2 main purposes of its regulation to be?

A

protect consumers of legal services

support RoL/admin justice

196
Q

What does SRA Code of Conduct require firms to do in terms of own risk management?

A

Identify, manage and monitor all material risks to business

197
Q

What 3 types of businesses can seek authorisation from SRA?

A
  1. Recognised sole practices
    (e.g. Kelcks - often employ ppl but responsible for whole firm)
    (rare cos annoying eg if wanna go on holiday/tech)
  2. Recognised bodies
  3. Licensed bodies
    - ASBs
198
Q

What is a ‘legal services body’?

(NB: this is one of the businesses which can be authorised by SRA)

A

Most law firms

All managers and interest holders legally qualified

At least 75% managers legally qualified and those who aren’t are approved by SRA.

And 75% shares held by legally qualified people.

(badly worded in textbook with legally qualified thing but that’s what it says ^ doubt need to know numbers)

Usually partnerships, LLPs or companies

199
Q

What will be licensed body, for purposes of being eligible for SRA authorisation?

(Nathans)

A

ASBs

Can be owned/managed by people who aren’t legally qualified

Must be at least one manager authorised by SRA or another approved regulator

And, to count as licensable body, one of following must apply:

  • Non-authorised person is a manager or shareholder; and/or
  • Another company manages/holds interest in it and 10% voting rights within that other company are held by non-authorised people
200
Q

What is the effect of SRA authorisation?

(clue: there are things you are now authorised to do but also things which you have to do)

A

Can carry out reserved legal activities EXCEPT notarial

Must always have COLP and COFA (SRA approved)

If a licensed body, they are termed HOFA and HOLP

(bit confusing and doubt need to know but also business is limited to professional services provided by individuals practising as lawyers of other jurisdictions - doesn’t make sense to me so ignore I think)

201
Q

How to apply for SRA authorisation?

What responses can SRA make to application?

A
  • Apply SRA if want carry out reserved legal activities or immigration work
  • SRA investigate
    (risk-based approach to investigation)
  • may grant blanket authorisation, authorise provision of SELECTED services or refuse
  • SRA goal of enhancing public confidence etc

FYI some firms don’t need to be authorised because legal services and not restricted legal services but do anyway to reassure clients

202
Q

Penalty for practising without practising certificate?

A

Criminal offence

203
Q

Requirements to be AUTHORISED as solicitor and be able to act as solicitor?

(those 2 things mean same - clue: focus on word AUTHORISED)

A

○ Admitted
○ Name on roll; and
○ Has a certificate

(NB: This is different to admission requirements)

204
Q

When will someone be ADMITTED as a solicitor?

A
  • relevant qualifications
  • training
  • character and suitability requirements
205
Q

other than solicitors, who else needs to meet SRA character and suitability requirements?

A

anyone applying to become authorised role holder in a firm
e.g. COFA

former solicitors seeking restoration to role

206
Q

Part 1 of what SRA will consider re character and suitability?

(clue: broad principles)

A

the need to protect public

consider on case-by-case basis to individual circumstances

207
Q

SRA character and suitability assessment:

What criminal behaviour will be relevant?

A
  1. most serious = likely refuse
    - dishonestly, perjury, fraud, bribery, violent/sexual, obstructing course justice, discrimination
    - or caution for dishonesty, violence, sexual or discrimination
  2. Serious = may refuse
    - ^ caution or custodial sentence for any offences not above
    - or if received conditional discharge/bind over
208
Q

SRA Character and Suitability Assessment

What non-criminal conduct may be taken into account?

A

□ Dishonest, violent, threatening, harassing, discrimination
□ Deliberate assessment offence e.g. plagiarism
□ Avoiding responsibility for debts, dishonesty, managing finances, declared bankrupt/can’t manage finances
Serious disciplinary or regulatory findings or sanctions

209
Q

Disclosure requirements of individual Character and Suitability Assessment?

A

disclose all matters inc overseas which are relevant

provide any further info requested by SRA

failing disclose taken into account by SRA during determination

ongoing obligation to report new matter or any changes

210
Q

When can solicitor who has been admitted to role apply for practising certificate?

A

not suspended and sufficient written/spoken Welsh and English

211
Q

What rights of audience does a solicitor with practising certificate have?

A

has rights of audience in all courts

but cannot EXERCISE in HIGHER courts (ie Crown upwards) until got specific qualification

212
Q

Does solicitor need to perform reserved legal activities through an authorised body?

A

Yes

Imp e..g pro bono work if not done through firm

  • would need to rely on an exemption
213
Q

When to apply to SRA for renewal practising certificate?

A

Due for renewal 31 Oct Halloween each year

Pay fee

214
Q

Solicitor must inform SRA ____ of any ___ changes about self or practice

A

Promptly

Material

215
Q

When MUST SRA refuse application for practising certificate?

A

Public interest to do so

216
Q

When could SRA impose conditions on practising certificate?

A

§ Unsuitable to undertake certain activities
§ Likely risk interests clients/TP/public
§ Probs wont comply with/needs monitoring re SRA regulation; or
§ Should take specified steps conducive to regulatory objectives

Must specify these requirements / restricted activities etc

217
Q

When are freelance solicitors not required to be authorised by SRA?

What are they still required to do?

A

A) non-reserved activities (family, employment, personal injury);

B) Any reserved legal activities provided through an authorised BODY; OR

C) Meet certain requirements
e.g. practised for min three years, self-employed, practise in their own name, INDEMNITY insurance, not employ and only limited categories client money

Must still:
- notify SRA intend to practice
- SRA put their details on public register

218
Q

If SRA refuse granting practising certificate or attach conditions, who can you apply to review?

A

SRA itself

or High Court

219
Q

Do non-commercial organisations providing legal advice need to be authorised?

Can solicitors working for them provide reserved legal activities to public?

(eg charities, trade unions)

A

No

Solicitors can provide to public ONLY on behalf of employer

But must be covered by professional indemnity insurance

220
Q

solicitors practising in which bodies aren’t required to have adequate and appropriate insurance?

and which aren’t required to meet SRA MINIMUM standards of insurance?

A

Do need:
- sra authorised
- freelance or non-comm org if reserved
(non-comm org - duty to check if organised)

Don’t need adequate and appropriate (ie the minimum) if:
- in-house
- freelance or non-commercial orgs and providing NON-reserved
(ie employment, family, PI)

221
Q

Who is liable to pay remainder if professional indemnity insurance doesn’t cover costs?

A

The solicitor
(not the firm)

222
Q

What must firm do if can’t get insurance cover once one cover ends?

A
  • minimum Ts and Cs of qualifying insurers will mean extends for 90 days
  • inform SRA
  • if can’t find another after 30 days, notify SRA and can’t take any new work
  • If can’t find another after 90, cease practising
223
Q

Can in-house solicitor provide reserved legal services to public?

A

No

To their employer only

224
Q

SRA MINIMUM requirements for professional indemnity insurance?

(inc how much must take out cover for)

A
  • list of participating insurers
  • recognised and licensed bodies: cover at least £3m exc defence costs for one claim
  • £2m all other cases
    (e.g. sole traders or not claims)

(can’t attempt to exclude liability below this)

  • Everyone employed covered
  • Must be continuous
225
Q

Can solicitor provide regulated legal services to public if working for commercial unregulated org?

A

No

But can provide legal services
(just not reserved)

226
Q

ADDITIONAL SRA insurance requirement

Must be ____ and ____

What constitutes ^ ___ and ___ insurance ?

A

adequate and appropriate

  • for firm/solicitor to decide on individual circumstances
    eg type of clients, claims could be made
  • keep under review
  • may require top-up from minimum Ts & Cs
227
Q

Duty of solicitor in non-commercial organisation re insurance?

A

Duty on them to check that the body has arranged insurance for them

228
Q

Can solicitors ever exclude or limit liability below the minimum SRA insurance requirements

A

only freelance or or solicitors working for non-commercial bodies re unreserved activities

pi family emp

229
Q

What information must solicitors provide to clients re professional indemnity insurance?

A

Must make available:

  • info re firm’s compulsory level of indemnity insurance
    , inc name of insurer and territorial coverage

AND

Freelancers providing RESERVED legal activities to public must inform clients that they are not required to meet the minimum Ts and Cs

AND

MUST tell if insurance cover may influence client’s decision to instruct
- e.g. probs unwilling instruct over £10m claim if indemnity cover is £5m

230
Q

Can SRA authorised firms limit their liability?

A

Yes but not beyond minimum level under SRA minimum Ts and Cs

But must have regard to professional conduct limits etc

231
Q

Can solicitor be admitted onto roll without practising certificate?

A

Yes

(but cannot be solicitor w/o practising certificate)

232
Q

which courts enforce Equality Act?

A

Civil courts

nb employment claims dealt with in employment tribunal

Otherwise brought in County Court

233
Q

What are protected characteristics under the Equality Act?

A
  • race
    (inc gypsies)
  • religion and belief
    (relate to substantial part of human life, worthy of respect and cogency)
  • sex
  • sexual orientation
    (covers heterosexual, bi and gay)
  • gender reassignment
    (includes if propose to undergo treatment - no requirement for medical supervision)
  • maternity/pregnancy
  • age
  • disability
  • marriage/civil partnership
234
Q

Which protected characteristic requires positive steps to be taken?

A

Disability

235
Q

What constitutes disability under Equality Act?

A

Physical or mental impairment

substantial or long-term effect on ability to carry out everyday activities

Includes HIV

High threshold

236
Q

What are the three elements of direct discrimination under equality act?

Explain each limb.

A

(overt and obvious)

Treat someone less favourably than would others due to their protected characteristic.

  1. Comparator
    - real person or if not available, hypothetical
    - circumstances materially the same
  2. Less favourable
    - any disadvantage will suffice / doesn’t have to be tangible
    - intention irrelevant
    (although may be relevant when comes to remedies)
  3. Because of their protected characteristic
    - does not need to be main reason, just an influence
    * doesn’t matter if don’t actually have that characteristic * !!!!
    e.g. thought Muslim but weren’t
237
Q

When will there be a defence to direct discrimination?

A

Defence of justification

Only if relates to age

NO discrimination if proportionate way of achieving legitimate aim

238
Q

What protected characteristic does indirect discrimination not apply to?

A

Maternity and pregnancy

So ^ can only claim for direct discrimination

239
Q

When will there be a claim for indirect discrimination?

A

Provision, criterion or practice is of universal application

but has adverse impact on those sharing a protected characteristic

and is not proportionate means of achieving a legitimate aim

e.g. requires employee to work full time, could disadvantage women as a group because childcare responsibilities
- employer may justify as needing a full-time worker

240
Q

Additional option for disability discrimination under Equality Act?

Is there a defence?

A

Treats unfavourably due to something arising in consequence of disability

No need to compare behaviour to others

Must have known or reasonably ought to have known about their disability

May justify if can show proportionate means of achieving legitimate aim

(can still use direct or indirect, but may be easier to use this since no comparator required)

241
Q

What is victimisation under Equality Act?

Do you need protected characteristic?

A

No need PC

Subject to detriment because done or believe has/may do a ‘protected act’

Protected Act means:
- bringing proceedings under EA
- giving evidence/info in EA proceedings
- alleging another breached EA
- doing anything related to provisions of act

Detriment means putting at disadvantage or making position worse

e.g. witness in proceedings and singled out at next pay review

242
Q

What is harassment under Equality Act?

Conditions? Must it relate to a PC?

A
  1. unwanted conduct which relates to a PC and:
  • violates dignity; or
  • creates intimidating, hostile or offensive environment

^ applies to all except pregnancy/maternity, marriage and civil partnership

  1. OR
    - unwanted conduct of sexual nature; and
    - same effect as above ^
    DOES NOT NEED TO RELATE TO A PC
  2. OR
    - unwanted sexual conduct or relates to gender reassignment; and
    - treat less favourable due to rejection of or submission to the conduct
    - DOES NOT NEED TO RELATE TO A PC
243
Q

Three requirements to DUTY to make reasonable adjustments?

(duty means take positive steps…clue)

A

Only relates disability

Disabled person must be at a SUBSTANTIAL disadvantage
(ie more than minor)

  1. Provision, criterion or practice
    - reas steps to avoid the sub disadv
  2. Physical features
    - reas steps to avoid the sub disadv
  3. Provide auxiliary aid
    - reas steps to provide the aid
244
Q

Why are solicitors subject to anti-discrimination provisions of Equality Act?

Will they always be?

A

Because they are a service provider

Service provider can be individual or business

So solicitors providing legal services, even if unregulated or not receiving payment

245
Q

What is it unlawful for service providers under Equality Act?

A

Can’t harass (due to PC)

Can’t discriminate (due to PC) or victimise by:
- refusing to act
- providing services on less advantageous terms
- terminating retainer
- subjecting to any detriment

^ applies to all PCs except marriage/civil partnership or age if under 18

246
Q

Does vicarious liability apply to acts of discrimination? Is there a defence?

A

Yes

But defence if took steps as were reasonable to prevent the specific act of discrimination or acts of that description

Must have taken those steps BEFORE the action occurred

247
Q

What adjustments must law firms make as SERVICE PROVIDER?

When can claim be brought for failure to do so?

(nb - this goes beyond the basic duty to make adjustments)

A

Reasonable adjustments for disabled people:

  • Physical features
    ○ Discriminated if no reasonable steps to avoid disadvantage / adopt alternative way provide service
    ○ Can’t pass on costs for adjustments
  • applies even if don’t currently act for disabled or anticipate that will in future

○ E.g. make building wheelchair accessible

  • Must be affected by adjustments to claim

To determine whether “reasonable”
- Consider cost, nature service and size firm

248
Q

Burden of proof equality act claims?

A

Initially on claimant to show prima facie case

Burden then shift to D

if prima facie case, court must find breach of legislation unless D can prove otherwise

249
Q

Remedies available for Equality Act?

Is there a limit on award?

A

Any remedy which High Court could make in tort or judicial review
(regardless of court deciding)

Or if in ET, unlimited compensation
(intend to put as if wrong occurred - eg loss of bonus, injury to feelings also possible - and can make declaration or recommendations)

Usually damages
(can also be injunctions/declarations)

No limit on damages

Sometimes damages for injury to feelings

Can be aggravated

Can be punitive

If firm and employee both liable, don’t get double compensation unfortunately - will be jointly liable

250
Q

Under Equality Act, what protections are available to a prospective employee?

A

Must not discriminate or victimise in:
- arrangements for deciding who to offer job to; or
- terms of employment; or
- by not offering employment

Must not harass

251
Q

Protections available under EA for current employees?

A

Can’t discriminate or victimise re:
- terms of employment; or
- way provides opportunities for promotion, transfer, training, or receiving any other benefit/service; or
- by dismissing; or
- subjecting to any detriment.
(detriment = reas employee view been disadvantaged - no need physical/financial consequence)

Can’t harass

252
Q

Where may discrimination against employees be lawful?

A
  • Can demonstrate nature of job only those with a particular PC able to do it (this benefits person with the PC) and proportionate means legit aim
  • E.g. RC for head teacher to be RC

Usually irrelevant solicitors

253
Q

What adjustments must employers take for disabled employees or prospective employees?

A
  • Reas adjustments for disabled employees/prospective
  • unlike for service providers, only if do or should reasonably know disabled

E.g. GLD failed to give Asperger’s MCQs

(if fail to, will be discrimination)

254
Q

Who can an employee or prospective employee CONSIDERING brining Equality Act claim do to assist them?

A

Submit Qs to employer to determine whether have a claim

Will then have to do ACAS early conciliation before ET will accept claim

255
Q

What protections do barristers receive under EA?

From who?

A
  • Protected from discrimination by fellow tenants/pupils/clerks
  • Prospective tenants and pupils are too
  • Protected from DHV (disc har vict) by solicitors
    (discrimination only if subject to detriment)
256
Q

What is positive action under equality act?

A

can take SOME steps to redress disadvantages suffered by people with protected characteristics and will not be considered unlawful to do so

257
Q

What requirement must a firm satisfy to be able to lawfully take positive action under equality act?

A

(applies if using in capacity as employer or service provider)

  1. Firm REAS thinks:
    - PC suffer disadvantage; or
    - Have needs diff to others without the PC; or
    - Participation in activity by PCs is disproportionately low.
    (e.g. not going to football on Weds)

Show through something like a survey of clients or workforce

  1. Action taken must be proportionate means of achieving one of following legitimate aims:
    - Enabling to overcome / reduce that disadvantage; or
    - Meeting those needs; or
    - Enabling participate that activity

e.g.
specific training for some employees

258
Q

What positive action can a firm take in relation to promotion and recruitment?

A
  • Where thinks disadvantaged or disprop underrepresented
  • CAN (!!!!!) treat more favourably in recruitment process
  • ONLY if they are as qualified as other
  • Qualified not just exams etc but overall suitability - like a TIE-BREAKER where two just as good but one has a PC
259
Q

How does SRA Code of Conduct link to Equality Act?

A

Sometimes discriminatory behaviour which is permitted by act will not be permitted by SRA Code of Conduct

Because have broader duty not do discriminate

Also Principle requires EDI so positive duty not to discriminate

Applies to conduct outside of practice

Discrimination is higher end of seriousness in SRA Enforcement Strategy

Also treating people with respect etc includes not just just clients but counsel/witnesses/judiciary etc

260
Q

What circumstances does Equality Act make discrimination unlawful in?

A

not super imp but

workplace / education etc

service providers

anyone who sells goods or provides facilities.

applies to all your services, whether or not a charge is made for them

261
Q
A

legal services (1 decks)

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