Ethics and Professional Conduct Flashcards
1
Q
SRA Principles?
A
The SRA Principles comprise the fundamental tenets of ethical behaviour that the SRA expects those they regulate to uphold. The Principles apply to individuals and firms. All individual lawyers who provide legal services to client must comply with them. Please pause this recording to read them.
2
Q
Individual lawyers have duties to four categories of people?
A
· Firstly their clients. The 7th Principle is to act in the best interests of your client. CCS contains many obligations in respect of a solicitor’s duties to their client, some of which are listed on the slide.
· Secondly third parties – the legal profession must uphold public trust and confidence in the solicitor’s profession. They have a duty to their clients but also the court, and to the public generally. They must not mislead their clients or the court or other people and that includes members of the public they come across even in their private lives. They must not take unfair advantage of other people. If they undertake to do something, they must meet that undertaking – and this obligation applies not only to lawyers but to all members of staff in a law firm.
· Thirdly their colleagues: this relates to their responsibility to maintain their competence but also, if they supervise others, they must ensure that the work being done is correct and the people they manage are competent.
· Fourthly, they owe duties to the SRA and other regulators: they must cooperate with the SRA and they must ensure they can justify that their actions demonstrate compliance with the SRA’s rules.
3
Q
Code of Conduct for Firms (CCF) requirements for firms?
A
CCF requires firms to have systems in place to ensure compliance and manage risk. The SRA does not prescribe what systems, but firms must have effective governance structures, systems and controls to ensure that they comply with the SRA’s requirements and they must keep records to demonstrate compliance. Key obligations on firms in relation to the systems they must have in place are listed on this slide.
4
Q
Who are the ‘managers’?
A
a member of an LLP; a director of a company; a partner in a partnership; or in relation to any other body, a member of its governing body.
5
Q
Who is responsible for ensuring compliance with CCF?
A
managers’.
6
Q
Professional Indemnity insurance?
A
the SRA requires that law firms take out professional indemnity insurance
insurance should provide adequate and appropriate cover
7
Q
SRA has included requirements in CCS and CCF to ensure that legal professionals take steps to address these risks to the integrity of the legal profession. What does this include?
A
* to keep client money safe (CCS 4.2),
* not to take unfair advantage of clients (CCS 1.2),
* to ensure solicitors’ instructions reflect their client’s wishes (CCS 3.1),
* to address EDI (CCS1.1 CCF 1.5),
* to provide a clear complaints procedure (CCS 8.2-8.5), and
* to provide clear information the client can understand about the service they will receive and how much it will cost (CCS 8.6 and 8.7).
o There are also requirements to ensure you keep your legal knowledge up to date and that the work of junior lawyers is properly supervised
8
Q
Keeping your knowledge up to date obligations?
A
CCS 3.2: You ensure that the service you provide to clients is competent and delivered in a timely manner.
CCS 3.3: You maintain your competence to carry out your role and keep your professional knowledge and skills up to date
CCS 7.1: You keep up to date with and follow the law and regulation governing the way you work.
o The following is imposed on firms under CCF:
CCF 4.3:You ensure that your managers and employees are competent to carry out their role, and keep their professional knowledge and skills, as well as understanding of their legal, ethical and regulatory obligations up to date
9
Q
provisions in CCS and CCF on supervising client matters?
A
CCS 3.5: where you supervise or manage others providing legal services:
* (a) You remain accountable for the work carried out through them; and
* (b) You effectively supervise work being done for clients
CCS 3.6: You ensure that the individuals you manage are competent to carry out their role, and keep their professional knowledge and skills, as well as understanding of their legal, ethical and regulatory obligations, up to date.
CCF 4.4: You have an effective system for supervising clients’ matters.
o A Firm is responsible for ensuring that the Firm has a system in place for supervising client’s matters in order to achieve CCF 4.4.
This means that appropriate procedures need to be in place for suitable persons to check the quality of work undertaken for clients regularly. Although most persons supervising client files will have a legal qualification, such persons do not necessarily have to be legally qualified. As long as they have suitable experience, knowledge and competence to deal with any issue which may arise and such persons have clear guidance as to when and to whom issues outside their competence or authority should be referred ‘upwards’, they are permitted to supervise client matters.
10
Q
What does the SRA consider to be the key risks to the legal profession?
A
* Anti-money laundering
* Safeguarding client money
* Promoting diversity in the profession
* Information and cyber security
* Integrity and ethics
* Meeting legal needs
* Providing a high professional standard of service.
11
Q
Who does the SRA require law firms to appoint?
A
The SRA requires law firms to appoint both a Compliance Officer for Legal Practice(‘COLP’) and a Compliance Officer for Finance and Administration(‘COFA’).
12
Q
Role of COLP?
A
The role of the COLP is to ensure the firm complies with its legal and statutory obligations.
13
Q
Role of COFA?
A
The role of the COFA is to ensure the firm complies with the SRA Accounts Rules 2019.
14
Q
Who has the responsibility of compliance?
A
COLPS and COFAs do not have sole responsibility for compliance. Compliance is ultimately the responsibility of the owners and managers of the firm.
15
Q
Requirements for those to supervise work undertaken by the firm?
A
Firms must have a manager or employer or procure the services of an individual who has practised as a lawyer for a minimum of three years, to supervise the work undertaken by the firm.
16
Q
When does the requirement to have a COLP and a COFA operate?
A
must at all times
17
Q
COLP responsibilities?
A
* to ensure the firm complies with all the terms and conditions of authorisation by the SRA;
* to ensure the firm complies with its statutory obligations;
* to record any failures to comply with the firm’s authorisation or statutory obligations and make records available to the SRA; and
* to report any material failure to the SRA as soon as is practicable.
18
Q
COFA responsibilities?
A
* ensure that the firm complies with the SRA Accounts Rules 2019;
* report any serious breaches of the SRA Accounts Rules 2019 to the SRA promptly.
19
Q
Who is eligible to be a firm’s COLP or COFA?
A
o ALL of the following criteria must be satisfied. The COLP or COFA must:
* be a manager or employee of the authorised body;
* consent to the designation;
* not be disqualified from acting as a Head of Legal Practice (as defined in the Legal Services Act 2007 (‘LSA’)) or Head of Finance and Administration (as defined in the LSA) under section 99 LSA; and
* in the case of a COLP, be an individual who is authorised to carry on reserved legal activities by an approved regulator.
20
Q
Can someone be both a COLP and COFA?
A
o Yes, it is possible for the same person to fulfil both roles provided they have the necessary skills and fulfil all the criteria, but it is likely that this will only be the case for sole practitioners and some small firms.
21
Q
Managers’ responsibility for compliance?
A
Under the SRA Code of Conduct for Firms (‘CCF’) 8.1 managers have responsibility for compliance by the Firm with CCF. This responsibility will be joint and several with other managers of the firm.
22
Q
COLPs and CCF?
A
o The COLP is responsible (with the firm’s managers) for ensuring that appropriate systems are in place to minimise the risk of non-compliance with CCF.
o Meeting the standards in CCF 2 (Compliance and business systems) and CCF 4 (Service and competence) will be a major part of the COLP’s role. At the heart of these standards is the requirement that there must be a clear and effective governance structure and reporting lines: CCF 2.1.
o In addition, systems and controls need to be maintained, and the COLP will be expected to monitor, identify risk and take all reasonable steps to ensure:
* compliance with the terms and conditions of the Firm’s authorisation (CCF 9.1(a));
* compliance by the Firm, managers, employees and persons with an interest in the Firm, with the SRA’s regulation as it applies to them (CCF 9.1(b));
* the Firm’s managers and interest holders and those employed or contracted with do not cause or substantially contribute to a breach of the SRA’s regulatory arrangements (CCF 9.1(c)); and
* a prompt report is made to the SRA of any serious breach of the terms and conditions of the Firm’s authorisation or the SRA’s regulatory arrangements, which apply to the Firm, managers or employees (CCF 9.1(d)).
23
Q
Do managers or owners need SRA approval?
A
o Firms must ensure the SRA has approved any manager or owner of the firm under Part 4 of the SRA Standards and Regulations (AFR 9.1).
24
Q
Exceptions to anagers or owners needing SRA approval?
A
* a sole principal whose practice has been authorised as a recognised sole practice is not required to be approved as a manager of that practice;
* if the SRA is satisfied that a manager of an authorised body is not involved in any of the following:
* * day to day strategic management of the authorised body;
* * compliance by the authorised body with the SRA’s regulatory arrangements; or
* * the carrying on of reserved legal activities or the provision of legal services in England and Wales,
the SRA may decide that the authorised body is not required to comply with AFR 9.1.
25
Lawyer to supervise the work of the business?
o A firm must have at least one manager or employee or must procure the services of an individual who:
* is a lawyer of England and Wales and has practised as such for a minimum of three years; and
* supervises the work undertaken by the authorised body (9.4(a) and**(b) AFR**).
26
Reserved legal activities?
rights of audience,
* right to appear before and address a court
the conduct of litigation,
conducting activities in relation to reserved instruments which includes instruments relating to land and probate activities.
Notarial activities
Probate activities
Administration of oaths
27
Who do the SRA principles apply to?
o The Principles apply to individuals and firms.
28
7 SRA principles?
o The Principles require individuals and firms to act:
1. in a way that upholds the constitutional principle of the rule of law and the proper administration of justice
2. in a way that upholds public trust and confidence in the solicitors’ profession and in legal services provided by authorised persons
3. with independence
4. with honesty
5. with integrity
6. in a way that encourages equality, diversity and inclusion
7. in the best interests of each client
29
What happen if the SRA principles come into conflict?
o Should the Principles come into conflict, the principles which safeguard the wider public interest (for example the rule of law) take priority over the interest of an individual client.
30
What do the SRA principles relate to?
o The Principles relate to a lawyer’s relationship with their client and also the court, other professionals and the public.
31
When do the SRA principles apply?
o The Principles apply to legal professionals in their personal as well as their professional lives.
32
Code of Conduct for Solicitors, Registered European Lawyers and Registered Foreign Lawyers (‘CCS’)?
o CCS sets out the standards that the SRA and the public expect from individuals authorised by the SRA to provide legal services, including solicitors, paralegals and apprentices.
o CCS is a brief document, approximately eight pages long. It sets out a framework.
33
How are you compliant with the CCS?
o You are personally responsible for compliance with CCS.
o CCS 7.3 requires you to cooperate with the SRA and other regulators when they investigate concerns relating to legal services.
34
CCF?
o CCF sets out the standards and business controls the SRA expects of firms.
o CCF contains all the standards set out in CCS plus additional standards about the way firms run their businesses, including rules relating to:
the systems and controls firms must have in place to comply with the SRA’s rules
the responsibilities of managers of a firm
the requirement to have a Compliance Office for Legal Practice (‘COLP’) and a Compliance Officer for Finance and Administration (‘COFA’).
35
Limitation of acting in the best interests of your client?
o Although you must act in the best interests of each client, you must also act with independence, honesty and integrity. If the client wants to do something dishonest or illegal, you cannot help them do it.
36
What’s the difference between acting with honesty and acting with integrity?
o Integrity is broader than honesty.
For example, if you mislead a client or the court, you have not breached Principle 4 (honesty), but you have breached Principle 5 (integrity).
o Integrity is about being scrupulous, careful and accurate.
o The SRA might take action against an individual for lack of integrity where they have:
Taken unfair advantage of a client or a member of the public
Allowed another person to take unfair advantage of someone else
Misled another person or stood by and allowed another person to be misled
37
maintaining trust and acting fairly?
CCS 1.1 'You do not unfairly discriminate by allowing your personal views to affect your professional relationships and the way in which you provide your services.'
CCS 1.2 'You do not abuse your position by taking unfair advantage of clients or others.'
CCS 1.4 'You do not mislead or attempt to mislead your clients, the court or others, either by your own acts or omissions or allowing or being complicit in the acts or omissions of others (including your client).'
38
How does o 'You do not abuse your position by taking unfair advantage of clients or others.’ apply when the other party is unrepresented?
For example, you could be instructed on a matter and find yourself opposite a party with no legal representation. You should not take advantage of the other party’s lack of legal knowledge.
o If the unrepresented party produces a badly drafted document, you should suggest they find a lawyer. If they do not, you need to maintain a balance between acting in your client’s best interest and not taking advantage of the opponent’s lack of legal knowledge and drafting skills
39
What does misleading the client include?
Telling a prospective client they have a strong case in order to get the work, when they don’t.
Telling them the case is going well when it is going badly.
40
What does misleading the court include?
Not disclosing a case or statutory provision to the court which goes against the argument you are presenting for your client.
41
What does Misleading others include?
Making false representations on behalf of a client to a third party. For example, telling prospective purchasers of your client’s company that it is a good or bad deal. You should not give your personal opinion on the value of a deal to anyone involved.
42
What are the SRA’s requirements on Equality Diversity Inclusion?
o Principle 6: You must act in a way that encourages equality, diversity and inclusion.
o CCS 1.1 'You do not unfairly discriminate by allowing your personal views to affect your professional relationships and the way in which you provide your services.'
o CCS 1.2 'You do not abuse your position by taking unfair advantage of clients or others.'
o CCS 3.4 'You consider and take account of your client’s attributes, needs and circumstances.'
43
Guidance on the SRA’s approach to EDI?
Provide reasonable adjustments to disabled clients and employees to make sure they are not at a substantial disadvantage compared to those that are not disabled.
* You must not pass on the costs of providing these adjustments to others.
Encourage diversity at all levels of the workforce.
Collect, report and publish data about the diversity of your workforce.
Uphold the reputation of the profession in your professional and personal life and treat people fairly and with dignity and respect.
You should ensure your personal views do not have a negative impact on others. This includes expressing extreme personal, moral or political opinions on social media.
Be fair and inclusive in your interactions with people you meet and deal with in the course of your work.
44
What must firms do to comply with the SRA's obligations on equality, diversity and inclusion?
· have a complaints procedure and make sure complaints including those of discrimination, harassment and victimisation are dealt with promptly, fairly and effectively.
45
Do solicitors have to perform all undertakings?
o CCS 1.3 requires solicitors to perform all undertakings given by them, and to do so within an agreed timescale or if no timescale has been agreed then within a reasonable amount of time.
o Failure to perform an undertaking can be a serious disciplinary offence and most firms have systems in place to ensure that undertakings are complied with.
46
What is an undertaking?
'a statement, given orally or in writing, whether or not it includes the word 'undertake' or 'undertaking' to someone who reasonably places reliance on it, that you or a third party will do something or cause something to be done, or refrain from doing something'.
47
When can an undertaking be given?
o An undertaking can be given by any individual in a law firm provided it can be reasonably relied upon by the recipient. An undertaking could be given by a partner, a qualified lawyer, an apprentice, secretary or any other individual in the firm.
48
Form of undertakings?
The form of any undertaking should be ‘SMART’:
o Specific: be clear as to what is involved
o Measured: it must be capable of quantification
o Agreed: both sides must agree the wording
o Realistic: within solicitor’s control
o Timed: must not be of unlimited duration
49
What happens if there is ambiguity in the undertaking?
Any ambiguity in an undertaking will be construed in favour of the recipient.
50
What is a solicitor considered to be?
an ‘officer of the court’
51
What happens if a solicitor inadvertently misleads the court?
o A solicitor would not normally be guilty of misconduct if they inadvertently misled the court. Under the SRA’s Indicative Behaviours (which preceded CCS) if, during the course of proceedings the solicitor became aware that they had inadvertently misled the court, they must, with their client’s consent, immediately inform the court. If the client did not consent, the solicitor must stop acting for that client.
52
What happens if a solicitor becomes aware that their client has mislead the court?
, if a solicitor became aware that a client had committed perjury or misled the court or attempted to mislead the court, then the solicitor had to cease to act unless the client agreed to disclose the truth to the court.
53
Examples of misleading the court?
draft documents or construct facts supporting your client’s case which are not properly arguable;
* make any allegation of crime, misconduct or fraud unless it is material to your client’s case and you have reasonable grounds for doing so;
* call a witness whose evidence you know is untrue.
54
Other duties to the court?
CCS 2.1: You do not misuse or tamper with evidence or attempt to do so.
CCS 2.2: You do not seek to influence the substance of evidence, including generating false evidence or persuading witnesses to change their evidence
CCS 2.3: You do not provide or offer to provide any benefit to witnesses dependent upon the nature of their evidence or the outcome of the case.
CCS 2.4: You only make assertions or put forward statements, representations or submissions to the court or others which are properly arguable.
CCS 2.5: You do not place yourself in contempt of court, and you comply with court orders which place obligations on you.
CCS 2.6: You do not waste the court’s time.
CCS 2.7: You draw the court’s attention to relevant cases and statutory provisions, or procedural irregularities of which you are aware, and which are likely to have a material effect on the outcome of the proceedings.
55
How should you deal with clients?
Principle 7: You must act in the best interests of each client
CCS 3.2: You ensure the service you provide to clients is competent and delivered in a timely manner.
CCS 4.2: You safeguard money and assets entrusted to you by clients and others.
56
service and competence?
o CCS 3.2: You ensure the service you provide to clients is competent and delivered in a timely manner.
o An important part of providing a good service to your clients is to ensure that you are competent to do so.
o You need to ensure that you are competent to carry out the work you are required to do:
· You should not send work to a client unless it has been checked by your supervisor.
· If you do not know how to do the work, you must get help from someone.
· You also need to ensure that you keep your legal knowledge up to date in order to comply with CCS 3.3 and CCS 7.1.
o CCS 3.3: You maintain your competence to carry out your role and keep your professional knowledge and skills up to date.
o CCS 7.1: You keep up to date with and follow the law and regulation governing the way you work.
o CCS 3.4: You consider and take account of your client's attributes, needs and circumstances.
57
Managers' service and competence?
o Your managers also have an obligation to ensure that you are competent to carry out your work.
CCS 3.5: Where you supervise or manage others providing legal services:
you remain accountable for the work carried out through them; and
you effectively supervise work being done for clients
o CCS 3.6: You ensure that the individuals you manage are competent to carry out their role and keep their professional knowledge and skills, as well as understanding of their legal, ethical and regulatory obligations, up to date.
57
Safeguarding money and assets?
o CCS 4.2: You safeguard money and assets entrusted to you by clients and others.
58
Dealing with the court obligations?
o Principle 1: act in a way that upholds the constitutional principle of the rule of law, and the proper administration of justice.
o Principle 2: act in a way that upholds public trust and confidence in the solicitors’ profession and in legal services provided by authorised persons.
o CCS 2 contains more detailed provisions regarding your duty to the court. For example:
o CCS 2.1: You do not misuse or tamper with evidence or attempt to do so.
o CCS 2.2: You do not seek to influence the substance of evidence, including generating false evidence or persuading witnesses to change their evidence.
59
SRA’s requirements on publicity?
· o CCS 8.8: you ensure that any publicity in relation to your practice is accurate and not misleading, including that relating to your charges and the circumstances in which interest is payable by or to clients.
· CCS 8.9: you do not make unsolicited approaches to members of the public, with the exception of current or former clients, in order to advertise legal services provided by you, or your business or employer.
60
types of marketing approaches which would tend to demonstrate non-compliance with 8.9 CCS?
· in the street
· at ports of entry (i.e. to the UK)
· at hospitals
· at the scene of an accident.
61
Costs information for services?
o Authorised bodies who publish the availability of certain services to individuals and businesses must publish certain costs information on their websites. The services to individuals are listed in Rule 1.3 and include:
· conveyancing of residential property
· collection and distribution of assets following a person’s death
· immigration applications
· immigration matters
· road traffic offences
· certain advice to employees on unfair and wrongful dismissal.
o The services in relation to businesses are listed in Rule 1.4 and include:
· certain advice to employers on unfair dismissal and wrongful dismissal;
· debt recovery up to the value of £100,000; and
· certain advice in relation to licensing applications for business premises.
62
What costs information must be published?
o The costs information which must be published is listed in Rule 1.5 and includes:
· the total cost of the service or, where not practicable, the average cost or range of costs;
· the basis for the charges, including hourly rates or fixed fees;
· the experience and qualifications of anyone carrying out the work, and their supervisors;
· a description of, and the cost of, any likely disbursements;
· whether any fees or disbursements attract VAT, and if so, the amount of VAT;
· details of what services are included in the price displayed, including the key stages of the matter and the likely timescales for each stage and details of any services that might be expected to be included in the price displayed but are not; and
· if the firm uses conditional fee or damages based agreements, the circumstances in which clients may have to make any payments themselves for the services.
o The cost information published must be clear and accessible and in a prominent place on the website (Rule 1.6).
63
What costs information must be published? - Regulatory information
· An authorised body must display in a prominent position on its website, its SRA number and the SRA’s digital badge (Rule 4.1).
· An authorised body’s letterhead and emails must show its SRA authorisation number and the words 'authorised and regulated by the Solicitors Regulation Authority' (Rule 4.2).
64
Introduction?
“introduction” relates to a relationship you/a law firm has with a third party where the third party introduces or refers business TO YOU/THE LAW FIRM
65
Referral?
o “Referral” refers to an arrangement you/ a law firm might have with a third party TO WHOM you may refer or introduce clients
66
Conditions for introductions, referrals and fee sharing arrangements?
* CCS 5.1: in respect of any referral of a client by you to another person, or of any third party who introduces business to you or with whom you share your fees, you ensure that:
o clients are informed of any financial or other interest which you or your business or employer has in referring the client to another person or which an introducer has in referring the client to you;
o clients are informed of any fee sharing arrangement that is relevant to their matter;
o the fee sharing agreement is in writing;
o you do not receive payments relating to a referral or make payments to an introducer in respect of clients who are the subject of criminal proceedings; and
o any client referred by an introducer has not been acquired in a way which would breach the SRA’s regulatory arrangements if the person acquiring the client were regulated by the SRA.
67
How do referrals relate to Principle 7?
o Applying Principle 7, you must only act in your client’s best interests when referring a client to a third party.
68
What happens when Commissions received from third parties?
o If you gain any tangible benefit by making the referral (financial or otherwise), there is a danger of an own interest conflict (see CCS 6.1). You need to satisfy yourself (and it is likely that your firm’s Compliance Officer for Legal Practice (‘COLP’) will also need to be satisfied) that the referral is motivated purely for the benefit of the client and that any financial benefit to you/your firm is very much a by-product of the process
69
General commissions?
o Under CCS 5.1(a), you must properly inform your client of any financial or other interest (including an introduction fee) which you or your business or employer has in referring the client to another person.
70
Rules re introductions and referrals?
* Clients must be:
* informed of any financial or other interest which the introducer has in referring the client to you: CCS 5.1(a)
* informed of any fee sharing arrangement which is relevant to their matter: CCS 5.1(b)
* In addition:
* you are not permitted to pay to an introducer a fee for referring clients who are the subject of criminal proceedings or whose costs are partly or wholly being publicly funded: CCS 5.1(d).
* arrangements with introducers must be in writing: CCS 5.1(c).
* Any client introduced by a third party must not have been acquired in a way that would breach the SRA’s regulatory arrangements, if the person acquiring the client were regulated by the SRA.
71
Duty of confidentiality?
o You have a duty under CCS 6.3 to keep the affairs of clients and former clients confidential.
72
Duty of confidentiality for former clients?
Former clients include clients of a firm you used to work for and clients that used to instruct you but now instruct a different firm. It also continues to apply after a client’s death.
73
exceptions to the duty of confidentiality?
CCS 6.3: You keep the affairs of current and former clients confidential unless disclosure is required or permitted by law or the client consents
The duty does not apply where disclosure is required or permitted by law. A number of statutes empower the government and other bodies to require disclosure of documents, eg HMRC or the National Crime Agency, when investigating money laundering. You might also need to disclose information to comply with a court order.
o or in a criminal prosecution; cases involving children, where you discover that a child has been sexually or physically abused, even if the client who imparts the information refuses to permit disclosure, if you believe that the child's health (mental or physical) is in danger, you may have grounds to breach your duty of confidentiality by revealing the details to an appropriate authority.
74
Duty of disclosure?
o This is the principle that you make your client aware of any information material to their case of which you have knowledge.
75
What is the duty of disclosure limited to?
o In CCF 6.4, the duty is limited to information of which the individual solicitor is aware and does not extend to information of which others in the firm may be aware.
75
Exceptions to the duty of disclosure?
the disclosure of the information is prohibited by legal restrictions imposed in the interests of national security or the prevention of crime;
the client gives informed consent, given or evidenced in writing, to the information not being disclosed to them;
you have reason to believe that serious physical or mental injury will be caused to the client or another if the information is disclosed; or
the information is contained in a privileged document that you have knowledge of only because it has been mistakenly disclosed
76
Meaning of material for duty of disclosure?
information which 'might reasonably be expected to affect the client's decision-making with regard to their matter in a way which is significant having regard to the matter as a whole'
77
Informed consent?
the client must have some understanding of the importance of the information to their case, and any prejudice there may be in non-disclosure. This will mean giving some indication of at least the broad nature of the information to be withheld and its relevance to the matter.
78
What happens when there is a conflict between the duties of confidentiality and disclosure?
the duty of confidentiality takes precedence
79
What happens when there is adverse Interests between potential client and current/former client?
You do not act for a client in a matter where that client [Client Al has an interest adverse to the interest of another current or former client [Client B] of you or your business or employer, for whom you or your business or employer holds confidential information which is material to that matter"
80
Exception to the rule on adverse interests?
* effective measures have been taken which result in there being no real risk of disclosure of the confidential information; or
* the current or former client, B, whose information you or your business or employer holds has given informed consent, given or evidenced in writing, to you acting, including to any measures taken to protect their information.
81
What is the legal obligation to provide reasonable adjustments to disabled clients and employees?
Such that they are not placed at a substantial disadvantage compared to those who are not disabled.
Costs of the adjustment must not be passed on.
82
What are three ways in which a solicitor may mislead a client or the court?
1) Affirmative acts
2) Omissions
3) Being complicit in the acts or omissions of others
83
Who can give an undertaking?
Anyone, including non-lawyers
84
What is the duty where an undertaking is given dependent on a future event, and it becomes clear the event will not occur?
In what way is a solicitor bound by an undertaking?
Notify the recipient of the undertaking
Personally
85
What must witness compensation never be based on?
The nature of the evidence or outcome of the case
86
What standard must all assertions, representations, and statements made to the court be?
They must be properly arguable
87
What must you draw the court’s attention to?
Relevant cases and statutory provisions, and any procedural irregularities, which are likely to have a material effect on the case, even if it would harm your client’s case
88
If you have reason to suspect the authorised person’s instructions do not represent your client’s wishes, only when can you act?
When you are satisfied that the instructions reflect the client’s wishes
89
Is a solicitor allowed to represent, e.g. a husband and wife, and only take instructions from one?
Yes, provided it is established at the outset that the other party consents to the arrangement
90
What happens if a client’s instructions cannot be ascertained?
You must continue to act to protect your client’s best interests
91
What two things are required of the service provided to clients?
Competent (you have the skill)
Timely (you have the time to dedicate to the matter)
92
What must you do if you receive a financial benefit as a result of a client’s instructions?
Account to the client for it, unless the client has already agreed otherwise
93
What three situations would be governed by the standards concerning referrals and introductions?
1) You refer a client to a third party
2) A third party refers a client to you
3) You share your fees with a third party
94
What interests must a client be informed of when there is a referral?
Any financial or other personal interest you have in a referral
95
What are two requirements of fee sharing arrangements with third parties?
1. Must be in writing
2. Clients must be informed of any relevant fee sharing arrangement
96
What are two other types of cases in which the payment of referral fees is prohibited?
Personal injury
Death
(this includes ancillary claims in addition to the main claim)
97
What presumption does the SRA apply when it appears a prohibited referral fee has been paid?
The payment is presumed to be prohibited unless you demonstrate otherwise
98
What is required of a solicitor carrying out any reserved legal activities in a non-commercial body?
You must ensure that the body maintains indemnity insurance
99
Where a solicitor is carrying out reserved legal activities in a non-commercial body, what is the required scope of the insurance?
Adequate and appropriate cover in respect of all services (even those which are not reserved legal activities and would otherwise not require insurance but for the reserved legal activities)
100
Under the Legal Services Act 2007, what are six things considered to be reserved legal activities?
1. Exercising right of audience
2. Conducting litigation
3. Preparing instruments relating to real or personal property
4. Preparing probate papers
5. Notary services
6.Administration of oaths
101
What is the standard a firm must maintain in monitoring its business affairs?
A firm must actively monitor its financial stability and business viability, as well as all material risks to the business
102
If there are multiple managers in a firm, how is their responsibility split?
It is joint and several
103
What are five things within the purview of a firm’s Compliance Officer for Legal Practice?
1. Ensure compliance with terms of firm’s authorisation
2. Ensure compliance with SRA regulatory arrangements
3. Ensure the firm does not cause or contribute to a breach of the SRA’s regulatory arrangements
4. Ensure prompt report is made of any breach
5. Ensure SRA is promptly informed of any facts or matters the COLP believes the SRA may wish to investigate
104
What are three things within the purview of a firm’s Compliance Officer for Finance and Administration?
1. Ensure compliance with SRA Accounts Rules
2. Ensure prompt report is made of any breach of SRA Accounts Rules
3. Ensure SRA is promptly informed of any facts or matters the COFA believes the SRA may wish to investigate
105
What are the two types of conflict?
Own interest conflict: conflict between solicitor/firm and client
Conflict of interest/client conflict: conflict between two or more clients
106
What is not considered to be sufficient to create a conflict?
General business interest, e.g. two clients operating in the same industry, alone (unless related of course)
107
In a conflict situation, can a different solicitor within the firm act for the second client?
Generally, no. The conflict provisions cover the entire firm.
108
What must you do if a conflict arises before retainer?
1. Decline to act, or
2. Act only for the client(s) whose interests you can best represent
109
What must you do if a conflict arises after retainer?
1. Inform all clients
2. You can continue to act for one party, but be mindful of confidentiality issues going forward
110
Can a client consent to a conflict of interest?
No, the solicitor is bound if there is a conflict
111
What must you do if there is an own interest conflict or significant risk of one?
Decline to act
112
Are all financial interests in a client’s business an own interest conflict?
Yes
113
When might a client leaving a gift of significant value to the solicitor in a will not be considered an own interest conflict?
If the solicitor is satisfied the client has taken independent legal advice regarding making the gift
114
What is another exception to a client leaving a gift of significant value to the solicitor in a will being an own interest conflict?
If the solicitor’s ability to advise could not be said to be affected by the financial interest, e.g. drawing up parents will where solicitor and siblings are treated equally
115
Should you represent a client (1) against someone with whom you have a personal relationship and (2) when you have a commercial interest in a business adverse to the client?
No, you should decline to act in both situations
116
Can a solicitor advise a client on how to rectify a mistake that the solicitor has made?
Not if one of client’s options would be to bring a claim against the solicitor for professional negligence
117
What is the definition of client conflict?
What is a good test to consider whether you have a client conflict?
Where a solicitor owes separate duties to act in the best interests of two or more clients, and those duties conflict
If you are representing two or more clients in the same matter/retainer, and your advice to one is different than your advice to the other(s)
118
What must you do if there is a client conflict or significant risk of one?
Decline to act, unless one of two limited exceptions applies
119
What are the (1) substantially common interest and (2) competing for the same objective exceptions to a client conflict?
1. Two or more clients have a clear common purpose in relation to a matter and a strong consensus on how it is to be achieved
2. Two or more clients are competing for an objective, which if attained by one will make it unattainable for the other(s)
120
Regarding the competing for the same objective exception to a client conflict, what is an objective?
An asset, contract, or business opportunity via:
1. Liquidation or other insolvency process
2. Auction or tender process
3. Bid or offer which is not public
121
Even where there is a valid exception to a client conflict, what conditions must be met before you can act?
1. Client has given informed consent, given or evidenced in writing
2. Effective safeguards are in place to protect confidential information, where appropriate
3. You are satisfied that it is reasonable to act for all clients
122
In the context of the conditions required even when there is a valid exception to a client conflict, what should a solicitor consider when determining whether it is reasonable to act for all clients?
1. Will the clients benefit from the solicitor acting for each of them?
2. Will there be extensive negotiations between the clients?
3. Is there an imbalance in knowledge or bargaining power between the parties?
123
What are two instances in which you do not have to keep a client’s affairs confidential?
Disclosure is required or permitted by law
The client consents
124
What are five instances in which disclosure of a client’s confidential information is permitted by law?
1. Solicitor discloses client’s will to an attorney under Lasting Power of Attorney
2. Solicitor is being used by client to perpetrate a crime/fraud
3. Statutory requirement, e.g. disclosing tax affairs
4.Statutory duty, e.g. money laundering
5.Court order or police warrant
125
What are three instances in which breach of the duty of confidentiality may be justified?
Is disclosure made after one of the three instances acceptable?
To prevent a criminal offence that will result in serious bodily harm
Where the client has indicated they intend to commit suicide or serious self-harm
To protect a child or vulnerable adult
No, disclosure must take place before the fact as the point is the prevention of harm
126
For how long does the duty of confidentiality last?
Forever. It continues beyond the end of the retainer and the death of the client.
Therefore, client always includes former client
127
What are four instances in which disclosure to the client is not required?
Client gives informed consent, in writing to non-disclosure
You believe disclosure would cause serious injury to a person
Legal restrictions are imposed due to national security or prevention of a crime e.g. tipping off
You are only aware of the information because it is contained in privileged documents disclosed to you by mistake
128
What three events must a solicitor notify the SRA of?
Subject to any criminal charge, conviction, or caution
Insolvency event
Aware of material changes to information about you or your practice provided to the SRA
129
What five events must a firm notify the SRA of?
Indications of serious financial difficulty
Insolvency event
Intention or awareness that it will cease operating as a legal business
Any change to information in the register
Aware of any material changes to information about the firm, or its managers, owners, or compliance officers provided to the SRA
130
What must you do if you become aware any person or body (including yourself) has committed a serious breach?
Ensure that a prompt report is made to SRA/relevant regulator
Report any facts or matters which you reasonably believe are capable of amounting to a serious breach
131
What are six allegations that are taken seriously by the SRA?
Abuse of trust
Dishonesty
Taking unfair advantage of clients
Misuse of client money
Sexual or violent misconduct
Criminal behaviour
132
What are four factors that could aggravate conduct to a serious breach?
Deliberately or wrecklessly disregarding their obligations
Taking advantage of vulnerability
Causing harm that could have been reasonably anticipated
Pattern of repeated misconduct
133
How can you satisfy your obligation to report via a COLP or COFA?
When you make a report to a COLP or COFA, do you have to follow up?
Make the report to the COLP or SOFA on the understanding that they will provide the information to the SRA
Generally, the obligation is discharged and you are not required to check
134
What must you do if you are not satisfied the COLP or COFA agrees with your assessment of the seriousness of the breach?
Make the report directly to the SRA
135
What must you do if you make a mistake and a client suffers harm as a result?
Put matters right (as far as possible)
Provide a full explanation of what happened and the likely impact promptly
136
Why would a firm generally not act to put things right until after their insurer is notified?
Because depending on what the insurer advises, the firm may be placed into a conflict with the client
137
What is the first thing you must identify in any matter?
Who you are acting for
138
What things must you inform the client of at the outset?
How the services are regulated
How this affects protection available to the client
Which activities will be carried out by you
139
What must a client be able to make informed decisions about?
The services they need
How they matter will be handled
The options available to them
140
What information must a client receive about pricing?
The best available information about:
How the matter will be priced
Likely overall cost, both at engagement and as matter progresses
If it becomes apparent initial costs will increase, you must notify the client and do not wait until the end of the matter
141
What three things must a client be informed of in writing at the outset?
The right to complain
How and to whom complaints can be made
The right to complain to the Legal Ombudsman
142
How should complaints be handled?
Promptly, fairly, and free of charge
143
What must you ensure that publicity in relation to your practice is not?
Inaccurate and misleading
144
Is public advertising e.g. on billboards allowed?
Generally, yes
145
What can you not do?
Make unsolicited approaches to members of the public in order to advertise legal services
Advertise in a targeted or intrusive way
146
What is an exception to the rule that you may not make unsolicited approaches or advertise in a targeted way?
You may approach current and former clients to advertise legal services
147
3 Cs?
CDD, Conflict checks and client care letters.
148
Client care letter?
o The client care letter helps to achieve CCS provisions 3 on service and competence and 8 on complaints handling and client information.
o Sending a client care letter is NOT a requirement under CCS and CCF but sending a client care letter that includes a lot of the information, particularly that is set out in CCS 8, helps firms demonstrate that they have met the requirements of the SRA Codes.
149
Clients must be informed in writing at the time of engagement about?
their right to complain about your services and your charges
how a complaint can be made and to whom
any right they have to make a complaint to the Legal Ombudsman and when they can make any such complaint.
o Since clients need to be informed in writing at the time of engagement about the firm’s complaints procedure, most firms show they have complied with this by including it in their client care letters.
150
How should a client letter be written?
o CCS 8.6 is also important – it says that you must
give clients information in a way they can understand
ensure they are in a position to make informed decisions about the services they need, how their matter will be handled and the options available to them.
* So, you should be giving clients information about who will handle their case, how often you will update them etc.
151
What should also be contained in the client care letter?
CCS 8.7 is also important – you must ensure that clients receive the best possible information about how their matter will be priced and both at the time of engagement and as their matter progresses, about the likely overall cost of the matter and any costs incurred.
o Many client’s complaints arise from them not understanding how they will be charged for a matter – so this is very important.
152
Why carry out a conflict check?
o The Solicitors Regulation Authority’s (‘SRA’) Code of Conduct for Solicitors, Registered European Lawyers and Registered Foreign Lawyers (‘CCS’) and Code of Conduct for Firms (‘CCF’), known as the Codes, at paragraph 6.2 say that you do not act where there is a conflict of interest
· CCF 2.1 says that firms must have in place effective systems to identify conflicts. You will see that a conflict check is something you carry out when you take on a new client.
153
When are you authorised to act for a client?
o CCS 3.1: ‘You only act for clients on instructions from the client or from someone properly authorised to provide instructions on their behalf. If you have reason to suspect that the instructions do not represent your client’s wishes, you do not act unless you have satisfied yourself that they do. However in circumstances where you have legal authority to act notwithstanding that it is not possible to obtain or ascertain the instructions of your client, then you are subject to the overriding obligation to protect your client’s best interests.’
154
What triggers conflict of interest?
doesn’t have to be an actual conflict for either type of conflict situation; a significant risk of one arising will be sufficient to trigger these sections
155
Own interest conflict?
any situation where your duty to act in the best interests of any client in relation to a matter conflicts, or there is a significant risk that it may conflict with your own interests in relation to that or a related matter.’
156
Conflict of interest?
‘a situation where your separate duties to act in the best interests of two or more clients in relation to the same or related matters**__**conflict’
157
key elements of a conflict of interest?
- the conflict has to arise out of the ‘same or related matters’ – this is not defined but look for the same asset or liability or a reasonable degree of relationship between the assets or liabilities for the conflict to arise.
- the duties owed to your clients’ conflict – would advising one client to do what is best for it prejudice the course of action you would recommend to another? Or even completely conflict with it?
158
Objective?
- an asset; or
- a contract; or
- a business opportunity
159
conditions for SCI and CSO?
- all the clients have given informed consent, given or evidenced in writing, to you acting;
- where appropriate, you put in place effective safeguards to protect your clients’ confidential information; and
- you are satisfied it is reasonable for you to act for all the clients
160
What does a conflict check involve?
o A search should be carried out against:
The client name (and any of its parent or subsidiary companies).
The client’s company number (and that of its parent or subsidiary companies).
The names of any counter parties to the matter (for example if the new client is proposing to sell its subsidiary company X to Y, you need to check whether your firm is acting for Y on any matters).
o The firm’s conflicts checks may also extend to:
The company name and number of the company being bought, X, in the above scenario.
The names of directors of the client (including directors names of any parent company and subsidiaries) and of the company being bought to see if the new client and new matter conflicts with any previous clients or matters on which the firm has acted.
The name of the matter (which would include the name of any target company on these facts).
* Each law firm will have their own procedure for carrying out a conflict check.
161
Good reasons for terminating client's retainer?
you cannot obtain clear instructions (for example each of the two partners from a two-partner firm of accountants give you conflicting instructions);
to carry on acting for the client would break the law or breach the Codes (for example where there is a conflict of interests); or
your client has failed to pay its bills.
o A lawyer or law firm cannot terminate their retainer with a client on grounds of self-interest as paragraph 1 of CCS and CCF requires you to treat a client fairly.
162
Do law firms need a procedure for complaints?
o Every law firm must have a procedure for dealing with complaints. CCS 8 requires that you:
ensure that, as appropriate in the circumstances, you either establish and maintain, or participate in, a procedure for handling complaints in relation to the legal services you provide (CCS 8.2).
