Ethics and Professional Conduct - ALL Flashcards
What are the SRA’s seven mandatory principles?
A solicitor must 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.
Where does the principle requiring solicitors to behave in a way that upholds the constitutional principle ofthe rule of law, and the proper administration of justice come into play?
Primarily in the solicitor’s relationship with the courts i.e. in Dispute Resolution and Proceedings Before Courts, Tribunals, and Inquiries.
What type of behaviour would breach the principle that a solicitor must behave in a way that upholds public trust and confidence in the solicitors’ profession?
If a solicitor is convicted of a criminal offence (that is not minor). The solicitor could be potentially struck off. Serious offences for the purposes of this principle include: * dishonesty (e.g. theft of client money/fraudulent schemes/submitting false expense claims/dishonest election related crimes)* serious sexual offences * **GBHSanctions** depend on the facts and the degree of seriousness in each case. SRA assesses how far public trust has been undermined.
What does the principle of independance require?
Lawyers must be able to give impartial advice. Example: referring all clients to the same estate agent in return for a referral fee would be a breach/where a firm is put under the control of an unregulated third party its independance may be at risk.
What is the difference between the principles of honesty and integrity?
Honesty: don’t tell liesIntegrity: do the right, moral, ethical thing in all circumstances. The two principles can overlap. It is possible to act without integrity while still being honest. Note, an act of a solicitor in their personal life could mean that they have failed to act with honesty or integrity. Examples of breaches:* ignoring rules and being reckless to consequences* taking on new partners without vetting and subsequently discovering they had committed fraud in conveyancing transactions * taking advantage of someone without legal knowledge* backdating documents* misleading the courts.
Is the requirement for a solicitor to act in a way that encourages equality, diversity, and inclusion limited to compliance with the Equality Act?
No, the duty is broader.
What does the principle to act in the best interests of each client require?
- Avoid conflicts of interests* Keep client information confidential * Disclose important information to the client* Deliver competent and timely service
Which principle prevails when two or more principles conflict?
The principle which safeguards the wider public interest outweighs the individual client’s interests. Where relevant, the solicitor should inform their client of the circumstances in which their duty to the court and other professional obligations take precedence over their duty to the client.
What are the 3 rules regarding discrimination in the context of the provision of legal services?
- You must not unfairly discriminate by allowing your personal views to affect your professional relationships and the way in which you provide your services2. Firms are required to monitor, report, and publish workforce diversity data, as prescribed by the SRA.3. You have a legal obligation to provide reasonable adjustments to ensure that disabled clients and employees are not placed at a substantial disadvantage compared to those who are not disabled, and you must not pass on the costs of these adjustments to others.
Is discrimination permitted if requested by a client?
No.Example: if a client asked you to not instruct a certain chambers because they are all women, this would not be permitted.
Is the duty to provide reasonable adjustments to disabled clients and employees absolute?
No.Adjustments only have to be ‘reasonable’, so the firm does not have to accommodate the needs of disabled clients and employees in all cases e.g. if it is cost prohibitive Examples of reasonable adjustments:* Ensuring that clients can access the firm’s premises easily* Providing sign language services* Providing specialist equipment for employees.
How might a solicitor abuse their position?
By taking unfair advantage of clients or others. Examples of abuse of the solicitor’s fiduciary position:* offering to sell a client an expensive car when you know they have come into money * throwing weight around to gain an advantage or get out of something * “I’m a solicitor”* taking advantage of an unrepresented client * oppressive/domineering tactics
How can a solicitor mislead others?
- affirmative acts* omissions (e.g. failing to inform someone that their understanding/view is incorrect)* being complicit in the acts or omissions of others (including your client)
What is the scope of the duty not to mislead?
You must not mislead or attempt to mislead your client, the court, or others. * Examples: Attempting to cover tracks by forging/backdating documents, saying you haven’t heard back when you haven’t started working on something.A solicitor must take particular care not to mislead an unrepresented counterparty e.g. telling them terms are standard and you would accept them if you were them if they are not actually in that party’s best interests.
What is an undertaking?
An undertaking is:* A statement (given orally or in writing), whether or not it includes the word ‘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.
When must an undertaking be performed?
- Within the agreed timescale. * If there is no agreed timescale, within a reasonable amount of time.
Who can give an undertaking?
Anyone in the firm, including support staff.
Who is bound by an undertaking?
The individual giving the undertaking and their firm.
Does a solicitor or firm have to give an undertaking?
No but if they do, they must perform it.
If an undertaking relates to the payment of fees, is it valid if the person giving the undertaking does not have the funds?
No, this is not a prerequisite for the undertaking and does not affect the validity of the undertaking, which will still be binding even if the solicitor is not in funds.To protect the solicitor giving the undertaking, they should ensure fees are cleared in the client account at the time of giving the undertaking.
What are the 6 elements of best practice in giving an undertaking?
- Given by a solicitor (should be a clear policy about who can give undertakings given to the other side to ensure reasonable reliance cannot be placed on undertakings accidentally given)2. In writing (reduces chance of mishearing and is proof of what was actually said)3. Clearly intended to be an undertaking (i.e. ‘I undertake…);4. Given only with the client’s express authority5. Recorded on the file and on a register of undertakings in the firm (if anyone else deals with it in the future, they know the firm is bound)6. Clear in its terms (an ambiguous undertaking will be construed against the party that gave it
What 9 steps should a firm or regulated person take when giving an undertaking?
- Have a clear policy on who can give undertakings 2. Prescribe the manner in which undertakings may be given3. Where possible, prepare standard undertakings, with clear instructions that any departure be authorised in accordance with supervision and management responsibilities4. Operate a system whereby terms are checked by another fee earner5. Ensure all staff understand that they need the client’s agreement before giving an undertaking6. Ensure all staff understand the undertakings they give when exchanging contracts on the sale or purchase of land and the undertakings required to complete such transactions 7. Have a clear policy on how compliance will be monitored and maintain a central record to ensure and monitor compliance (i.e. when given and when discharged)8. Copy each undertaking and attach it to the relevant file; label the file itself9. Confirm oral undertakings (given or received) in writing
What are the 3 elements of bad practice in giving an undertaking?
- Given by any member of staff in a legal firm2. Given orally (typically on the telephone)3. Given inadvertently (i.e. without using the word ‘undertaking’).
What are 4 types of dangerous undertakings?
- To give money that has not yet been received (and may never be received, making the firm liable)2. To forward a document not yet in your possession3. To clear a client’s debt to someone (open ended and potentially extrememly costly)4. To do something the client has not yet agreed to.
What should you do if an undertaking is dependant on a future event and it becomes apparent the event will not occur?
Notify the recipient of this.
How can you avoid accidentally making an undertaking?
Use the words “I will use my best endeavours…” rather than “I will…” or “I promise…”.
What are the 4 potential consequences of breaching an undertaking?
- Solicitor is personally bound to comply with an undertaking 2. Undertaking can be **enforced by the court. **3. Recipient of undertaking may seek compensation for any loss incurred.4. Solicitor may be disciplined for breach of professional conduct obligations and sanctioned by the SRA and SDT. Possible santions from LeO also for poor service.
Can the SRA, LeO and SDT enforce undertakings?
No but they may sanction the solicitor if they fail to fulfil an undertaking.
If a member of support staff tells someone they will do something over the phone and the other person relies on this, is this an undertaking?
Yes and the firm will be liable for any breach of this undertaking.
What are SMART undertakings?
- Specific (who will do what and by when?)* Measurable* Agreed* Realistic* Timed
“Specific” undertakings
Bad: * “I will send you the deed of easement”* “We undertake to pay your legal fees of £1,000 plus VAT in relation to [insert client and matter].The legal fees promised will be payable in any event.Good:* “I undertake to send you by first class post the deed of easement dated 1 January 2023 made between Party A and Party B. I will send the deed today.* We undertake to pay your legal fees of £1,000 plus VAT in relation to [insert client and matter] within 3 working days of completion of the matter.The legal fees will only be payable if the matter actually completes.
“Measurable” undertakings
Bad* “We will redeem the mortgage in favour of Barclays Bank plc out of the proceeds of sale”. (This could be very dangerous if there is more than one mortgage in favour of Barclays Bank plc, as this undertaking could be construed as agreeing to pay them all off).* “We undertake to pay your legal fees in relation to insert matter and clients]”. (This is an open-ended undertaking and the firm giving the promise will be liable to pay the other side, whatever the level of fees incurred). Good* “In consideration of your today completing the purchase of [insert property address] we hereby undertake forthwith to pay over to the [insert details of lender] the money required to redeem the mortgage/legal charge dated [insert date] and to forward the receipted mortgage/legal charge for evidence of discharge to you as soon as it is received by us from the [insert lender]. * “We undertake to pay your legal fees limited to a maximum of £1,000 plus VAT (and £20 for disbursements) in relation to insert matter and clients]”.
“Agreed” undertakings
Bad: Stating during a telephone call that your firm will do something and failing to follow that up in writing. Good: The wording of the undertaking is agreed in advance between the solicitors in writing.
“Realistic” undertakings
Bad: * “I will send you the contract signed by my client”. (Issues fulfilling this if at the time of making the statement, the solicitor does not yet have the signed contract). * If you can’t comply with the undertaking, it can still be enforceable. Good: * “I undertake to send you by first class post the contract signed by my client within 7 days of receipt of the signed contract from my client”. * If the solicitor never receives the signed contract, they cannot be in breach. * The solicitor will be under a duty to inform the recipient of the undertaking as soon as possible that he cannot comply with the undertaking.
What are the 2 rules regarding evidence and witnesses?
- You must not misuse or tamper with evidence, or attempt to do so. You also must not seek to influence the substance of evidence (e.g. generate false evidence by inventing facts or creating documents/persuade witnesses to change their evidence).* You must not provide or offer to provide any benefit to a witness if the benefit is dependent upon the nature of the evidence or the outcome of the case.
Can a witness be paid in any circumstances?
Permitted payments are:* legitimate travel expenses* earnings they would lose by not attending work.
What are the 3 elements of respecting the court?
- You must not waste the court’s time (all assertions representations, or statements you make to the court or others must be properly arguable i.e. not baseless claims).2. You must comply with all court orders and not place yourself in contempt of court (and advise your client to do the same and of the consequences of non-compliance)3. You must draw the court’s attention to relevant cases and statutory provisions, and any procedural irregularities of which you are aware, and which are likely to have a material effect on the outcome of the proceedings even if it harms your client’s position.
What can you do if you are required to draw the court’s attention to relevant law?
Seek to distinguish the case but you must never ignore it.
If a client accused of a criminal offence admits guilt to you, what must you do?
- You must not assert that the client is not guilty and must not allow the client to give evidence that they are not guilty.* You may seek to show that the prosecution have not produced sufficient evidence to convict.* If the client wants to plead not guilty, you can try to persuade them not to but if they insist or try to give false evidence, you must withdraw and tell the court you can no longer act for professional reasons - you do not breach the client’s confidence by telling the court they are lying.
If a client has or attempts to give false evidence, what must you do?
- You must persuade the client to correct any false evidence already given or not to give the false evidence. * If the client refuses, you must withdraw and tell the court you can no longer act for professional reasons - you do not breach the client’s confidence by telling the court they are lying.
What are the 4 key elements of service and competence?
- Authority to act for the client2. Competence and timely service3. Customising service to each client 4. Management Responsibilities (Supervision and Training & Guidance)
In what 3 circumstances can you act for a client?
- On instructions from the client* On instructions from someone properly authorised to provide instructions on the client’s behalf e.g. under a POA* Where the client’s instructions cannot be ascertained, you have legal authority to act despite this fact and your overriding obligation is to protect your client’s best interests.
What must a solicitor do if someone else is authorised to give instructions on behalf of their client by a Power of Attorney?
Check the terms of the original document appointing the attorney. Someone with Power of Attorney is able to sign legal documents on behalf of the client (client may not have mental authority).
Can a client give someone else authority to instruct a solicitor on their behalf in a letter?
Yes but the solicitor must exercise extreme caution if this is the case. The client must have mental capacity to give this authority and will still be required to sign any legal documents.
What must a solicitor do if they suspect that an authorised person’s instructions do not represent their client’s wishes?
The solicitor must not act unless they are satisfied the instructions represent the client’s wishes and have a duty to investigate to confirm the client’s wishes before acting.Example: a child of an elderly parent giving instructions and the solicitor suspects the child is acting for their own benefit.
Can a solicitor take instructions from one person on the sale of a property that is jointly owned by two people?
Yes, a solicitor can agree with all clients to take instructions from one main party as the matter progresses provided they are sure at the outset of the matter and before the retainer is created that the co-owner wants to sell the house and wants to instruct the firm.
What 3 steps should a solicitor take when taking instructions to draft a will?
- Interview the client alone, without the child if possible2. Any instructions must take account of the client’s vulnerability (mental or otherwise)3. Advise the client appropriately given the circumstances e.g. if there is another child the client is fond of ensure the client understands could leave property to that chid too.
What are the 4 requirements of competent service?
- You must maintain your competence to carry out your role and keep your professional knowledge and skills up to date.* Competence is a higher threshold than “not negligent”* If you have no experience in the area, you shouldn’t take the matter on (note, you can if you put the time in but you cannot charge the client for the time to make yourself competent)* Junior solicitors must be supervised appropriately to ensure the service is competent.
What does timely service require?
The solicitor must have the time to do the job, if they are very busy and will not have time to take on a new job for a client, the solicitor must decline to take on the new retainer.
What are the potential consequences of failing to provide competent and timely service?
Failure can give rise to:* disciplinary action (breach of duty to act in client’s best interests) * negligence claim
What must be considered in customising service to each client?
The solicitor must consider and take account of each client’s attributes, needs, and circumstances.Look out for:* depth of knowledge* any special circumstancesExample:* If a solicitor knows their client is illiterate, updates should be provided by telephone in addition to email or post.* A first time buyer may need more information on the legal process as compared to a sophisticated commercial client.
What is the role of a manager/supervisor in the context of competence of service?
In acting as a supervisor or manager to others providing legal services, you must:* remain accountable for the work carried out through them and effectively supervise work being done for clients.* ensure that the individuals you manage are competent to carry out their role and that they keep their professional knowledge and skills, as well as their understanding of their legal, ethical, and regulatory obligations, up to date.
What is the role of a firm in the context of competence of service?
Firm must: * have an effective system in place for supervising clients’ matters.* ensure that the managers and employees of the firm are competent to carry out their role and that they keep their professional knowledge and skills, as well as their understanding of their legal, ethical, and regulatory obligations, up to date.
What are the 3 professional conduct rules regarding client money and assets?
- Firms/Solicitors must account to the client for any financial benefit they receive as a result of the client’s instructions unless the client has already agreed otherwise2. Firms/Solicitors must safeguard money and asseets entrusted to them by clients and by others e.g. title deeds to a house or other legal documents3. Solicitors must not personally hold client money (i.e. in the business account) unless it relates to the advance playment of fees and expenses and the client is informed in advance of where and how the money will be held.
What is the difference between a referral and an introduction?
Referral is when a solicitor refers a client to a third partyIntroduction is when a third party refers a client to a solicitor.Note, money is likely to change hands in both situations and the duties to act with independance and in the client’s best interest must be protected.
Who has the responsibility of informing the client of any financial or other interest (e.g. a family relationship with a third party) the solicitor has in the client’s instructions?
The solicitor.
What are the 3 rules that apply when:* a solicitor refers a client to a third party, * a third party refers a client to a solicitor, or * there is a fee sharing agreement in place?
- The client must be informed of the interest (financial or otherwise) which the solicitor or their business or employer has in referring the client to a third party, or which an introducer has in referring the client to the solicitor2. All fee sharing agreements with a third party must be in writing. Additionally, the client must be informed of any fee sharing arrangement that is relevant to their matter.3. Payments for referrals or introductions in relation to clients who are the subject of criminal proceedings are prohibited
If a client contacts you with respect to a criminal matter, you refer it to another solicitor and they send you a gift as a thank you, can you accept it?
No, this would be treated as a prohibited payment with respect to criminal proceedings.
What is a prohibited referral fee?
- The Legal Aid, Sentencing and Punishment of Offenders Act 2012 (LASPO) prohibits the payment or receipt of referral fees in claims for damages following personal injury or death e.g. paying a claims management company for the referral of a personal injury client. * This prohibition also applies to ancillary claims arising from the same circumstances (e.g. uninsured loss recovery claim resulting from the accident).* The SRA will presume a payment is a prohibited referral fee unless the solicitor demonstrates otherwise so solicitors should retain records and management information.* This standard applies to firms as well as to individual solicitors.
Is making or accepting a prohibited referral fee a criminal offence?
No, it is a regulatory breach, not criminal.
What is a “separate business” of a solicitor?
A ‘separate business’ is a business:* which you own, or are owned by, or actively participate in or control, or are otherwise connected with; and * which is not an authorised body, an authorised non-SRA firm, or an overseas practice.
What are the 2 actions in relation to “separate businesses” of a solcitor that require informed client consent?
- Referring, recommending, or introducing the client to a separate business (you cannot pass on a client’s contact information without their consent)* Dividing a client’s matter between you and a separate business, or allowing the client’s matter to be so divided.”Informed” client consent means the solicitor has told the client of their relationship with the business.This applies to firms and solicitors.
What is best practice for a solicitor when a client needs advice that the solicitor cannot give?
The solicitor should give details of more than one of these advisers (e.g. mortgage advisors/surveyors etc.) to the client and suggest that the client make direct contact with them.This solicitor must not pass on the client’s details without the client’s informed consent to any advisor.
What 3 business requirements are specific to solicitors?
- You must not be a manager, employee, member, or interest holder of a business that has a name which includes the word ‘solicitors’, or describes its work in a way that suggests it is a solicitor’s firm, unless it is an authorised body (i.e. a body that has been recognised by the SRA).2. You must complete and deliver to the SRA an **annual return in the prescribed form if you hold a practicing certificate.3. If you are carrying on any reserved legal activities in a non-commercial body (i.e. a not-for-profit body, a community interest company, or a trade union), you must ensure that the body takes out and maintains indemnity insurance with adequate and appropriate cover** in respect of all services you provide, regardless of whether they are reserved legal activities or not
What are reserved legal activities under the Legal Services Act 2007?
- The exercise of a right of audience (i.e. right to appear before and address a court, including the right to call and examine witnesses)* Conducting litigation (i.e. issuing, commencing, prosecuting, or defending proceedings before any court in England or Wales, or performing in ancillary functions in relation to these proceedings)* Preparing instruments relating to real or personal estate e.g. any instrument of transfer or charge for the purposes of the Land Registration Act 2002.* Preparing probate papers* Notarial activities (i.e., activities that were customarily carried on by notaries)* The administration of oaths.
What 5 business requirements are specific to firms?
- To have effective business systems for governance in place2. To keep and maintain records to demonstrate compliance with the SRA’s regulatory arrangements3. To remain accountable for compliance with the SRA’s regulatory arrangements even where the firm’s work is carried out through others (i.e. the managers, employees and other persons with whom the firm contracts).4. To actively monitor its financial stability and business viability. It must also identify, monitor, and manage all material risks to its business, including those which may arise from the firm’s connected practices and if it becomes aware that it will cease to operate, it must effect an orderly wind-down of activities.5. To have managers and compliance officers
What are the 4 purposes of governance structures in a firm?
To ensure:* Compliance with the terms and conditions of the firm’s authorisation* That managers, employees, and interest holders comply with all applicable SRA regulatory arrangements* That managers and interest holders, and those who the firm employs or contracts with, do not cause or substantially contribute to a breach of the SRA’s regulatory arrangements by the firm, the managers, or its employees* That compliance officers are able to discharge their duties.
What is the role of a manager in relation to the SRA’s business requirements of firms?
The manager of an SRA-authorised firm is responsible for the firm’s compliance with the Code of Conduct.If there are multiple managers, their responsibility is joint and several.
What are the 5 responsibilities of a COLP in relation to the SRA’s business requirements of firms?
The Complaince Officer for Legal Practice is to take all reasonable steps to:* Ensure compliance with the terms and conditions of the firm’s authorisation* Ensure that the firm and its managers, employees, and interest holders comply with the applicable SRA regulatory arrangements* Ensure that the firm’s managers and interest holders, and those they employ or contract with, do not cause or substantially contribute to a breach of the SRA’s regulatory arrangements* Ensure that a prompt report is made of any serious breach of the terms and conditions of the firm’s authorisation, or the SRA regulatory arrangements* Ensure that the SRA is informed promptly of any facts or matters that the COLP reasonably believes should be brought to its attention so the SRA may investigate whether a serious breach of its regulatory arrangements has occurred or otherwise exercise its regulatory powers.These requirements do not apply to matters which are the responsibility of the firm’s COFA
What are the 3 responsibilities of a COFA in relation to the SRA’s business requirements of firms?
The Complaince Officer for Finance and Administration is to take all reasonable steps to:* * Ensure that the firm and its managers and employees comply with the SRA Accounts Rules obligations* Ensure that a prompt report is made to the SRA of any serious breach of the SRA Accounts Rules* Ensure that the SRA is informed promptly of any facts or matters that the COFA reasonably believes should be brought to its attention so the SRA may investigate whether a serious breach of its regulatory arrangements has occurred or otherwise exercise its regulatory powers.
