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Legal Services > The Regulatory Role of the Solicitors Regulation Authority > Flashcards

The Regulatory Role of the Solicitors Regulation Authority Flashcards

1
Q

Which parties are within the scope of the SRA regulation?

A
  • Solicitors
  • The firms in which solicitors work ( and non-lawyers they employ)
  • Registered European and foreign lawyers
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2
Q

What is the SRA’ purpose?

A

To protect the public by ensuring that solicitors meet high standards, and by acting when risks are identified.

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3
Q

What is the composition of the SRA’s board?

A

Five solicitors and six lay members

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4
Q

How is the SRA funded?

A

By the practising certificate fee

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5
Q

How do the SRA Principles require those regulated by the SRA to act?

A
  • In a way that upholds the constitutional principle of the rule of law, and the proper administration of justice
  • In a way that upholds public trust and confidence in the solicitor’s profession and in legal services provided by authorised persons
  • With independence
  • With honesty
  • With integrity
  • In a way that encourages equality, diversity and inclusion
  • In the best interest of each client
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6
Q

What is the role of the FCA in relation to the individuals and firms it regulates?

A
  • Controls training and admission to the profession
  • Sets standards for ethical and professional behaviour
  • Framew rules for the handling of client money
  • Supervises firms
  • Takes enforcement action where appropriate
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7
Q

What is the purpose of legal services regulation?

A
  • Protect consumers of legal services; and
  • Support the operation of the rule of law and the proper administration of justice
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8
Q

What is the FCA approach to regulation?

A

A risk based approach with focus on misconduct most likely to harm the public interest

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9
Q

Provide some examples of risk in the delivery of legal services

A
  • The way the firm is structured and its viability
  • A firm or individuals becoming involved with fraud or dishonesty
  • The people, systems and internal processes of a firm
  • Individuals lacking the requisite skills, knowledge or behaviour
  • The way the legal market operates
  • Factors, such as economic, political or legal change
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10
Q

What measures the SRA can adopt to address issues or reduce risks identified?

A
  • Set standards
  • Impose fines
  • Issue warning notices
  • Raise consumer awareness
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11
Q

What are the business that are eligible business to be recognised by the SRA?

A
  • Recognised sole practice
  • Recognised bodies:
    (a) Partnerships
    (b) Limited Liability partnerships
    (c) Companies
  • Licensed bodies
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12
Q

What is a sole practitioner?

A

A solicitor who chooses to practice alone. They might employ other solicitors but they own the firm in it’s entirety.
Their firm is authorised by the SRA as a “recognised sole practice” instead of the individual being recognised as a sole practitioner.

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13
Q

What is a recognised body?

A

A legal services body in which all of the managers and interest holders are legally qualified.

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14
Q

What is a “legal serviced body”?

A

Where at least 75% of the body’s managers are legally qualified, the proportion of shares and voting rights held by legally qualified persons is at least 75% and managers who are not legally qualified are approved by the SRA. In addition, at least one manager must be a solicitor ( or registered European Lawyer)

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15
Q

What is the definition of Limited Liability Partnership?

A

It is an incorporated partnership. LLP have members who share the profits of the LLP

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16
Q

What are alternative business structures?

A

They operate in the same way as conventional law firm although they may be offering legal services alongside non-legal services.

The ownership, control or management of an ABS is not wholly in the hands of individuals who are legally qualified.

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17
Q

When is a body eligible to apply for authorisation as a licensed body?

A
  • There must be at least one manager who is authorised by the SRA or another approved regulator
  • It must be a licensable body
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18
Q

When an entity is a licensable body?

A

A body “B” will be a “licensable body” if a non-authorised person:
- is a manager of B
- is an interest holder of B (hold shares or is entitled to exercise any voting rights)

Alternatively, if:
- Another body “A” is a manager of B, or is an interest holder of B, and
- non-authorised persons are entitled to exercise, or control the exercise of, at least 10% of the voting rights in A

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19
Q

What is the scope of business that a recognised body and a licensed body are authorised to do?

A

Recognised body:
- Professional services of sort provided by individuals practising as solicitors and/or lawyers of other jurisdictions;
- Other professional services set out in annex 2 of the Rules, for example alternative dispute resolution, estate agency and financial services.

Licensed body:
Same range of activities as a recognised body in accordance with the terms of the license granted by the SRA

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20
Q

What are the two roles that recognised bodies and licensed bodies need to have at all times in their firms?

A

Compliance Officer for Legal Practice (COLP) and Compliance Officer for Finance and Administration (COFA)

21
Q

What are the intended key outcomes of the SRA authorisation process?

A
  • Clients and the general public remain confident that legal services provided by regulated firms will be delivered to the required standard
  • Firms will be managed in such a way, and with appropriate systems and controls in place to promote public confidence in legal services
  • Those who own and manage law firms have the competence, character and willingness to achieve the right outcomes for clients and third parties
  • Only those individuals and firms who/that meet the SRA’s criteria for authorisation or approval (including the requirements to be suitable and capable of providing legal services to the required standard) are authorised or approved.
22
Q

What are the potential outcomes of an application to be authorised by the SRA?

A
  • Blanket authorisation
  • Authorisation to provide selected legal services
  • Refusal of the application
23
Q

What are the requirements that must be satisfied for a person to act as a solicitor?

A
  • Admission as a solicitor
  • His name is on the roll
  • Has in force a certificate issued by the Society authorising him to practise as a solicitor
24
Q

When will an individual be admitted to the roll of solicitors?

A

When they have attained the required qualifications, training and the SRA is satisfied as to their character and suitability to be a solicitor

25
Q

What are the categories of criminal conduct that are considered by the SRA when someone is applying for admission as solcitor?

A
  • Most serious:
    A finding in this category will likely result in refusal of the application
    Includes situations where the application has been convicted by a court of criminal offence resulting in a custodial or suspended sentence, involving dishonesty, perjury, fraud and/or bribery, of a violent or sexual nature, associated with obstructing the course of justice, associated with terrorism or which demonstrated behaviour showing signs of discrimination towards others. Also includes cases where a caution has been accepted from the police for an offence involving dishonesty, violence or discrimination or a sexual offence or the applicant has been included on the violent and sex offender register
  • Serious
    A finding in this category may result in the application being refused. These include where a caution or offence not falling within the “most serious” category and where an individual is subject to a conditional discharge or binding order by a court
26
Q

What are the non-criminal types of conduct and behaviour that the SRA will take into account when assessing an application made by a solicitor?

A
  • Behaviours which are dishonest, violent, threatening or harassing or where there is evidence of discrimination towards others;
  • The applicant has committed of has been adjudged by an education establish to have committed a deliberate assessment offence, which amounts to plagiarism or cheating in order to gain advantage for himself or others
  • There is evidence that the applicant has deliberately sought to avoid responsibility for their debts, dishonestly managed their finances, been declared bankrupt or cannot satisfactorily manage their finances
  • The applicant has been made the subject of serious disciplinary or regulatory findings or sanctions
27
Q

When is an admitted solicitor eligible to apply to the SRA for a practising certificate?

A
  • If their name is on the roll,
  • They have sufficient knowledge of written and spoken English or Welsh
  • They are not suspended from practice as a solicitor
28
Q

What activities does the practising certificate entitles solicitors to do?

A

All reserved legal activities (except notarial activities). In relation to rights of audience, a solicitor cannot exercise those rights in the higher courts (Crown Court, High Court, Court of Appeal and Supreme Court) until they have successfully completed, as appropriate, the Higher Courts (Civil Advocacy) Qualification or the Higher Courts (Criminal Advocacy) Qualification

29
Q

Does the practising certificate authorises solicitors to provide reserved legal activities as a natural person?

A

No, subject to limited exceptions, the reserved legal activities must be provided through an authorised body.

If the solicitor wants to provide pro bono services with no connection with an authorised body, they must satisfy the requirements of an exception

30
Q

When are the practising certificates due to renewal?

A

31 October each year

31
Q

Is the SRA obliged to issue a practising if the solicitor meets the conditions?

A

No, the SRA has some level of discretion. If the SRA considers to be in the public to do so, it must refuse an application, or, at any time, it may impose conditions on an existing certificate as it sees fit.

32
Q

What are the situations in which the SRA may impose conditions on an existing practising certificate?-

A

If the SRA is satisfied that the solicitor:
- Is unsuitable to undertake certain activities or engage in certain business or practising arrangements
- Is putting, or is likely to put, at risk the interest of clients, third parties or the public
- Will not comply with, or requires monitoring of compliance with, the SRA regulatory arrangements; or
- Should take specified steps conducive to the regulatory objectives

33
Q

What are the options if the SRA refuses an application for a practising certificate or to impose conditions on one?

A

The individual can apply for a review by the SRA or appeal to the High Court

34
Q

When a freelancer is not required to be authorised as a recognised solo practice?

A

If
- Their practice consists entirely of carrying on activities which are not “ reserved legal activities” (for example, family, employment or personal injury work and general legal advice)
- Any reserved legal activities are provided through an authorised body; or
- Certain requirements are met. For example, the solicitor must have practised as a solicitor for a minimum of three years since admission, be self-employed and practise in their own name, take out indemnity insurance in respect of all the services they provide, does not employ anyone in connection with those services and only holds limited categories of client money.

The freelancer must notify the SRA of their intention to practise in that capacity

35
Q

Are in-house solicitors able to deliver reserved legal activities ?

A

Only to their employer, not to the general public

36
Q

Do non-commercial organisations need to be authorised by the SRA?

A

They are general exempt from the need to authorised.

37
Q

Can solicitors employee by non-commercial organisations able to provide reserved legal activities to the public?

A

Yes because they are covered by the wider insurance that the organisation has in place

38
Q

Can a solicitor employed by a commercial unregulated organisations provide reserved legal services to the public?

A

No, just legal services

39
Q

What types of claims are covered by the professional indemnity insurance taken by solicitors?

A

Civil claims made against a solicitor for negligence in the course of their practice

40
Q

What types of costs are usually covered by the professional indemnity insurance?

A

Legal costs of defending the claim, and, if the defence is unsuccessful, and possibly the client’s legal costs as well.

41
Q

What is required by the SRA indemnity Insurance rules in terms of the professional indemnity insurance?

A

SRA authorised firms must take out and maintain professional indemnity insurance that is appropriate for its practice and meets specific requirements set out in the rules.

42
Q

What are participating insurers?

A

Insurers who are regulated by the FCA and have an agreement with the SRA to provide insurance on particular terms.

43
Q

What are the minimum figures for the sum insured under the professional indemnity insurance?

A

For recognised and licensed body the minimum sum for any one claim (exclusive of defence costs) must be at least £3 million and at least £2 million in all other cases.

44
Q

What is the procedure if a firm cannot effect a qualifying insurance at the end of the policy period?

A
  • The minimum terms and conditions will extend the cover for a maximum of 90 days.
  • The firm must inform the SRA that it has entered this extended policy period
  • After 30 days, if no cover can be found, the firm must notify the SRA and cannot take new work
  • If at the end of 90 days, insurance cover still cannot be secured, the firm must cease practising.
45
Q

Who needs to comply with the requirement to have adequate and appropriate insurance?

A
  • SRA authorised firms
  • Freelance solicitors providing reserved legal services to the public.
  • Solicitors in non-commercial organisations providing reserved legal services to the public
46
Q

Are freelance solicitors and solicitors working for non-commercial bodies subject to the restriction of excluding or limiting their liability to clients below the minimum level under the SRA’s minimum terms and conditions?

A

No.

47
Q

Is there a restriction in solicitors capping their liability above the minimum level?

A

No, but if a solicitors sets a cap it needs to have regard to a solicitor’s professional conduct obligations. For example, a solicitor must act in the client’s best interests and must not abuse their position by taking unfair advantage of clients

48
Q

What information about the professional indemnity insurance do solicitors need to make available for clients?

A
  • The firm’s compulsory layer of professional indemnity insurance, including details of the insurer and the territorial coverage of its insurance.
  • Freelance solicitors providing reserves legal services to the public must inform their clients that they are not required to meet the SRA’s minimum terms and conditions

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