Solicitors Act 1974

SCHEDULES

Section 35.

SCHEDULE 1 Intervention in Solicitor's Practice

PART I Circumstances in which Society may Intervene

1 (1) Subject to sub-paragraph (2), the powers conferred by Part II of this Schedule shall be exercisable where—

(a) the Council have reason to suspect dishonesty on the part of—

(i) a solicitor, or

(ii) an employee of a solicitor, or

(iii) the personal representatives of a deceased solicitor,

in connection with that solicitor's practice or in connection with any trust of which that solicitor is or formerly was a trustee ;

(b) the Council consider that there has been undue delay on the part of the personal representatives of a deceased solicitor who immediately before his death was practising as a sole solicitor in connection with that solicitor's practice or in connection with any controlled trust;

(c) the Council are satisfied that a solicitor has failed to comply with rules made by virtue of section 32 or 37(2)(c) ;

(d) a solicitor has been adjudged bankrupt or has made a composition or arrangement with his creditors ;

(e) a solicitor has been committed to prison in any civil or criminal proceedings;

(f) the powers conferred by section 104 (emergency powers) or 105 (appointment of receiver) of the [1959 c. 72.] Mental Health Act 1959 have been exercised in respect of a solicitor; or

(g) the name of a solicitor has been removed from or struck off the roll or a solicitor has been suspended from practice.

(2) The powers conferred by Part II of this Schedule shall only be exercisable under sub-paragraph (1)(c) if the Society has given the solicitor notice in writing that the Council are satisfied that he has failed to comply with rules specified in the notice and also (at the same or any later time) notice that the powers conferred by Part II of this Schedule are accordingly exercisable in his case.

2 On the death of a sole solicitor paragraphs 6 to 8 shall apply to the client accounts of his practice.

3 The powers conferred by Part II of this Schedule shall also be exercisable, subject to paragraphs 5(4) and 10(3), where—

(a) a complaint is made to the Society that there has been undue delay on the part of a solicitor in connection with any matter in which the solicitor or his firm was instructed on behalf of a client or with any controlled trust; and

(b) the Society by notice in writing invites the solicitor to give an explanation within a period of not less than 8 days specified in the notice ; and

(c) the solicitor fails within that period to give an explanation which the Council regard as satisfactory; and

(d) the Society gives notice of the failure to the solicitor and (at the same or any later time) notice that the powers conferred by Part II of this Schedule are accordingly exercisable.

4 (1) Where the powers conferred by Part II of this Schedule are exercisable in relation to a solicitor, they shall continue to be exercisable after his death or after his name has been removed from or struck off the roll.

(2) The references to the solicitor or his firm in paragraphs 5(1), 6(2) and (3), 8, 9(1) and (5) and 10(1) include, in any case where the solicitor has died, references to his personal representatives.

PART II Powers Exercisable on Intervention

Money

5 (1) The High Court, on the application of the Society, may order that no payment shall be made without the leave of the court by any person (whether or not named in the order) of any money held by him (in whatever manner and whether it was received before or after the making of the order) on behalf of the solicitor or his firm.

(2) No order under this paragraph shall take effect in relation to any person to whom it applies unless the Society has served a copy of the order on him (whether or not he is named in it) and, in the case of a bank, has indicated at which of its branches the Society believes that the money to which the order relates is held.

(3) A person shall not be treated as having disobeyed an order under this paragraph by making a payment of money if he satisfies the court that he exercised due diligence to ascertain whether it was money to which the order related but nevertheless failed to ascertain that the order related to it.

(4) This paragraph does not apply where the powers conferred by this Part of this Schedule are exercisable by virtue of paragraph 3.

6 (1) Without prejudice to paragraph 5, if the Council pass a resolution to the effect that any sums of money to which this paragraph applies, and the right to recover or receive them, shall vest in the Society, all such sums shall vest accordingly (whether they were received by the person holding them before or after the Council's resolution) and shall be held by the Society on trust to exercise in relation to them the powers conferred by this Part of this Schedule and subject thereto upon trust for the persons beneficially entitled to them.

(2) This paragraph applies—

(a) where the powers conferred by this paragraph are exercisable by virtue of paragraph 1, to all sums of money held by or on behalf of the solicitor or his firm in connection with his practice or with any trust of which he is or formerly was a trustee;

(b) where they are exercisable by virtue of paragraph 2, to all sums of money in any client account; and

(c) where they are exercisable by virtue of paragraph 3, to all sums of money held by or on behalf of the solicitor or his firm in connection with the trust or other matter to which the complaint relates.

(3) The Society shall serve on the solicitor or his firm and on any other person having possession of sums of money to which this paragraph applies a certified copy of the Council's resolution and a notice prohibiting the payment out of any such sums of money.

(4) Within 14 days of the service of a notice under sub-paragraph (3), the person on whom it was served, on giving not less than 48 hours' notice in writing to the Society and (if the notice gives the name of the solicitor instructed by the Society) to that solicitor, may apply to the High Court for an order directing the Society to withdraw the notice.

(5) If the court makes such an order, it shall have power also to make such other order with respect to the matter as it may think fit.

(6) If any person on whom a notice has been served under sub-paragraph (3) pays out sums of money at a time when such payment is prohibited by the notice, he shall be guilty of an offence and liable on summary conviction to a fine not exceeding £50.

7 (1) If the Society takes possession of any sum of money to which paragraph 6 applies, the Society shall pay it into a special account in the name of the Society or of a person nominated on behalf of the Society, and any such person shall hold that sum on trust to permit the Society to exercise in relation to it the powers conferred by this Part of this Schedule and subject thereto on trust for the persons beneficially entitled to it.

(2) A bank at which a special account is kept shall be under no obligation to ascertain whether it is being dealt with properly.

8 Without prejudice to paragraphs 5 to 7, if the High Court is satisfied, on an application by the Society, that there is reason to suspect that any person holds money on behalf of the solicitor or his firm, the court may require that person to give the Society information as to any such money and the accounts in which it is held.

Documents

9 (1) The Society may give notice to the solicitor or his firm requiring the production or delivery to any person appointed by the Society at a time and place to be fixed by the Society—

(a) where the powers conferred by this Part of this Schedule are exercisable by virtue of paragraph 1, of all documents in the possession of the solicitor or his firm in connection with his practice or with any controlled trust; and

(b) where they are exercisable by virtue of paragraph 3, of all documents in the possession of the solicitor or his firm in connection with the trust or other matters to which the complaint relates (whether or not they relate also to other matters).

(2) The person appointed by the Society may take possession of any such documents on behalf of the Society.

(3) Except in a case where an application has been made to the High Court under sub-paragraph (4), if any person having possession of any such documents refuses, neglects or otherwise fails to comply with a requirement under sub-paragraph (1), he shall be guilty of an offence and liable on summary conviction to a fine not exceeding £50.

(4) The High Court, on the application of the Society, may order a person required to produce or deliver documents under sub-paragraph (1) to produce or deliver them to any person appointed by the Society at such time and place as may be specified in the order, and authorise him to take possession of them on behalf of the Society.

(5) If on an application by the Society the High Court is satisfied that there is reason to suspect that documents in relation to which the powers conferred by sub-paragraph (1) are exercisable have come into the possession of some person other than the solicitor or his firm, the court may order that person to produce or deliver the documents to any person appointed by the Society at such time and place as may be specified in the order and authorise him to take possession of them on behalf of the Society.

(6) On making an order under this paragraph, or at any later time, the court, on the application of the Society, may authorise a person appointed by the Society to enter any premises (using such force as is reasonably necessary) to search for and take possession of any documents to which the order relates.

(7) The Society, on taking possession of any documents under this paragraph, shall serve upon the solicitor or personal representatives and upon any other person from whom they were received on the Society's behalf or from whose premises they were taken a notice that possession has been taken on the date specified in the notice.

(8) Subject to sub-paragraph (9) a person upon whom a notice under sub-paragraph (7) is served, on giving not less than 48 hours' notice to the Society and (if the notice gives the name of the solicitor instructed by the Society) to that solicitor, may apply to the High Court for an order directing the Society to deliver the documents to such person as the applicant may require.

(9) A notice under sub-paragraph (8) shall be given within 8 days of the service of the Society's notice under sub-paragraph (7).

(10) Without prejudice to the foregoing provisions of this Schedule, the Society may apply to the High Court for an order as to the disposal or destruction of any documents in its possession by virtue of this paragraph or paragraph 10.

(11) On an application under sub-paragraph (8) or (10), the Court may make such order as it thinks fit.

(12) Except so far as its right to do so may be restricted by an order on an application under sub-paragraph (8) or (10), the Society may take copies of or extracts from any documents in its possession by virtue of this paragraph or paragraph 10 and require any person to whom it is proposed that such documents shall be delivered, as a condition precedent to delivery, to give a reasonable undertaking to supply copies or extracts to the Society.

Mail

10 (1) The High Court, on the application of the Society, may from time to time order that for such time not exceeding 18 months as the court thinks fit postal packets (as defined by section 87(1) of the [1953 c. 36.] Post Office Act 1953) addressed to the solicitor or his firm at any place or places mentioned in the order shall be directed to the Society or any person appointed by the Society at any other address there mentioned; and the Society, or that person on its behalf, may take possession of any such packets received at that address.

(2) Where such an order is made the Society shall pay to the Post Office the like charges (if any), as would have been payable for the re-direction of the packets by virtue of any scheme made under section 28 of the [1969 c. 48.] Post Office Act 1969, if the addressee had permanently ceased to occupy the premises to which they were addressed and had applied to the Post Office to redirect them to him at the address mentioned in the order.

(3) This paragraph does not apply where the powers conferred by this Part of this Schedule are exercisable by virtue of paragraph 3.

Trusts

11 (1) If the solicitor or his personal representative is a trustee of a controlled trust, the Society may apply to the High Court for an order for the appointment of a new trustee in substitution for him.

(2) The [1925 c. 19.] Trustee Act 1925 shall have effect in relation to an appointment of a new trustee under this paragraph as it has effect in relation to an appointment under section 41 of that Act.

General

12 The powers in relation to sums of money and documents conferred by this Part of this Schedule shall be exercisable notwithstanding any lien on them or right to their possession.

13 Subject to any order for the payment of costs that may be made on an application to the court under this Schedule, any costs incurred by the Society for the purposes of this Schedule, including, without prejudice to the generality of this paragraph, the costs of any person exercising powers under this Part of this Schedule on behalf of the Society, shall be paid by the solicitor or his personal representatives and shall be recoverable from him or them as a debt owing to the Society.

14 Where an offence under this Schedule committed by a body corporate is proved to have been committed with the consent or connivance of, or to be attributable to any neglect on the part of, any director, manager, secretary or other similar officer of the body corporate or any person who was purporting to act in any such capacity, he, as well as the body corporate, shall be guilty of that offence and shall be liable to be proceeded against and punished accordingly.

15 Any application to the High Court under this Schedule may be disposed of in chambers.

16 The Society may do all things which are reasonably necessary for the purpose of facilitating the exercise of its powers under this Schedule.

Section 36.

SCHEDULE 2 The Compensation Fund

1 The fund shall be maintained and administered by the Society and shall be held by the Society on trust for the purposes provided for in section 36 and this Schedule.

2 (1) Subject to sub-paragraph (2), every solicitor—

(a) shall on each occasion on which he applies for a practising certificate pay to the Society with the fee payable in respect of that certificate under section 11a contribution (in this Schedule referred to as an " annual contribution ") of such amount as the Council may from time to time determine ; and

(b) where it appears from his application for a practising certificate that he has held or received clients' money at any time during the period specified in the application, shall also, if so required by the Society, pay to the Society, before the issue of the certificate, a further contribution (in this Schedule referred to as a " special levy ") of such amount not exceeding £50 as the Council may from time to time determine.

(2) An annual contribution and a special levy—

(a) shall not be payable in respect of the first three practising certificates to be issued to a solicitor after his admission; and

(b) shall be payable in the reduced amount mentioned in sub-paragraph (3) in respect of the next three certificates to be so issued.

(3) The reduced amount referred to in sub-paragraph (2)(b) is one-half of the amount which would otherwise be payable.

(4) All annual contributions and special levies received by the Society under this paragraph shall be paid into the fund.

3 The Society may invest in securities in which trustees are authorised by law to invest trust funds in their hands any money which forms part of the fund.

4 Subject to the provisions of section 1 of the [1946 c. 58.] Borrowing (Control and Guarantees) Act 1946 and of any order under that section for the time being in force, the Society may borrow for the purposes of the fund from any lender and may charge any investments of the fund by way of security for any such loan; but the aggregate sum owing at any one time in respect of such loans shall not exceed £100,000.

5 The Society may insure with authorised insurers for such purposes and on such terms as the Council may deem expedient in relation to the fund.

6 There shall be carried to the credit of the fund—

(a) all annual contributions and special levies paid to the Society in pursuance of paragraph 2 ;

(b) all interest, dividends and other income and accretions of capital arising from the investment of the fund or any part of it;

(c) the proceeds of any realisation of any investments of the fund;

(d) all money borrowed for the purposes of the fund ;

(e) all sums received by the Society under any insurance effected by the Society under paragraph 5 ;

(f) all sums received by the Society under section 36(4); and

(g) any other money which may belong or accrue to the fund or be received by the Society in respect of the fund.

7 All money from time to time forming part of the fund and all investments of the fund shall be applicable—

(a) for payment of any costs, charges and expenses of establishing, maintaining, administering and applying the fund;

(b) for payment of any premiums on insurances effected by the Society under paragraph 5 ;

(c) for repayment of any money borrowed by the Society for the purposes of the fund and for payment of interest on any money so borrowed;

(d) for payment of any grants which the Society may make under section 36 ;

(e) for payment of all costs, charges and expenses incurred by the Society by virtue of paragraph 1(1)(a) of Schedule 1 and of any costs or damages incurred by the Society or its employees or agents as a result of proceedings against the Society or its employees or agents for any act or omission done or made by it or them in good faith and in the execution or purported execution of the powers conferred by Part II of Schedule 1 ;

(f) for payment of any other sums properly payable out of the fund by virtue of section 36 or this Schedule.

Section 89.

SCHEDULE 3 Consequential Amendments

1 In section 3(3) of the [1913 c. 27.] Forgery Act 1913, in paragraph (e) after the words " the Commissioner for Oaths Act 1889 " insert, in place of the words inserted there by Schedule 2 to the [1974 c. 26.] Solicitors (Amendment) Act 1974, the words " or the Solicitors Act 1974 ".

2 In section 216(1) of the [1925 c. 49.] Supreme Court of Judicature (Consolidation) Act 1925, in paragraph (a) after the word "oaths " insert, in place of the words inserted there by Schedule 2 to the Solicitors (Amendment) Act 1974, the words " and by solicitors exercising the powers of commissioners for oaths by virtue of section 81 of the Solicitors Act 1974 ".

3 In section 88 (5) of the [1949 c. 87.] Patents Act 1949, for the words " section forty-seven of the Solicitors Act 1932 " substitute the words " section 22 of the Solicitors Act 1974 ".

4 In section 20(3) of the [1949 c. 101.] Justices of the Peace Act 1949—

(a) for the words " subsection (1) of section 2 of the Solicitors (Amendment) Act 1956 ", and

(b) for the words " the Solicitors Acts 1932 to 1956 ",

substitute, in place of the words substituted for those words by Schedule 2 to the Solicitors (Amendment) Act 1974, the words " the Solicitors Act 1974 ".

5 In Part III of Schedule 1 to the [1957 c. 20.] House of Commons Disqualification Act 1957 insert, in place of the entry inserted there by Schedule 2 to the Solicitors (Amendment) Act 1974, the following entry:—

• “Lay observer appointed under section 45 of the Solicitors Act 1974.”

6 In section 192(2) of the [1959 c. 22.] County Courts Act 1959 (as substituted by section 10(2) of the [1969 c. 58.] Administration of Justice Act 1969), for paragraph (c) substitute the following paragraph:—

“(c) section 69(3) of the Solicitors Act 1974”.

7 In section 1(2) of the [1961 c. 44.] Barristers (Qualification for Office) Act 1961, for the words " the Solicitors Act 1957 " substitute the words " the Solicitors Act 1974 ".

8 In section 4(2) of the [1967 c. 56.] Matrimonial Causes Act 1967, for the words " section 73(4) of the Solicitors Act 1957 " substitute the words " section 74(3) of the Solicitors Act 1974 ".

9 In section 223(1) of the [1972 c. 70.] Local Government Act 1972, for the words " the Solicitors Acts 1957 to 1965 " substitute the words " the Solicitors Act 1974 ".

10 In Schedule 2 to the [1974 c. 4.] Legal Aid Act 1974, in paragraph 4(2) for the words " subsection (4) of section 73 of the Solicitors Act 1957 " substitute the words " subsection (3) of section 74 of the Solicitors Act 1974 ".

Section 89.

SCHEDULE 4 Enactments Repealed

Chapter	Short Title	Extent of Repeal
12 & 13 Geo. 6. c. 21.	The Solicitors, Public Notaries, &c., Act 1949.	The whole Act.
5 & 6 Eliz. 2. c. 27.	The Solicitors Act 1957.	The whole Act.
1965 c. 31.	The Solicitors Act 1965.	The whole Act.
1969 c. 58.	The Administration of Justice Act 1969.	In Schedule 1, the entry relating to the Solicitors Act 1957.
1973 c. 14.	The Costs in Criminal Cases Act 1973.	In Schedule 1, paragraph 2.
1973 c. 15.	The Administration of Justice Act 1973.	Section 4.
		In Schedule 1, paragraph 9(2).
1973 c. 62.	The Powers of Criminal Courts Act 1973.	In Schedule 5, paragraph 9.
1974 c. 26.	The Solicitors (Amendment) Act 1974.	The whole Act.