Ethics and Professional Conduct

Question 1

What are the 7 Mandatory Principles?

Answer 1

A solicitor must act:
1. in a way that uphold rule of law and proper administration of justice
2.in a way that upholds public trust in solicitors’ profession
3. with independence
4. with honesty
5. with integrity
6. in a way that encourages equality, diversity and inclusion
7. in the best interest of each client

Question 2

What happens if two principles come into conflict?

Answer 2

The one that safe-guards the wider public interest will take precedence.

Question 3

Does a solicitor have to provide reasonable adjustments for clients?

Answer 3

Yes.
Solicitor has a duty to provide reasonable adjustments to ensure that disabled clients and employees are not at a substantial disadvantage.

Question 4

What other ways must a solicitor act in order to maintain trust and act fairly?

Answer 4

1. not discriminate unfairly - by letting personal views affect their professional relationships
2. must not abuse your position/take unfair advantage of another party to a transaction who is unrepresented.
3. Mislead another party or the court

Question 5

What is an undertaking?

Answer 5

A statement, orally or in practise, to someone who reasonably places reliance on it, that you or third party will do something/refrain from doing something

Question 6

What happens if a support staff has spoken to someone on telephone and promised to do something?

Answer 6

If the other party has placed reliance on that statement and it is not performed, they can claim an undertaking has been given and has been breached

Question 7

What happens if an undertaking has been breached?

Answer 7

solicitor is personally bound to comply with undertaking

It can be enforced by the courts. party who was given an undertaking can seek compensation for loss.

no power to enforce an undertaking by SRA, LeO, SDT but a breach may be breach of professional conduct

Question 8

How must a solicitor deal with evidence and witnesses?

Answer 8

1. Must not misuse or tamper with evidence or seek to influence substance of evidence
2. must not provide any benefit to witness if this benefit is dependant on nature of case or outcome of case

exception - solicitor may pay witness for legitimate travel expenses or lost wages

Question 9

What is the Solicitors duty in respect to the court?

Answer 9

1. Must not waste the courts time. Everything made to court
   2.comply with court orders
2. make the court aware of relevant case law and statute law
   - if opponent fails to mention relevant case you must disclose it even if it would harm your clients position
3. if court is mistaken as to important info on client, solicitor has a duty to urge the client to correct the information and cease to act if the client refuses.
4. if solicitor discovers that their client committed perjury whilst testifying, solicitor must immediately urge the client to tell the truth and refuse to continue if they don’t

Question 10

Who can instruct a solicitor on a matter

Answer 10

A solicitor can act on instructions only from the client or from someone authorised by the client to instruct the solicitor

Question 11

What happens if a solicitor represents two people jointly and the clients directs them to take instructions from only one of them?

Answer 11

Solicitor may follow this instruction as long as they ensure the other client truly agrees.

Question 12

What happens when someone holding a Power of Attorney for a mentally incompetent client instructs a solicitor on a transaction?

Answer 12

If the solicitor does not believe it is in the best interest of the client (who is still the mentally incompetent person and not the POA) they should refuse to act.

Question 13

What duties do solicitors and firms have in terms of service and competence?

Answer 13

1. Firms and Solicitors are responsible for ensuring the solicitor keeps up to date on developments on law relating to their service
   2 Solicitor owes client duty of competent representation. Cannot accept instructions regarding issues they are unfamiliar with or able to timely gain knowledge on
2. take into regard each clients attributes and deliver information in a way suitable for the client.
3. supervising solicitor is accountable for work carried out and must effectively supervise solicitors and other staff
4. management must ensure individuals are competent to carry out their role

Question 14

What should the Solicitor do if they receive financial benefit as a result of the client’s instructions?

Answer 14

Must account to the client unless client has agreed otherwise
Solicitor can keep fees for referral only if they inform client and they agree
Applies broadly

Question 15

What is the Solicitor’s duties in accordance to client money and assets?

Answer 15

Solicitor has a duty to protect the clients assets. This can be breached through negligence

Must not hold client money unless it relates to advance payments of fees and expenses

Question 16

What are firms and solicitors’ business requirements for referrals and introductions?

Answer 16

1. Client must be informed of Interest (financial or other)
2. Fee Sharing Agreement - all fee sharing arrangements must be in writing and client must be informed (case cannot be criminal, personal injury or death claim)
3. Can refer client for ancillary services (cannot include solicitor in its name) if solicitor owns interest in other business if they inform client of interest and they accept.

Question 17

What referrals are prohibited?

Answer 17

1.Cannot pay or receive referral fee in criminal case

2. Cannot pay or receive referral fee with respect to personal injury case.

Question 18

What 2 actions require the client’s informed consent? (from firms and solicitors )

Answer 18

1. referring recommending or introducing the client to a separate business
2. Dividing a client’s matter between you and separate business

Question 19

What other business requirements are there for solicitors/firms?

Answer 19

1. Must only associate with authorised bodies (recognised by the SRA)
2. If holding a practising certificate, must provide annual return in the prescribed form
3. Must maintain adequate indemnity insurance
   -if carrying out reserved legal activity in non-commercial body, must take out adequate and appropriate indemnity insurance cover for all services provided

Question 20

Under the Legal Services Act 2007, what are reserved legal activities as?

Answer 20

1. Exercising right of audience (appearing and addressing a court/ calling and examining witnesses)
2. Conducting litigation
3. Preparing instruments relating to real or personal estate
4. Preparing probate papers
5. Notarial activities
6. The Administration of oaths

Question 21

What are the duties of a firms Compliance Officer for Legal Practise (COLP)?

Answer 21

1. that all persons in the firm comply with applicable SRA regulations
2. a prompt report is made regarding any breaches
3. SRA is informed promptly of matters COLP reasonably believes should be brought to the SRA’s attention for investigation

Question 22

What are the duties of a firms Compliance Officer for Finance and Administration (COFA)?

Answer 22

1. All persons in the firm comply with obligations imposed on them by the SRA Accounts Rules
2. A prompt report is made regarding any serious breaches of the SRA’s Account Rules
3. The SRA is informed promptly of matters the COFA reasonably believes should be brought to the SRA’s attention for investigation

Question 23

What are the types of conflicts of interest?

Answer 23

1. Own interest conflict: conflict of interest between the solicitor/firm and the client
2. Client conflict: conflict between two or more clients

Question 24

What does a conflict relate to?

Answer 24

1. A same or related matter
2. general business interest is not sufficiently related to create a conflict situation
3. actual conflict AND significant risk of conflict
4. conflict covers entire firm - not just individuals

Question 25

What should a solicitor do if a conflict arises?

Answer 25

Before retainer: decline to act or only act for client who’s interests they can best represent for themselves

After retainer: should inform all clients and may decline to continue to act

Limited retainer: firm only acts on the aspect where there is no conflict and advises client to take independent advice on conflicted area

Clients CANNOT consent to conflict and ask solicitor to continue to act

Professional Embarrassment: decline to act due to considerations relevant to the firm

Question 26

What situations pose an own interest conflict

Answer 26

Solicitor must never act if there is significant risk of own interest conflict.

Financial Interest: in clients business

Beneficiary in will - client wants to leave significant gift for solicitor in a will the solicitor is drafting
-exception if ability to advice is not undermined

Personal relationship: should decline to act for claim against person you have a relationship with

Commercial interest in business adverse to the potential clients business (in litigation) - should not act

Employment claim from former employee

Solicitors own conduct in question

Question 27

What situation poses conflict between clients?

Answer 27

• a conflict exists when you owe separate duties to act in the best interest of two or more clients on the same or related mater and these duties conflict

Examples:
- acting for both buyer and seller in a sale
- acting for both investor and scheme they will be investing in
- 2 clients agreeing a commercial contract
- acting for clients who are seeking separately to purchase a particular asset/contract

Question 28

When can a Solicitor act in a conflict between clients?

Answer 28

Must not act UNLESS:

1. Substantially Common Interest: clear common purpose and strong consensus between clients. applys only when conditions are met:
   - clients’ informed consent in writing
   - safeguards confidential information
   - it must be reasonable to act
2. Competing for the same Objective: if attained by one client, will be unattainable by the others e.g. asset, contract, business opportunity through liquidation or auction through tender/bid/offer that is not public

Question 29

What is the duty of confidentiality and when can it breached ?

Answer 29

• duty continues even after representation and death
• can be breached even by receptionist allowing a visitor to see client information on the receptionist’s computer screen
• breach justified if necessary to prevent commission of a criminal offence that will result in SBH
• breach justified if necessary to protect a vulnerable person

NOTE: solicitor has near absolute duty to disclose information material to the retainer of which they are aware (even something you overhear at a dinner party)

Question 30

What does not create breach of the duty of confidentiality?

Answer 30

The client consents to the disclosure

Solicitor discloses clients will to an attorney under a LPA

There is a statutory requirement (tax to HM Revenue) or a statutory duty - e.g. money laundering

There is a court order or police warrant requiring disclosure

Solicitor is being used by the client to perpetrate a crime or fraud

Question 31

If a client asks firm to represent them in a matter adverse to former client B (which firm holds confidential material on), what can the firm do?

Answer 31

Accept new client if firm takes effective measure so there is no real risk of disclosure of former client confidential information

Obtain the former client’s informed consent, given or evidenced in writing

Decline to act

Question 32

What events must a Solicitor report to the SRA?

Answer 32

If they become insolvent
If they are charged with a criminal offence, even minor
Change in information that was peviously provided to the SRA that would make that information false or misleading
The Solicitor recieves criminal caution from the police

• should make report even if it discloses confidential information

Question 33

What should a Solicitor do if they become aware that another solicitor in the firm has committed serious breach of a regulatory arrangement

Answer 33

Must report it to the firm’s compliance officer for legal practise (COLP) on understanding that the COLP will report matter to SRA

• solicitor does not need to follow up with COLP unless they knew the COLP would not act on the matter
• reports to the SRA must be PROMPT and you must report any facts/matters capable of leading to a serious breach

Question 34

If a Solicitor accidently discloses extremely sensitive client information to a third party, what should they do?

Answer 34

Ask the third party to return or destroy information

Report disclosure to the firms COLP and to the client

Question 35

What is a serious breach under the Enforcement Strategy, Standards and Regulations?

Answer 35

• Abuse of trust
• Dishonesty
• Taking unfair advantage of clients and others
• Misuse of client money
• Sexual or violent misconduct
• Criminal behaviour

Question 36

SRA aggravating factors

Answer 36

• Deliberately or recklessly disregarding their obligations
• Demonstrating a lack of honesty or integrity
• Taking advantage of a person’s vulnerability
• Causing harm
• Pattern of repeated misconduct

Question 37

At the outset of a retainer, what should the solicitor do?

Answer 37

Must identify client and inform whether and how services you provide are regulated

Must give client information in a way that they can understand and ensure they are in position to make informed decision

Should give the client the best form of information as to the costs and this should be updated when substantial changes arrive

If a firm sends client care letter indicating costs estimate and fail to mention VAT, they may not charge extra for VAT

Question 38

How should a solicitor or firm handle complaints

Answer 38

At the outset of the retainer, the solicitor must form client in writing of their complaints procedure, including:

• right to complain about services and charges
• how and when complains can be made
• right to take complaints to the Legal Ombudsman

Question 39

Where should the complaint procedure start?

Answer 39

Starts with firm or solicitor:
- must be handled fairly and free of charge
- if complaint is not resolved within 8 weeks, firm must inform client in writing of any right to complain to the Legal Ombudsmen and the procedure to do so

Question 40

Can Solicitor advertise their legal services?

Answer 40

Yes but:
- cannot make unsolicited approach to members of public to advertise (in a targeted or intrusive way)

• can approach current or former clients
• can place public advertisement
• can distribute leaflets to all homes in the community

Question 41

What is the SRA Transparency rules on solicitors with websites?

Answer 41

Must display information about pricing with regard to certain services:
1 residential conveyancing
2 motoring offence
3 probate
4 immigration (not asylum)
5 employment tribunals
6 debt recovery (up to 100k)
7 licensing applications (business premise)

+ provide total costs or range of costs and explain basis of charges, disbursements and VAT - when to make payments

must display digital badge to indicate they are regulated and provide link