Introduction to Professional Practice - Professional Conduct and Regulation
Institution
University Of Law (ULaw)
Book
Legal Foundations 2019/2020
This documents covers both workshops. Workshop 2 is covered at the start of the document e.g. FSMA.
These notes have been written in a style which provides an in-depth understanding of the module and have been created to be used in exams.
There are questions and answers and plenty of different ...
Introduction to Professional Practice - Professional Conduct and Regulation
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Professional Conduct
Number of bodies involved in the regulation of solicitors;
Solicitors Regulation Authority
- Regulate solicitors, the firms in which they operate and all those working
with those firms.
- Responsible for devising rules governing conduct;
- The handling of money; and
- The ability to practice.
- SRA also enforced its own rules and has the power e.g. to investigate
firms, impose conditions and rebuke solicitors.
Solicitor’s Disciplinary Tribunal
- Deals with applications, usually from SRA – relating to professional
misconduct by individual solicitors.
- Tribunal has the power to strike a solicitor off the roll;
- Suspend a solicitor; and
- Impose unlimited fines.
The Legal Ombudsman
- Deals with complaints from members of the public in relation to the
provision of legal services.
- In addition to the own rules of professional conduct, solicitors are also
subject to the general law.
- Most important for solicitors – Financial Services and Markets Act 2000 &
the Proceeds of Crime Act 2002 – enforced by the Courts.
- Breach of their provisions is usually a criminal matter which can result in a
solicitor being subject to a number of sanctions, including imprisonment.
SRA Regulatory Role
- Admission requirements
- Individual must meet the requirements of SRA Assessment of character
& suitability rules.
Formulated set of rules
- Account Rules
Codes of Conduct
- The code of conduct for solicitors
- The code of conduct for firms.
Seven Principles
Set out fundamental aspects of ethical behaviour that those regulated by the
SRA are expected to withhold.
- Principle 1 – requires us to uphold the rule of law and the
administration of justice. Links to P6, BOTH require compliance with
the law. Solicitors must not accept clients, if they did, would breach the
law. Also affects how solicitors deal with 3 rd parties & the Courts.
- Principle 2 – uphold public confidence in the profession and legal
services. SRA keen to maintain high standard within profession and to
protect its reputation. Applies to sol’s private life.
- Principle 3 – Independence – extends beyond giving advice which is
independent to the sol’s own independence and the firm’s independence.
- Principle 4 – Honesty – Reflects sol’s position of trust. Sol convicted of
an offence of dishonesty, likely to be struck off.
, - Principle 5 – Integrity – Sol must always behave in a manner which
accords with his position of trust.
- Principle 6 - Equality, diversity and inclusion – focuses compliance
with laws on anti-discrimination. Solicitor must not refuse if to do so would
be discriminatory, but it extends beyond mere compliance – sol must
encourage diversity and inclusion.
- Principle 7 – Client’s best interest – derives from common law as a
solicitor in a fiduciary position. Sol must do what is in the client’s best
interest., even if it means butting the client’s interest above their own.
Encompassed the responsibility of providing the client with a proper
standard of service, e.g. taking on a case in an area law which the sol has
no expertise or which the sol has insufficient time to deal with properly
would not be acting in the best interest of the client.
Codes of Conduct – Firms and Solicitors
Describe the standards of professionalism expected of those who are authorised
by the SRA to provide legal services.
Codes are a framework of competent and ethical practice.
A breach of the Codes may result in SRA taking action against an individual
and/or the firm.
Client Care and Complaints
Client must be:
- Paragraph 8.6 of the Code for Solicitors - Able to make informed decisions
about the services they need, how their matter will be handles and the
options available to them.
- Paragraph 8.7 of the Code for Solicitors – which is also applicable to firms -
Told about how their matter will be priced at the time of engagement and
when appropriate, as the matter progresses about the likely overall cost.
- Paragraph 8.3 of the Code for Solicitors - Solicitors must inform clients in
writing of their right to complain to the firm about the service they receive
and the costs and any right they have to complain to the Legal
Ombudsman, both at the time of engagement and at the conclusion of the
firm’s complaint procedure.
- Paragraph 8.5 of the Code for Solicitors – also applicable to firms –
complaint is dealt with promptly, fairly and free of charge.
- Paragraph 6.3 of the Code for Solicitors – Confidentiality – must keep the
affairs of your client confidential unless disclosure is required or permitted
by law or the clients consent.
- Paragraph 6.4 of the Code for Solicitors – disclose all relevant information
which the solicitor personally knows. Individually, the duty of
confidentiality and duty of disclosure are straightforward.
Scenario 1
Client X tells you something which you realize is helpful to client Y's case. You
owe a duty to client X to keep that information confidential, but you also owe a
duty to client Y to disclose the information to them.
Solicitor could not continue to act for both clients. Conflicting duties place
solicitor in an impossible situation. Depending upon circumstances – may still be
possible for each client to be represented by different solicitors within the same
firm.
, Scenario 2
Paragraph 6.2 & 6.3 - Conflict of interest.
Conflict of interest can arise in two situations –
- An own interest conflict occurs when the interests of the client conflict
with the interests of the solicitor – absolute bar on the solicitor acting in
this case.
- A client conflict occurs when the interest of two existing clients conflict in
the same matter. The conflict means that you cannot comply with
principle 7 by acting in the best interest of both clients.
In acting to the benefit of one client, you will be acting to the detriment of
the other.
- Usually solicitor cannot act for both clients because it is not possible to act
in the best interest of each client.
- Example
o Family solicitor is approached by a couple who want to get divorced.
They both want the divorce to be amicable and have already agreed
issues, such as the division of their assets and the arrangements for
the children. There may be no actual conflict between them at this
stage – potential for conflict arising in the future.
o With the benefit of legal advice, one party may feel that the
agreement over the division of the assets is a bad deal & so want to
argue for a great share. The risk of a conflict arising would
prevent the solicitor acting for both.
- Solicitors are not only bound by SRA, also subject to the general law.
Whilst a breach of the codes of conduct may lead to a disciplinary action
being taken against a solicitor and could result in the solicitor being struck
off. A breach of law could result in imprisonment as well as disciplinary
action.
Financial Services and the Markets Act 2000 (FSMA)
Protect the public by ensuring that these types of services are only provided to
people who have the required specialist knowledge to provide them and are duly
authorised by the FCA to do so.
Solicitor’s do not generally provide financial advice, those that do, they need to
have right expertise and be authorised.
Example
Solicitor may be advising the client on the acquisition of a business. Part of the
solicitor's duties will be to carry out due diligence, looking into the background of
the business, its financial situation and so on. There is a fine line between
advising the client on the issues that the due diligence has revealed and advising
the client on whether or not the business is the right investment.
Scenario – Solicitor acting for the executors in the administration of an
estate.
Some of the assets in the estate will have to be sold in order to pay the tax due.
Fine line between advising executors on tax liability and the options for meeting
it, and advising on the financial merits of selling or retaining particular assets.
Principles and Codes reiterate importance of financial services.
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