SCHEDULE 2F1Legal services practices: Supplementary Provisions
Interpretation
1
(1)
(2)
References in this Schedule to a recognised body F2or a recognised sole solicitor’s practice in relation to—
(a)
a complaint (other than such a complaint as is mentioned in paragraph 16(1)(a)); F5. . .
(b)
F5. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F8(2A)
References in this Schedule to a manager or employee of a recognised body, F9or to an employee in a recognised sole solicitor’s practice, in relation to a complaint (other than such a complaint as is mentioned in paragraph 16(1A)(a)), include references to a person who was such a manager or employee at the time when the conduct to which the complaint relates took place.
F10(2B)
In this Schedule references to employment in a recognised sole solicitor’s practice have the same meaning as in section 9.
(3)
F11. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(4)
In section 87(1) of the 1974 Act the definitions of “client”, “contentious business” and “non-contentious business” shall apply F12for the purposes of this Schedule; and for the purposes of—
(a)
F13any provision of this Schedule in so far as it has effect in relation to a recognised body ; and
(b)
any provision of the 1974 Act in so far as it has effect in relation to a recognised body by virtue of this Schedule,
(5)
Subject to sub-paragraphs F16sub-paragraphs (4) and (6), any expression used in this Schedule which is also used in the 1974 Act has the same meaning as in that Act.
F17(6)
In this Schedule—
“manager”, in relation to a body, has the same meaning as in the Legal Services Act 2007 (see section 207 of that Act);
“registered European lawyer” has the same meaning as in section 9A;
“the 1974 Act” means the Solicitors Act 1974.
F18 Appeal against refusal of Society to grant recognition etc
F192
(1)
A body may appeal to the High Court against—
(a)
a decision to refuse an application by the body for recognition under section 9;
(b)
a decision to impose a condition under subsection (2F) of that section on the body's recognition under that section;
(c)
a decision to impose a condition under subsection (2G) of that section on the body's recognition under that section.
F20(1A)
A sole solicitor may appeal to the High Court against—
(a)
a decision to refuse an application for recognition of the solicitor’s practice under section 9;
(b)
a decision to impose a condition under subsection (2F) of that section on the recognition of the solicitor’s practice under that section; and
(c)
a decision to impose a condition under subsection (2G) of that section on the recognition of the solicitor’s practice under that section.
(2)
A recognised body whose recognition is subject to a condition within section 9(2H)(b) may appeal to the High Court against any decision by the Society to refuse to approve the taking of any step for the purposes of that condition.
F21(2A)
Where the recognition of a recognised sole solicitor’s practice is subject to a condition within section 9(2H)(b), the sole solicitor may appeal to the High Court against any decision by the Society to refuse to approve the taking of any step for the purposes of that condition.
(3)
Rules made by the Society may make provision, as respects any application for recognition that is neither granted nor refused by the Society within such period as may be specified in the rules, for enabling an appeal to be brought under this paragraph in relation to the application as if it had been refused by the Society.
(4)
On an appeal under sub-paragraph (1)(a) or (b) F22or (1A)(a) or (b) , the High Court may—
(a)
affirm the decision of the Society,
(b)
direct the Society to grant the body F23or sole solicitor’s practice recognition under section 9 free from conditions or subject to such conditions as the High Court may think fit,
(c)
direct the Society not to recognise the body F23or sole solicitor’s practice ,
(d)
if the Society has recognised the body F23or sole solicitor’s practice , by order suspend the recognition, or
(e)
make such other order as the High Court thinks fit.
(5)
On an appeal under sub-paragraph (1)(c) F24or (1A)(c) , the High Court may—
(a)
affirm the decision of the Society,
(b)
direct that the F25... recognition under section 9 is to have effect subject to such conditions as the High Court may think fit,
(c)
by order revoke the direction given by the Society under section 9(2G), or
(d)
make such other order as the High Court thinks fit.
(6)
On an appeal under sub-paragraph (2) F26or (2A) , the High Court may—
(a)
affirm the decision of the Society,
(b)
direct the Society to approve the taking of one or more steps for the purposes of a condition within section 9(2H)(b), or
(c)
make such other order as the High Court thinks fit.
(7)
In relation to an appeal under this paragraph, the High Court may make such order as it thinks fit as to payment of costs.
(8)
The decision of the High Court on an appeal under this paragraph is final.
Accounts rules
F273
(1)
This paragraph applies where rules made under section 32(1) of the 1974 Act are applied—
(a)
to recognised bodies in accordance with section 9(2)(f) of this Act, or
(b)
to managers or employees of such bodies in accordance with section 9(2)(fb) of this Act.
(2)
The Society may disclose a report on or information about the accounts of a recognised body, or a manager or employee of a recognised body, obtained in pursuance of such rules for use—
(a)
in investigating the possible commission of an offence by the body or any of its managers or employees, and
(b)
in connection with any prosecution of the body or any of its managers or employees consequent on the investigation.
Interest on clients’ money
4
(1)
Where rules made under section 32 of the 1974 Act and containing any such provision as is referred to in F28section 33(1) of that Act are applied to recognised bodies in accordance with section 9(2)(f) of this Act, then, except as provided by the rules F29, a recognised body is not liable to account to any client, other person or trust for interest received by the recognised body on money held at a bank or building society in an account which is for money received or held for, or on account of—
(a)
clients of the recognised body, other persons or trusts, generally, or
(b)
that client, person or trust separately.
(2)
F30. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F314ZA
Where rules made under section 32 of the 1974 Act and containing any such provision as is referred to in section 33(1) of that Act are applied to managers or employees of recognised bodies in accordance with section 9(2)(fb), then, except as provided by the rules, a manager or employee to whom the rules are applied is not liable to account to any client, other person or trust for interest received by the manager or employee on money held at a bank or building society in an account which is for money received or held for, or on account of—
(a)
clients of the recognised body, other persons or trusts, generally, or
(b)
that client, person or trust, separately.
F32 Inspection of bank accounts
F334A
(1)
This paragraph applies where rules made under section 33A(1) of the 1974 Act are applied—
(a)
to recognised bodies in accordance with section 9(2)(f) of this Act, or
(b)
to managers or employees of such bodies in accordance with section 9(2)(fb) of this Act.
(2)
The Society may disclose information about the accounts of a recognised body, or a manager or employee of a recognised body, obtained in pursuance of such rules for use—
(a)
in investigating the possible commission of an offence by the body or any of its managers or employees, and
(b)
in connection with any prosecution of the body or any of its managers or employees consequent on the investigation.
Accountants’ reports
F345
Where rules made under section 34 of the 1974 Act are applied to recognised bodies in accordance with section 9(2)(f), section 34(9) and (10) of that Act apply in relation to a recognised body as they apply in relation to a solicitor.
F355A
Where rules made under section 34 of the 1974 Act are applied to managers or employees of recognised bodies in accordance with section 9(2)(fb), section 34(9) and (10) of that Act apply in relation to a manager or employee to which the rules are applied as they apply in relation to a solicitor.
Compensation Fund
F366
(1)
“(a)
an act or omission of a recognised body or former recognised body;
(b)
an act or omission of a manager or employee, or former manager or employee, of a recognised body or former recognised body;”.
(2)
Section 36A(2) and (3) of the 1974 Act applies in relation to recognised bodies as it applies in relation to solicitors.
Solicitor who is justice of the peace not to act in certain proceedings
7
8
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F38
Restriction on employment of person struck off roll or suspended
9
F39(1)
Section 41 of the 1974 Act (except subsection (4)) shall apply to a recognised body F40(and any manager or employee of it) and its business as such as it applies to a solicitor and his practice as such.
F41(2)
No recognised body (or manager or employee of such a body) may, except in accordance with a written permission granted by the Society under this paragraph, permit a person to whom sub-paragraph (3) applies to—
(a)
be a manager of the body, or
(b)
have an interest in the body;
and for this purpose a person has an interest in the body if he has an interest in the body within the meaning of Part 5 of the Legal Services Act 2007 (see sections 72 and 109 of that Act).
(3)
This sub-paragraph applies to a person who to the knowledge of the recognised body (or, as the case may be, the manager or employee) is a person—
(a)
who is disqualified from practising as a solicitor by reason of one of the facts mentioned in section 41(1)(a), (b) or (c) of the 1974 Act (name struck off the roll, suspension etc), or
(b)
in respect of whom there is a direction in force under section 47(2)(g) of that Act (prohibition on restoration to roll).
(4)
Permission granted for the purposes of sub-paragraph (2) may be granted for such period and subject to such conditions as the Society thinks fit.
(5)
A person aggrieved by the refusal of the Society to grant permission under sub-paragraph (4), or by any conditions attached by the Society to the grant of any such permission may appeal to the High Court which may—
(a)
confirm the refusal or the conditions, as the case may be, or
(b)
grant a permission under this paragraph for such period and subject to such conditions as it thinks fit.
(6)
In relation to an appeal under sub-paragraph (5) the High Court may make such order as it thinks fit as to payment of costs.
(7)
The decision of the High Court on an appeal under sub-paragraph (5) is final.
Failure to disclose fact of having been struck off or suspended
10
F42(1)
F45(2)
It is an offence for a person (“P”) to whom sub-paragraph (3) applies—
(a)
to seek or accept from any person an interest in a recognised body, without previously informing that person (and, if different, the recognised body) that P is a person to whom that sub-paragraph applies, or
(b)
to seek or accept a position as a manager of a recognised body, without previously informing that body that P is such a person.
(3)
This sub-paragraph applies to a person—
(a)
who is disqualified from practising as a solicitor by reason of one of the facts mentioned in section 41(1)(a), (b) or (c) of the 1974 Act (name struck off the roll, suspension etc), or
(b)
in respect of whom there is a direction in force under section 47(2)(g) of that Act (prohibition on restoration to roll).
(4)
A person guilty of an offence under sub-paragraph (2) is liable on summary conviction to a fine not exceeding level 3 on the standard scale.
(5)
Subsection (2) of section 42 of the 1974 Act applies in relation to an offence under sub-paragraph (2) as it applies in relation to an offence under that section.
(6)
For the purposes of sub-paragraph (2)(a) a person seeks or accepts an interest in a recognised body if the person seeks or accepts an interest which if it were obtained by the person would result in the person having an interest in that body within the meaning of Part 5 of the Legal Services Act 2007 (see sections 72 and 109 of that Act).
Control of employment of persons convicted of offences of dishonesty and certain other persons
11
F46. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Offences in connection with orders under section 43(2) of the 1974 Act
12
F47. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Powers of Council in respect of inadequate professional services
F4813
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F49 information about suitatbility for recognition
F5014
(1)
The Society may give a notice under this paragraph if it is satisfied that it is necessary to do so for the purpose of investigating whether—
(a)
a recognised body continues to be suitable to be recognised under section 9, or
(b)
a manager of a recognised body who is not legally qualified (within the meaning of section 9A) continues to be suitable to be a manager of a recognised body.
(2)
A notice under this paragraph is a notice which requires a person within sub-paragraph (3)—
(a)
to provide information, or information of a description, specified in the notice, or
(b)
to produce documents, or documents of a description, specified in the notice.
(3)
The persons are—
(a)
the recognised body;
(b)
an employee or manager of the recognised body;
(c)
a person who has an interest in the recognised body (within the meaning of the Legal Services Act 2007 (see sections 72 and 109 of that Act)).
(4)
For the purposes of this paragraph, section 44B(4) to (7) of the 1974 Act applies—
(a)
in relation to a notice under this paragraph as if it were a notice under section 44B of that Act, and
(b)
in relation to a person given a notice under this paragraph as if that person were a person given a notice under that section,
and references in subsections (6) and (7) of that section to powers conferred by that section are to be read as references to powers conferred by this paragraph.
(5)
Where powers conferred by Part 2 of Schedule 1 to the 1974 Act are exercisable in relation to a person within paragraph (a), (b) or (c) of sub-paragraph (3), they continue to be so exercisable after the person has ceased to be a person within the paragraph in question.
(6)
Section 44BA of the 1974 Act (power to require explanation of document or information) applies in relation to a notice under this paragraph and the person to whom such a notice is given as it applies in relation to a notice under section 44B of the 1974 Act and the person to whom such a notice is given.
(7)
Subsection (1) of section 44BC of that Act (falsification of documents etc) applies in relation to an investigation of the kind mentioned in sub-paragraph (1) as it applies in relation to the investigations mentioned in that subsection, and subsections (2), (4) and (5) of that section apply accordingly.
(8)
Subsection (3) of that section (provision of false information etc) applies in relation to a requirement imposed under this paragraph as it applies in relation to a requirement imposed by section 44B of that Act, and subsections (4) and (5) of that section apply accordingly.
F5114ZA.
(1)
The Society may give a notice under this paragraph if it is satisfied that it is necessary to do so for the purpose of investigating whether a recognised sole solicitor’s practice continues to be suitable to be recognised under section 9.
(2)
A notice under this paragraph is a notice which requires a person within sub-paragraph (3)—
(a)
to provide information, or information of a description, specified in the notice, or
(b)
to produce documents, or documents of a description, specified in the notice.
(3)
The persons are—
(a)
the sole solicitor; and
(b)
an employee in the recognised sole solicitor’s practice.
(4)
For the purposes of this paragraph, section 44B(4) to (7) of the 1974 Act applies—
(a)
in relation to a notice under this paragraph as if it were a notice under section 44B of that Act, and
(b)
in relation to a person given a notice under this paragraph as if that person were a person given a notice under that section,
and references in subsections (6) and (7) of that section to powers conferred by that section are to be read as references to powers conferred by this paragraph.
(5)
Where powers conferred by Part 2 of Schedule 1 to the 1974 Act are exercisable in relation to a person within paragraph (a) or (b) of sub-paragraph (3), they continue to be so exercisable after the person has ceased to be a person within the paragraph in question.
(6)
Section 44BA of the 1974 Act (power to require explanation of document or information) applies in relation to a notice under this paragraph and the person to whom such a notice is given as it applies in relation to a notice under section 44B of the 1974 Act and the person to whom such a notice is given.
(7)
Subsection (1) of section 44BC of that Act (falsification of documents etc) applies in relation to an investigation of the kind mentioned in sub-paragraph (1) as it applies in relation to the investigations mentioned in that subsection, and subsections (2), (4) and (5) of that section apply accordingly.
(8)
Subsection (3) of that section (provision of false information etc) applies in relation to a requirement imposed under this paragraph as it applies in relation to a requirement imposed by section 44B of that Act, and subsections (4) and (5) of that section apply accordingly.
F52Power to charge for costs of investigation
F5314A
(1)
The Society may make regulations prescribing charges to be paid to the Society by recognised bodies who are the subject of a discipline investigation F54or by the sole solicitor in a recognised sole solicitor’s practice which is subject to a discipline investigation .
(2)
A discipline investigation is an investigation carried out by the Society into a failure or apprehended failure by a recognised body F55, or by a sole solicitor, or any employee, in a recognised sole solicitor’s practice, to comply with any requirement imposed by or by virtue of this Act or F56any rules applicable to them by virtue of section 9.
(3)
Regulations under this paragraph may—
(a)
make different provision for different cases or purposes;
(b)
provide for the whole or part of a charge payable under the regulations to be repaid in such circumstances as may be prescribed by the regulations.
(4)
(5)
This paragraph applies in relation to a manager or employee of a recognised body as it applies in relation to a recognised body.
F59Disciplinary powers of the Society
14B
F60(1)
This paragraph applies where the Society is satisfied that—
(a)
a recognised body, or a manager or employee of a recognised body, or
(b)
a sole solicitor, or any employee, in a recognised sole solicitor’s practice,
has failed to comply with a requirement imposed by or by virtue of this Act or any rules applicable to that person by virtue of section 9 of this Act.
(2)
The Society may do one or both of the following—
(a)
give the person a written rebuke;
(b)
direct the person to pay a penalty not exceeding £2,000.
(3)
The Society may publish details of any action it has taken under sub-paragraph (2)(a) or (b), if it considers it to be in the public interest to do so.
(4)
Where the Society takes action against a person under sub-paragraph (2)(b), or decides to publish under sub-paragraph (3) details of such action under sub-paragraph (2)(a) or (b), it must notify the person in writing that it has done so.
(5)
A penalty imposed under sub-paragraph (2)(b) does not become payable until—
(a)
the end of the period during which an appeal against the decision to impose the penalty, or the amount of the penalty, may be made under paragraph 14C, or
(b)
if such an appeal is made, such time as it is determined or withdrawn.
(6)
The Society may not publish under sub-paragraph (3) details of any action under sub-paragraph (2)(a) or (b)—
(a)
during the period within which an appeal against—
(i)
the decision to take the action,
(ii)
in the case of action under sub-paragraph (2)(b), the amount of the penalty, or
(iii)
the decision to publish the details,
may be made under paragraph 14C, or
(b)
if such an appeal has been made, until such time as it is determined or withdrawn.
(7)
The Society must make rules—
(a)
prescribing the circumstances in which the Society may decide to take action under sub-paragraph (2)(a) or (b);
(b)
about the practice and procedure to be followed by the Society in relation to such action;
(c)
governing the publication under sub-paragraph (3) of details of action taken under sub-paragraph (2)(a) or (b);
and the Society may make such other rules in connection with the exercise of its powers under this paragraph as it considers appropriate.
(8)
Before making rules under sub-paragraph (7), the Society must consult the Tribunal.
(9)
A penalty under this paragraph may be recovered as a debt due to the Society, and is to be forfeited to Her Majesty.
(10)
The Lord Chancellor may, by order, amend paragraph (b) of sub-paragraph (2) so as to substitute for the amount for the time being specified in that paragraph such other amount as may be specified in the order.
(11)
Before making an order under sub-paragraph (10), the Lord Chancellor must consult the Society.
(12)
An order under sub-paragraph (10) is to be made by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.
(13)
This paragraph is without prejudice to any power conferred on the Society, or any other person, to make an application or complaint to the Tribunal.
14C
(1)
A person may appeal against—
(a)
a decision by the Society to rebuke that person under paragraph 14B(2)(a) if a decision is also made to publish details of the rebuke;
(b)
a decision by the Society to impose a penalty on that person under paragraph 14B(2)(b) or the amount of that penalty;
(c)
a decision by the Society to publish under paragraph 14B(3) details of any action taken against that person under paragraph 14B(2)(a) or (b).
(2)
Subsections (9)(b), (10)(a) and (b), (11) and (12) of section 46 of the 1974 Act (Tribunal rules about procedure for hearings etc) apply in relation to appeals under this paragraph as they apply in relation to applications or complaints, except that subsection (11) of that section is to be read as if for “the applicant” to “application)” there were substituted any party to the appeal.
(3)
Rules under section 46(9)(b) of the 1974 Act may, in particular, make provision about the period during which an appeal under this paragraph may be made.
(4)
On an appeal under this paragraph, the Tribunal has power to make an order which—
(a)
affirms the decision of the Society;
(b)
revokes the decision of the Society;
(c)
in the case of a penalty imposed under paragraph 14B(2)(b), varies the amount of the penalty;
(d)
in the case of a recognised body, contains provision for any of the matters mentioned in paragraph 18(2);
(e)
in the case of a manager or employee of a recognised body, F61or in the case of a sole solicitor, or an employee, in a recognised sole solicitor’s practice, contains provision for any of the matters mentioned in paragraph 18A(2);
(f)
makes such provision as the Tribunal thinks fit as to payment of costs.
(5)
Where, by virtue of sub-paragraph (4)(e), an order contains provision for any of the matters mentioned in sub-paragraph (2)(c) of paragraph 18A, sub-paragraphs (5) and (6) of that paragraph apply as if the order had been made under sub-paragraph (2)(c) of that paragraph.
(6)
An appeal from the Tribunal shall lie to the High Court, at the instance of the Society or the person in respect of whom the order of the Tribunal was made.
(7)
The High Court shall have power to make such order on an appeal under this paragraph as it may think fit.
(8)
Any decision of the High Court on an appeal under this section shall be final.
(9)
This paragraph is without prejudice to any power conferred on the Tribunal in connection with an application or complaint made to it.
Lay observers
15
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F62
Complaints to Tribunal with respect to recognised bodies F63and recognised sole solicitor’s practice,
16
(1)
The Tribunal shall have jurisdiction to hear and determine any of the following complaints made to it under this paragraph with respect to a recognised body, namely—
(a)
a complaint that the body has (while a recognised body) been convicted by any court F64. . . of a criminal offence which renders it unsuitable to be recognised under section 9 of this Act;
(b)
a complaint that the body has failed to comply with F65any requirement imposed by or by virtue of this Act or with any rules applicable to it by virtue of section 9 of this Act;
F66(c)
a complaint that the body has acted in contravention of section 41 of the 1974 Act or paragraph 9(2) of this Schedule or of any conditions subject to which a permission has been granted under section 41 of that Act or that paragraph of this Schedule; or
(d)
a complaint that the body has knowingly acted in contravention of any such order as is mentioned in section 44(2) of the 1974 Act or of any conditions subject to which a permission has been granted under such an order.
F67(1A)
The Tribunal shall have jurisdiction to hear and determine any of the following complaints made to it under this paragraph with respect to a manager or employee of a recognised body (“the relevant person”)—
(a)
a complaint that the relevant person has been convicted by any court of a criminal offence which renders that person unsuitable to be a manager or employee (or both) of a recognised body;
(b)
a complaint that the relevant person has failed to comply with any requirement imposed by or by virtue of this Act or any rules applicable to the relevant person by virtue of section 9 of this Act;
(c)
a complaint that the relevant person has acted in contravention of section 41 of the 1974 Act or paragraph 9(2) of this Schedule or of any conditions subject to which a permission has been granted under that section or for the purposes of paragraph 9(2) of this Schedule;
(d)
a complaint that the relevant person has knowingly acted in contravention of an order under section 43(2) of the 1974 Act or of any conditions subject to which a permission has been granted under such an order.
F68(1B)
The Tribunal has jurisdiction to hear and determine any of the following complaints made to it under this paragraph with respect to the sole solicitor, or an employee, in a recognised sole solicitor’s practice (“the relevant person”)—
(a)
a complaint that the relevant person has been convicted by any court of a criminal offence which renders that person unsuitable to be the sole solicitor, or an employee, in a recognised sole solicitor’s practice (or both);
(b)
a complaint that the relevant person has failed to comply with any requirement imposed by or by virtue of this Act or any rules applicable to the relevant person by virtue of section 9 of this Act.
(2)
A complaint may be made to the Tribunal under this paragraph by any person.
Procedure on applications and complaints
17
In subsections F69(9) to (11) of section 46 of the 1974 Act—
F70(a)
(b)
any reference to an application or complaint made under that Act shall be construed as including a reference to any such application or complaint as aforesaid made under this Schedule; and
(c)
in the case of subsection (10)(c), any reference to a solicitor shall be construed as including a reference to a recognised body F74or, in the case of such a complaint as is mentioned in paragraph 16(1A) F75or (1B) , to a manager or employee of such a body F76or (as the case may be) to an employee in a recognised sole solicitor’s practice .
Powers of Tribunal with respect to recognised bodies
18
(1)
Where on the hearing of any complaint made to it under this Schedule F77(other than paragraph 16(1A) the Tribunal is satisfied that a recognised body—
(a)
has been convicted as mentioned in paragraph (a) of paragraph 16(1); or
(b)
has failed to comply with F78any requirement imposed by or by virtue of this Act or with any such rules as are mentioned in paragraph (b) of paragraph 16(1); or
(c)
has acted as mentioned in paragraph (c) or (d) of that provision; F79...
F79(d)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
the Tribunal may, if it thinks fit, make one or more of the orders referred to in sub-paragraph (2).
(2)
Those orders are—
(a)
an order revoking the recognition under section 9 of this Act of the body to which the complaint relates;
(b)
an order directing the payment by that body of a penalty F80. . . , to be forfeited to Her Majesty;
(c)
an order requiring that body to pay the costs incurred in bringing against it the proceedings before the Tribunal or a contribution towards those costs, being a contribution of such amount as the Tribunal considers reasonable.
F81(2A)
Where, on the hearing of any application or complaint made to it under this Schedule, the Tribunal is satisfied that more than one allegation is proved against the recognised body to whom the application or complaint relates, it may impose a separate penalty (by virtue of sub-paragraph (2)(b) ) with respect of each such allegation.
F82(3)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(4)
F83. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F8418A
(1)
Where, on the hearing of any complaint made to it under paragraph 16(1A) F85or (1B) of this Schedule, the Tribunal is satisfied that a manager or employee of a recognised body F86, or the sole solicitor, or an employee, in a recognised sole solicitor’s practice —
(a)
has been convicted as mentioned in paragraph (a) of paragraph 16(1A) F87or (as the case may be) paragraph (a) of paragraph 16(1B) ,
(b)
has failed to comply with any requirement imposed by or by virtue of this Act or any rules applicable to the relevant person by virtue of section 9 of this Act, or
(c)
F88(in the case of a manager or employee of a recognised body) has acted as mentioned in paragraph (c) or (d) of paragraph 16(1A),
the Tribunal may, if it thinks fit, make one or more of the orders referred to in sub-paragraph (2).
(2)
Those orders are—
F89(za)
in the case of a complaint relating to a sole solicitor, or an employee, in a recognised sole solicitor’s practice, an order revoking the recognition under section 9 of this Act of the sole solicitor’s practice;
(a)
an order directing the payment by the relevant person of a penalty to be forfeited to Her Majesty;
(b)
an order requiring the Society to consider taking such steps as the Tribunal may specify in relation to the relevant person;
(c)
if the person is not a solicitor, an order which states one or more of the matters mentioned in sub-paragraph (3);
(d)
an order requiring the Society to refer to an appropriate regulator any matter relating to the conduct of the relevant person.
(3)
The matters referred to in sub-paragraph (2)(c) are—
(a)
that as from the specified date—
(i)
no solicitor or employee of a solicitor shall employ or remunerate, in connection with the practice carried on by that solicitor, the person with respect to whom the order is made, and
(ii)
no recognised body, or manager or employee of such a body, shall employ or remunerate that person, in connection with the business of the recognised body,
except in accordance with a Society permission;
(b)
that as from the specified date no recognised body or manager or employee of such a body shall, except in accordance with a Society permission, permit the person with respect to whom the order is made to be a manager of the body;
(c)
that as from the specified date no recognised body or manager or employee of such a body shall, except in accordance with a Society permission, permit the person with respect to whom the order is made to have an interest in the body.
(4)
For this purpose a person has an interest in a body if the person has an interest in the body within the meaning of Part 5 the Legal Services Act 2007 (see sections 72 and 109 of that Act).
(5)
Subsections (1) to (1C), (3) and (4) of section 44 of the 1974 Act (offences in connection with orders under section 43(2) of that Act) apply in relation to an order under sub-paragraph (2)(c) as they apply in relation to an order under section 43(2) of that Act, except that references in those subsections to provision within section 43(2)(a), (b) or (c) of that Act are to be read as references to provision within sub-paragraph (3)(a), (b) or (c).
(6)
Section 44(2) of the 1974 Act, paragraph 16(1)(d) and (1A)(d) of this Schedule and paragraph 15(3A) of Schedule 14 to the Courts and Legal Services Act 1990 apply in relation to an order under sub-paragraph (2)(c) as they apply in relation to an order under section 43(2) of the 1974 Act.
(7)
For the purposes of sub-paragraph (2)(d) an “appropriate regulator” in relation to the relevant person means—
(a)
if the person is an authorised person in relation to a reserved legal activity for the purposes of the Legal Services Act 2007, any relevant approved regulator (within the meaning of that Act) in relation to that person, and
(b)
if the person carries on activities which are not reserved legal activities, any body which regulates the carrying on of such activities by the person.
Powers of Tribunal in respect of inadequate professional services
19
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F90
Powers of Tribunal in respect of legal aid complaints
20
(1)
Where the Tribunal makes any such order as is referred to in subsection (2A) of section 47 of the 1974 Act in the case of a solicitor who is F91a manager or employee of a recognised body, the Tribunal may, if it thinks fit, order that any solicitor who is for the time being a F92manager of that body shall be excluded (either permanently or for a specified period) from F93criminal legal aid work (as defined in that section) .
F94(1A)
Where the Tribunal makes any such order as is referred to in section 47(2A) of the 1974 Act in the case of a solicitor who is an employee in a recognised sole solicitor’s practice, the Tribunal may, if it thinks fit, order that any solicitor who is for the time being the sole solicitor in that practice shall be excluded (either permanently or for a specified period) from criminal legal aid work (as defined in that section).
(2)
F95. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Revocation of recognition by reason of default by director
21
(1)
Where—
(a)
(b)
(c)
any such order as is mentioned in paragraph (a) or (b) is made in the case of a person employed by a recognised body and the act or omission constituting the ground on which the order was made was instigated or connived at by a F101manager of the recognised body or, if the act or omission was a continuing act or omission, a F101manager of the body had or reasonably ought to have had knowledge of its continuance, F102or
(d)
any such order as is mentioned in paragraph (a) or (b) is made in the case of a person employed in a recognised sole solicitor’s practice and the act or omission constituting the ground on which the order was made was instigated or connived at by the sole solicitor, or, if the act or omission was a continuing act or omission, the sole solicitor had or reasonably ought to have had knowledge of its continuance,
the Tribunal may, on an application made with respect to the recognised body F103or the recognised sole solicitor’s practice by or on behalf of the Society, by order revoke its recognition under section 9 of this Act.
(2)
The Tribunal shall not take a case into consideration during any period within which proceedings by way of appeal may be brought which may result in sub-paragraph (1) being rendered inapplicable in that case, or while any such proceedings are pending.
(3)
Any reference to a F104manager of a recognised body F105, or to a sole solicitor in a recognised sole solicitor’s practice, in any of paragraphs (a) to (c) of sub-paragraph (1) includes a reference to a person who was a F104manager of the body F106, or the sole solicitor in the practice, at the time of the conduct leading to the making of the order referred to in that paragraph.
F107(4)
The reference in paragraph (c) of sub-paragraph (1) to a person employed by a recognised body F108, or in a sole solicitor’s practice, includes a reference to a person who was so employed at the time of the conduct leading to the making of the order referred to in that paragraph.
Costs: general modification of provisions of Part III of 1974 Act
22
(1)
In the provisions to which this paragraph applies—
(a)
any reference to a solicitor or to a client of a solicitor shall be construed as including a reference to a recognised body or to a client of such a body; and
(b)
any reference to a client’s solicitor shall be construed as including a reference to any recognised body acting for a client.
(2)
This paragraph applies to the following provisions of the 1974 Act (which relate to the remuneration of solicitors in respect of contentious and non-contentious business), namely—
section 56 (except subsections (1)(e) and (5));
sections 57 to 59;
section 60 (except subsection (5));
sections 61 and 62;
sections 64 and 65;
section 67;
section 69(1); and
sections 70 to 74.
Orders as to remuneration for non-contentious business
23
F109(1)
In relation to an order under section 56 of the 1974 Act F110prescribing (by virtue of paragraph 22) general principles to be applied when determining the remuneration of recognised bodies in respect of non-contentious business, subsection (5) of that section shall have effect as if—
(a)
in paragraph (a), for “the solicitor” there were substituted “the recognised body”
; and
F111(b)
in paragraph (d), the reference to the solicitor or any employee of the solicitor who is an authorised person were a reference to any manager or employee of the recognised body who is an authorised person.
F112(2)
In this paragraph “authorised person” means a person who is an authorised person in relation to an activity which is a reserved legal activity, within the meaning of the Legal Services Act 2007 (see section 18 of that Act).
Effect of contentious business agreements
F11324
(1)
This paragraph applies in relation to a contentious business agreement made between a recognised body and a client.
(2)
A provision in the agreement that the body shall not be liable for the negligence of any of its managers or employees shall be void if the client is a natural person who, in entering that agreement, is acting for purposes which are outside his trade, business or profession.
(3)
A provision in the agreement that the body shall be relieved from any responsibility to which it would otherwise be subject in the course of carrying on its business as a recognised body shall be void.
(4)
A provision in the agreement that any manager of the body shall be relieved from any responsibility to which the manager would otherwise be subject in the course of the carrying on by the body of its business as a recognised body shall be void.
Effect on contentious business agreement of supervening incapacity of recognised body to act for client
25
(1)
If, after some business has been done under a contentious business agreement made between a recognised body and a client but before the body has wholly performed it, the body ceases to be capable of wholly performing it by reason of one of the following events, namely—
(a)
the body ceases (for any reason) to be a recognised body;
F114(b)
a relevant insolvency event occurs in relation to the body;
(c)
the client terminates the retainer or employment of the body in favour of another recognised body or a solicitor (as, notwithstanding the agreement, he shall be entitled to do),
any party to, or the representative of any party to, the agreement may apply to the court, and the court shall have the same jurisdiction as to enforcing the agreement so far as it has been performed, or setting it aside, as the court would have had if the recognised body were still capable of wholly performing it.
(2)
The court, notwithstanding that it is of the opinion that the agreement is in all respects fair and reasonable, may order the amount due in respect of business under the agreement to be ascertained by F115assessment, and in that case—
(a)
the F116costs officer, in ascertaining that amount, shall have regard so far as may be to the terms of the agreement; and
(b)
payment of the amount found by him to be due may be enforced in the same manner as if the agreement had been wholly performed.
(3)
If in such a case as is mentioned in sub-paragraph (1)(c) an order is made for the F115assessment of the amount due to the recognised body in respect of the business done under the agreement, the court shall direct the F116costs officer to have regard to the circumstances under which the termination of the body’s retainer or employment has taken place, and the F116costs officer, unless he is of the opinion that there has been no default, negligence, improper delay or other conduct on the part of F117any manager or employee of the body affording the client reasonable ground for terminating its retainer or employment, shall not allow to the body the full amount of the remuneration agreed to be paid to it.
F118(4)
For the purposes of this paragraph a relevant insolvency event occurs in relation to a recognised body if—
(a)
a resolution for a voluntary winding-up of the body is passed without a declaration of solvency under section 89 of the Insolvency Act 1986;
(b)
the body enters administration within the meaning of paragraph 1(2)(b) of Schedule B1 to that Act;
(c)
an administrative receiver within the meaning of section 251 of that Act is appointed;
(d)
a meeting of creditors is held in relation to the body under section 95 of that Act (creditors' meeting which has the effect of converting a members' voluntary winding up into a creditors' voluntary winding up);
(e)
an order for the winding up of the body is made.
F119Assessments with respect to contentious business
26
F120(1)
Subject to the provisions of any rules of court, on every F121assessment of costs in respect of any contentious business done by a recognised body, the F122costs officer may—
(a)
allow interest at such rate and from such time as he thinks just on money disbursed by the body for the client, and on money of the client in the possession of, and improperly retained by, the body F123or any manager or employee of the body; and
(b)
in determining the remuneration of the body, have regard to the skill, labour and responsibility on the part of F124any authorised person, being a manager or employee of the body, which the business involved.
F125(2)
In this paragraph “authorised person” means an authorised person, in relation to an activity which is a reserved legal activity, within the meaning of the Legal Services Act 2007.
Power of court to order delivery of bill of costs, etc.
27
Any jurisdiction—
(a)
of the High Court to make any such orders as are referred to in subsection (1) of section 68 of the 1974 Act in relation to a solicitor (whether or not business has been done by him in the High Court); or
(b)
of the county court F126or the family court to make any such orders as are referred to in subsection (2) of that section in relation to a solicitor,
shall be exercisable in like manner in relation to a recognised body.
Power of court to order recognised body to pay over clients’ money
28
Any jurisdiction of the High Court to make, in the case of a solicitor who is acting or has acted as such for a client, an order requiring the payment or delivery up of, or otherwise relating to, money or securities which the solicitor has in his possession or control on behalf of the client shall be exercisable in like manner in the case of a recognised body which is acting or has acted as such for a client F127or any manager or employee of such a body.
Actions to recover costs
F12829
(1)
“(a)
signed on behalf of the recognised body by any manager or employee of the body authorised by it to do so, or
(b)
enclosed in, or accompanied by, a letter which is so signed and refers to the bill.”
(2)
Subsection (2E) of that section shall have effect in relation to such a bill as if for “the solicitor” there were substituted “
the recognised body
”
.
Power of Society to inspect files relating to certain proceedings
30
Section 83 of the 1974 Act shall apply in relation to proceedings which have been brought with respect to a recognised body for any of the following purposes, namely—
(a)
for the winding-up of the body;
F129(b)
for the appointment of an administrative receiver within the meaning of section 251 of the Insolvency Act 1986; or
(c)
for the F130appointment of an administrator under Schedule B1 to the Insolvency Act 1986,
as it applies in relation to proceedings in bankruptcy which have been taken against a solicitor.
Bank accounts
31
Where rules made under section 32(1) F131. . . of the 1974 Act are applied to recognised bodies in accordance with section 9(2)(f) of this Act, section 85 of the 1974 Act shall apply in relation to a recognised body which keeps an account with a bank F132or building society in pursuance of any such rules as it applies in relation to a solicitor who keeps such an account in pursuance of rules under section 32.
F13331A
Where rules made under section 32(1) of the 1974 Act are applied to managers or employees in accordance with section 9(2)(fb) of this Act, section 85 of the 1974 Act shall apply in relation to a manager or employee to whom the rules are applied who keeps an account with a bank or building society in pursuance of any such rules as it applies in relation to a solicitor who keeps such an account in pursuance of rules under section 32.
Intervention by Society
32
(1)
Subject to sub-paragraph (2), where—
(a)
(b)
a person has been appointed receiver or manager of property of a recognised body; or
F137(c)
a relevant insolvency event occurs in relation to a recognised body; or
(d)
the F138Society has reason to suspect dishonesty on the part of any F139manager or employee of a recognised body in connection with
F140(i)
that body's business,
(ii)
any trust of which that body is or was a trustee,
(iii)
any trust of which the manager or employee is or was a trustee in his capacity as such a manager or employee, or
(iv)
the business of another body in which the manager or employee is or was a manager or employee or the practice (or former practice) of the manager or employee; or
F141(da)
the Society considers that there has been undue delay on the part of the personal representatives of a deceased solicitor who immediately before death was practising as the sole principal of a recognised body in connection with the recognised body’s business or in connection with any trust; or
(db)
the Society is satisfied that a solicitor practising as the sole principal of a recognised body is incapacitated by illness, injury or accident to such an extent as to be unable to attend to the solicitor’s practice or to the recognised body’s business; or
F142(e)
the Society is satisfied that it is necessary to exercise the powers conferred by Part 2 of Schedule 1 to the 1974 Act (or any of them) in relation to a recognised body to protect—
(i)
the interests of clients (or former or potential clients) of the recognised body,
(ii)
the interests of the beneficiaries of any trust of which the recognised body is or was a trustee, or
(iii)
the interests of the beneficiaries of any trust of which a person who is or was a manager or employee of the recognised body is or was a trustee in that person's capacity as such a manager or employee;
the powers conferred by Part II of Schedule 1 to the 1975 Act shall be exercisable in relation to the recognised body and its business in like manner as they are exercisable in relation to a solicitor and his practice.
F143(1A)
For the purposes of this paragraph a relevant insolvency event occurs in relation to a recognised body if—
(a)
a resolution for a voluntary winding-up of the body is passed without a declaration of solvency under section 89 of the Insolvency Act 1986;
(b)
the body enters administration within the meaning of paragraph 1(2)(b) of Schedule B1 to that Act;
(c)
an administrative receiver within the meaning of section 251 of that Act is appointed;
(d)
a meeting of creditors is held in relation to the body under section 95 of that Act (creditors' meeting which has the effect of converting a members' voluntary winding up into a creditors' voluntary winding up);
(e)
an order for the winding up of the body is made.
(2)
F144. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F14532A.
On the death of a solicitor practising as the sole principal of a recognised body, paragraphs 6 to 8 of Schedule 1 to the 1974 Act shall apply to the client accounts of the recognised body.
33
The powers conferred by Part II of Schedule 1 to the 1974 Act shall also be exercisable as mentioned in paragraph 32(1) of this Schedule where—
F146(a)
the Society is satisfied that there has been undue delay—
(i)
on the part of a recognised body in connection with any matter in which it is or was acting on behalf of a client or with any trust of which it is or was a trustee, or
(ii)
on the part of a person who is or was a manager or employee of a recognised body in connection with any trust of which the manager or employee is or was a trustee in his capacity as such a manager or employee;
(b)
the Society by notice in writing invites the body to give an explanation within such period following the giving of the notice as may be specified in it, being a period of not less than eight days; and
(c)
the body fails within that period to give an explanation which the F147Society regards as satisfactory; and
(d)
the Society gives notice of the failure to the body and (at the same or any later time) notice that the powers conferred by Part II of Schedule 1 to the 1974 Act are accordingly exercisable in its case by virtue of this paragraph.
34
(1)
Where the recognition of a body F148. . . under section 9 of this Act—
(a)
has been revoked F149in accordance with rules under that section or by an order of the Tribunal under this Schedule; or
(b)
has expired and no further recognition of that body has been granted under that section,
the powers conferred by Part II of Schedule 1 to the 1974 Act shall be exercisable in relation to the body F148. . . and its former business as a recognised body as they are exercisable in relation to a solicitor and his practice.
(2)
Where the powers conferred by Part II of Schedule 1 to the 1974 Act are exercisable in relation to a recognised body in accordance with paragraph 32 or 33 of this Schedule they shall continue to be so exercisable after that body’s recognition under section 9 of this Act has been revoked or has otherwise ceased to be in force.
35
In connection with the application of Part II of Schedule 1 to the 1974 Act for the purposes of this Schedule, in that Part of that Schedule—
(a)
any reference to the solicitor or to his practice shall be construed as including a reference to the body F150. . . in relation to which the powers conferred by that Part of that Schedule are exercisable by virtue of paragraph 32, F15132A, 33 or 34(1) of this Schedule or to its business (or former business) as a recognised body;
(b)
any reference to paragraph 1 of that Schedule shall be construed as including a reference to paragraph 32 or 34(1) of this Schedule; F152. . .
F153(ba)
any reference to paragraph 2 of that Schedule shall be construed as including a reference to paragraph 32A of this Schedule;
(c)
any reference to paragraph 3 of that Schedule shall be construed as including a reference to paragraph 33 of this Schedule.
F154(d)
paragraph 6(2)(a) of that Schedule is to be construed as including a reference to sums of money held by or on behalf of the recognised body in connection with any trust of which a person who is or was a manager of the recognised body is or was a trustee in his capacity as such a manager;
(e)
paragraph 9 of that Schedule is to be construed—
(i)
as if sub-paragraph (1) included a reference to documents in the possession or under the control of the recognised body in connection with any trust of which a person who is or was a manager or employee of the recognised body is or was a trustee in his capacity as such a manager or employee, and
(ii)
as applying to such a manager or employee and documents and property in his possession or under his control in connection with such a trust as it applies to a solicitor and documents and property in the possession or under the control of the solicitor;
(f)
paragraph 11(1) of that Schedule is to be construed as including a power for the Society to apply to the High Court for an order for the appointment of a new trustee to a trust in substitution for a person who is a trustee, in his capacity as a manager or employee of the recognised body; and
(g)
paragraph 13A of that Schedule is to be read as if the references to a former partner were references—
(i)
in the case of a recognised body which is a partnership, to a former partner in the partnership, and
(ii)
in any other case to a manager or former manager of the recognised body.
Privilege from disclosure etc.
36
F155(1)
Where a recognised body acts as such for a client, any communication, document, material or information is privileged from disclosure in like manner as if the recognised body had at all material times been a solicitor acting for the client.
(2)
Any enactment or instrument making special provision in relation to a solicitor or other legal representative as to the disclosure of information, or as to the production, seizure or removal of documents, with respect to which a claim to professional privilege could be maintained shall, with any necessary modifications, have effect in relation to a recognised body as it has effect in relation to a solicitor.
(3)
F156In F157... F158sections F159748(4), 749 and 771(5) and (6) and 788(5) and (6) of the Income Tax Act 2007 F160and section 832(5) and (6) of the Corporation Tax Act 2010 any reference to a solicitor’s client shall, in relation to a solicitor who is F161a manager or employee of a recognised body, be construed as a reference to a client of that body.
F162(4)
This paragraph does not apply to a recognised body which holds a licence under Part 5 of the Legal Services Act 2007 (alternative business structures).
Modification of enactments relating to conveyancing etc.
37
In the following provisions, namely—
(a)
sections 10(2), 48 and 182 of the M1Law of Property Act 1925;
(b)
F163. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(c)
section 12 of the M2Land Charges Act 1972;
(d)
section 13 of the M3Local Land Charges Act 1975; F164. . .
(e)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F164
any reference to a solicitor shall be construed as including a reference to a recognised body, and any reference to a person’s solicitor shall be construed as including a reference to a recognised body acting for that person.