Solicitors' Duties

Question 1

to whom do solicitors owe duties?

Answer 1

clients, the court, third parties and the SRA

Question 2

where are solicitors’ duties set out?

Answer 2

in StaRs

Question 3

what duties do solicitors owe to clients?

Answer 3

duty of confidentiality
duty of disclosure

Question 4

what is the duty of confidentiality?

Answer 4

• The affairs of current and former clients are to be kept confidential unless:
  o Disclosure is required or permitted by law; or
  o The client consents

Question 5

to whom is the duty of confidentiality owed?

Answer 5

current and former clients

Question 6

when would a disclosure be permitted by law?

Answer 6

 Under tax legislation & anti-money laundering and counter terrorist financing
 Court order
 Power of attorney
 In compliance with notice served by LO

Question 7

when can a solicitor disclose a client’s confidential information?

Answer 7

where the disclosure is permitted by law or the client consents

Question 8

if the client consents, what must they understand?

Answer 8

 What information is being disclosed, to whom and the purpose.

Question 9

what information is and is not protected by the duty of confidentiality?

Answer 9

• This applies to all information relevant to the matter, whatever the source
  o Conversely, information not relevant to the matter is not protected by this duty i.e. you are at the police station to advise a client who has committed ABH. You see the client steal a phone, giving a statement to the police about this would not breach your duty because it is not connected to the retainer

Question 10

when a client dies, is a duty of confidentiality still owed?

Answer 10

• If the client dies, the duty is owed to their PR

Question 10

is information disclosable if requested by the police?

Answer 10

No, the duty of confidentiality still applies unless the client is using the solicitor to perpetrate crime

A breach will amount to professional misconduct and the client can sue

Question 11

are there exceptions to the rule of confidentiality?

Answer 11

no, but there are justifications.

Question 12

re: confidentiality

what is the effect of justifications?

Answer 12

there would still be a breach, but the SRA would consider these to be justifications against regulatory action

This will only be mitigation if the disclosure is made before the event has taken place, not afterwards

In certain circumstances, the solicitor could still face civil action

The solicitor should always consider whether it is appropriate to attempt to obtain their consent in the first instance

Question 13

re: confidentiality

give examples of justifications

Answer 13

o Client has indicated their intention to commit suicide or self-harm;
o Safeguarding concerns and preventing harm to children and vulnerable adults;
o Preventing the commission of a criminal offence

Question 14

what is the effect of privileged information? What questions should be asked?

Answer 14

• Information subject to LLP is afforded greater protection and cannot be disclosed.
• When considering whether to disclose information, the first question should always be ‘is this information privileged or just confidential?’

Question 14

who can waive privilege?

Answer 14

the client only

Question 14

what are the types of privilege?

Answer 14

o Legal advice privilege; and
o Litigation privilege

Question 15

what is the duty of disclosure?

Answer 15

• The solicitor must make the client aware of all information material to the matter of which the solicitor has knowledge of, except when:
  o Disclosure is prohibited by legal restrictions (i.e. national security or prevention of crime);
  o The client gives informed consent for the information not being disclosed to them;
  o The solicitor has reason to believe disclosure will lead to serious physical or mental injury to the client or another person
  o The information is contained in a privileged document which the client only knows about by mistake

Question 16

when does the duty of disclosure not apply?

Answer 16

o Disclosure is prohibited by legal restrictions (i.e. national security or prevention of crime);
o The client gives informed consent for the information not being disclosed to them;
o The solicitor has reason to believe disclosure will lead to serious physical or mental injury to the client or another person
o The information is contained in a privileged document which the client only knows about by mistake

Question 17

to what information does the duty of disclosure apply?

Answer 17

• The duty applies to the information known by the specific solicitor, not the information held by the firm as a whole

Question 18

when might a conflict between client duties arise?

Answer 18

• i.e. you owe a duty of confidentiality to client A and a duty of disclosure to client B in relation to the same information.

Question 19

when there are competing duties to the client, what is the rule?

Answer 19

A solicitor must not act for a client where they have an adverse interest to the interests of another client for whom you hold confidential information, unless:
o The current/former client has given written informed consent to the solicitor acting for both clients and the special measures put in place to protect the information; or
o There are effective measures so that there is no real risk of disclosure of information.

Question 20

what is the difficulty of obtaining written consent from a client in relation to confidentiality?

Answer 20

One difficulty is that it is not always possible to share enough details to Client A about Client B without breaching confidentiality

Question 21

what are examples of information barriers?

Answer 21

 File system flags potential confidentiality issues
 Separate teams handle the matters (inc. non-fee earning staff)
 Separate servers and printers
 Information is encrypted/password protected
 Appropriate organisational and policy training for staff

Question 22

if there are competing client duties and the solicitor cannot act, which duty takes precedence?

Answer 22

• If the solicitor cannot act for both, typically the duty of confidentiality will take precedence over the duty of disclosure

Question 23

even if there are competing client duties, but the solicitor can act for both, in what circumstances should they still refuse to act for the second client?

Answer 23

o The solicitor could be professionally embarrassed
 Example  the solicitor cannot disclose Client A’s information to Client B. If this information came out and it would be embarrassing that the solicitor ever agreed to act in these circumstances, they should refuse to act.
o They cannot comply with the other principles i.e. P2 & P7

Question 24

when there is are competing client duties, what does this also usually give rise to?

Answer 24

a client conflict.

remember, a client conflict only arises between new and current clients (not former clients)

If there is a client conflict, the solicitor cannot act for both clients unless one of the exceptions applies

Question 25

what are the types of conflict of interest?

Answer 25

o Own conflict of interest
o Client conflict of interest

Question 25

what is a client conflict of interest called?

Answer 25

a conflict of interest

Question 26

explain own conflict of interest

give examples

Answer 26

• i.e. a situation where the solicitor’s duty to act in the best interests of the client conflicts (or there is a significant risk of conflict) with their own interest.
• The solicitor cannot act and there are no exceptions

Examples:
o Instructed to act against a company owned by a family member
o A client makes a substantial gift to the solicitor in a will they are drafting
o The client is considering bringing a claim against the firm

Question 27

when will a conflict of interest arise?

Answer 27

A COI arises when there is a conflict between your separate duties to different clients to act in their best interests

NB: a COI can only arise between current clients (or a new client), not a former client. However, if a former client sought to re-instruct a COI could arise

Question 28

what is the conflict of interest rule?

Answer 28

A solicitor cannot act for the client if there is a COI (or a significant risk of such a conflict) in a related matter or a particular part of it, unless:
o The clients have a substantially common interest; or
o They are competing for the same objective

Question 29

where there is a conflict of interest and the client agrees safeguards aren’t necessary, what should the solicitor do?

Answer 29

 If the client agrees that safeguards aren’t necessary this should be captured in writing

Question 29

if a solicitor can rely on one of the exceptions to the conflict of interest rule, what else must they satisfy?

Answer 29

o The clients have given written informed consent
o Effective safeguards have been put in place to protect confidential information, where appropriate
o It is reasonable to act for all the clients. Things to consider:

Question 30

where there is a conflict of interest and the solicitor is considering whether it is reasonable to act, what should they consider?

Answer 30

 Benefits of acting for both i.e. speed, costs
 Risk of transmission of confidential data
 Even-handedness and bargaining power i.e. if one client is an individual and the other is a large business it is unlikely to be reasonable

Question 31

when can the conflict of interest exceptions never be relied upon?

Answer 31

• NB: these exceptions cannot be relied upon to opponents in litigation
  o This applies to individual solicitors and firms. So if a solicitor in one team was acting for C, a solicitor in another team couldn’t act for D

Question 32

re: conflict of interest

explain ‘related matter’

give an example

Answer 32

• Just because there is conflict about a wider business interest does not necessarily mean there will be a COI, a COI will arise if the primary issue is the same
• Example > Pepsi and Coca Cola. If one instructs the solicitor about the transaction of IT equipment and the other about selling cars, there would be no COI. If they both sought to instruct a solicitor to tender the same contract, this would be a COI.

Question 33

re: conflict of interest

explain ‘significant risk’

Answer 33

• If there is a risk a party might change their mind or substantial negotiation is required, this would amount to significant risk

Question 34

re: conflict of interest

explain ‘substantially common interest’

give an example

Answer 34

• i.e. a situation where there is a clear common purpose and a strong consensus about how it is to be achieved
• If after the instruction, there is divergence then the solicitor can no longer act
• Example – common interest  group of people want to set up a company. All the key principles have been agreed. The solicitor can act, even if there are minor differences along the way, so long as there is a strong consensus.
• Example – no common interest  one person is looking to sell their share to the other two partners, they cannot act. One is selling, the others are buying – different interests.

Question 35

re: conflict of interest

explain ‘same objective’

give an example

Answer 35

• i.e. where the clients are competing for the same objective, and if one achieves it, it makes the objective unattainable for the others
• Objective = an asset, contract or business opportunity the business is trying to acquire or recover through liquidation (not inc. public takeover)
• Example  one firm acting for two companies bidding to take over a third company. There is a clear COI but information barriers could be put in place to protect confidential information.

Question 36

re: conflict of interest

when there is a conflict of issue on an issue, what could the solicitor do?

Answer 36

• If there is a client conflict on a specific issue and the solicitor cannot rely on an exception, a LR could be used

Question 37

re: conflict of interest

how does a limited retainer operate?

Answer 37

• The LR would exclude advice on the specific issue
• It will need to be made clear to the clients what you are advising on and the importance of issues you cannot advise on

Question 38

re: conflict of interest

when can a limited retainer be used?

give an example

Answer 38

• A LR must be in both parties best interests
• A solicitor should not act if not receiving the advice about the specific issue will prejudice them
• Usually proposed by the client, rather than suggested by the solicitor
• Example of when a LR might be appropriate  parties want the pre-agreed legal terms set out in a document without any legal advice

Question 39

re: conflict of interest - property transactions

can a solicitor act for buyer and seller?

Answer 39

o Will usually be a COI because negotiation is required and parties have different interests (i.e. one wants profit and one wants a cheaper deal)
o In rare circumstances, the solicitor might decide there is no COI, i.e. if everything is already agreed
o If there is a COI, it is extremely unlikely the solicitor could rely on an exception to act
o Might be able to rely on ‘substantially common interest’ if it was a sale within the family.

Question 40

re: conflict of interest - property transactions

can a solicitor act for joint buyers?

Answer 40

o permissible and common, but each case should still be assessed

Question 41

re: conflict of interest - property transactions

can a solicitor act for borrower and lender?

Answer 41

o Will be a COI, but if dealing with a standard mortgage (so there will be standard T&Cs that aren’t negotiated) then the ‘substantially common interest’ can be relied upon

o This is why this is common in residential property and less so in commercial property as more negotiation is required

o Nonetheless, the solicitor should always check for a COI, i.e.:
 If the terms are unfair to the borrower
 The buyer cannot comply with the terms
 Substantial negotiation would be required

Question 42

re: conflict of interest

can a solicitor accept a gift from a client in a will?

Answer 42

If a client wants to leave their solicitor a significant gift in a will they are drafting, there will likely be a COI if the client has not taken independent legal advice

“Significant”:
o It is more than 1% of the value of the estimated estate
o It will increase in value at some point
o The solicitor’s relationship with the deceased does not reasonably justify such a gift

Question 43

what is a summary of how to approach an SBAQ?

Answer 43

1. Is there an own conflict?
   a. YES  cannot act.
2. NO  is there a client conflict with a current client?
   a. YES  you can still act if the clients:
   i. Have a substantially common interest; or
   ii. Are competing for the same objective
   b. NO  you can act for the client
3. You have confirmed you can act for the client, subject to any existing duties of confidentiality to clients. Do you have a current or former client with material information to the new client’s case?
   a. YES  you cannot act, unless:
   i. The client provides written informed consent; or
   ii. There are sufficient information barriers in place.
   b. No  you can accept instructions

Question 44

what duty do solicitors owe to the court?

give examples

Answer 44

• Solicitors have a duty not to mislead the court by their own act or omission or being complicit in the actions of others. The solicitor’s duty to the court outweighs their duty to the client and the client should be informed of this

o Example  the client pleads NG. They later admit their guilt to the solicitor. If the client insists on giving evidence and committing perjury, they must decline to act. If the client does not insist on giving evidence, the solicitor can ask the prosecution to put their case to proof but cannot make any assertions.

o Example  client says in cross examination they did not steal a laptop. Later, they admit to their solicitor that they did steal the laptop. The solicitor is now aware the client has committed perjury. If the client refuses to tell the truth, the solicitor must decline to act.

Question 45

what duties do solicitors have in litigation?

Answer 45

• Solicitors must only put forward submissions etc they know are arguable
• Solicitors must comply with court orders and not waste the court’s time
• Solicitors must draw the court’s attention to relevant cases and statutory provisions, even if it goes against their case

Question 46

what are examples of misconduct in litigation?

Answer 46

o Calling a witness whose evidence they know to be untrue
o Construing facts to support a case which isn’t arguable
o Not sufficiently investigating the merits of the case
o Conducting excessive or aggressive litigation

Question 47

when can the solicitor take a witness statement?

Answer 47

• A witness statement can be taken at any point in the proceedings

Question 48

what duties do solicitors have in relation to evidence? Give examples

Answer 48

Solicitors must not misuse, influence or tamper with evidence or attempt to do so. Examples:
o Helping criminals create a false alibi
o Seeking the persuade a witness to give certain evidence
o Creating false evidence

Solicitors must not offer a benefit to a witness dependent upon the nature of their evidence or outcome of the case

Question 49

what is good practice when taking witness evidence?

Answer 49

• It is good practice to have a legal rep present to avoid any suggestion of impropriety

Question 50

who does a witness belong to?

Answer 50

there is no property in a witness

Question 51

what does it mean ‘there is no property in a witness’

Answer 51

o So if D has interviewed a witness, C can still do so too

Question 52

if a witness discloses adverse information when taking a statement, what must the solicitor do?

Answer 52

o If the witness discloses information adverse to the case, there is no obligation to include this in the witness statement but they may be asked adverse questions in cross examination

Question 53

what duty do solicitors owe to third parties generally?

Answer 53

• Solicitors have a duty not to mislead or take unfair advantage of others

Question 54

give examples of misleading/taking advantage of others

Answer 54

o Legalistic letters where no claim arises to minor or vulnerable adults
o Overbearing threats of claims
o Taking advantage of litigants in person
o Improper use of NDAs, i.e.: seeking to prevent someone from co-operating in criminal investigation or reporting misconduct

Question 55

what are the solicitor’s obligations when instructing counsel? Give an example.

Answer 55

A solicitor (and client if they are involved in the decision) cannot discriminate when choosing counsel

If the solicitor thinks the client has made a choice on a discriminatory basis they should ask the client to change their decision or cease to act

Example > male client facing allegations of sex discrimination requests a female barrister. This wouldn’t be allowed.

Question 56

what must a solicitor uphold when instructing counsel?

Answer 56

to continue to act in the client’s best interests, i.e.:
o There may be a case conference if it is in the client’s best interests
o If the solicitor is not certain of the quality of the advice, the solicitor should ask for clarification or a second opinion

Question 57

who is responsible for paying counsel’s/expert fees?

Answer 57

• The solicitor is responsible for payment of counsel’s fees, regardless of whether or not the client has paid
  o The solicitor may therefore ask the client for payment on account
  o This applies to other agents that are instructed, not just barristers

Question 58

what duties do solicitors and firms owe to the SRA?

Answer 58

• keeping up to date with the law
• cooperation i.e. with the SRA and other regulators
• notifying the SRA of certain changes
• reporting serious regulatory breaches
• A solicitor must not be an employee, member or interest holder of a business whose name includes the word ‘solicitor’ or insinuates to be a solicitor by its description of work if it is not regulated by the SRA.

Question 59

re: duties to the SRA

explain the cooperation duty

Answer 59

• Must cooperate with the SRA, other regulators, the LO etc
• Must respond promptly to the SRA and provide full and accurate explanations, documents etc to the SRA
• Any remedial action or investigation requested by the SRA is taken promptly

Question 60

re: duties to the SRA

explain the notification duty

Answer 60

The SRA must be promptly informed if the solicitor:
o Become subject to any criminal charge, conviction or caution
o Is involved in a relevant insolvency event (i.e. an IVA or bankruptcy)

The solicitor can report this directly to the SRA or COLP / COFA

Question 61

re: duties to the SRA

explain the reporting duty

Answer 61

• Solicitors must report promptly to the SRA or another approved regulator matters they believe are a serious breach of regulatory arrangements

Question 62

re: duties to the SRA

if the solicitor thinks there has been a regulatory breach, who can they report this to?

Answer 62

the SRA or the COLP/COFA

The COLP/COFA can then investigate, but if the solicitor knows there has been a breach they should report to the SRA immediately

Solicitors must not prevent anyone from providing information to the SRA or other relevant body (i.e. regulator, investigator or prosecutor)

Question 63

re: duties to the SRA

does a solicitor need evidence to report a regulatory breach?

Answer 63

o There need not be evidence, just a reasonable belief

Question 64

re: duties to the SRA

what factors affect the seriousness of a regulatory breach?

Answer 64

 Nature of the allegation i.e. violent, sexual, dishonest
 Intention, motivation, repeated behaviour
 Harm and impact
 Vulnerability of victim

Question 65

who is responsible for compliance with StaRs and how are they liable?

Answer 65

• Managers are responsible for compliance with StaRs and they are jointly and severally liable with other managers