SQE Professional Conduct & Ethics

What are the 7 mandatory principles?

1. Uphold rule of law and administration of justice

2. Uphold public trust

3. Independence

4. Honesty

5. Integrity

6. Equality, diversity and inclusion

7. Best interests of each client

If 2 of the mandatory principles conflict, which one takes precedence?

Principles that safeguard the wider public interest

• Rule of law

• Public trust

What is the overriding objective in CPR and Criminal Procedure Rules?

• Courts have a duty to deal with cases ‘justly’

• Parties are required to help the court further this

• Failure to uphold administration of justice conflicts

What is the Code of Conduct for Solicitors?

Standard of professionalism required from individuals

What is the Code of Conduct for Firms?

Standards and business controls expected of firms

What is the SDT?

Solicitors Disciplinary Tribunal

• Independent court dealing with breaches of professional conduct

What is the SRA Enforcement Strategy?

Factors which the SRA will consider in assessing the seriousness of a breach

What is the Code of Conduct for Firms?

Standards and business controls expected of firms

Are Litigants in Person bound by the Code of Conduct?

No

Example of a breach of rule of law (Principle 1)?

Solicitor convicted of a criminal offence, engaged in criminal behaviour or behaviour that disregards the rule of law

What is proper administration of justice?

• Owing a duty to the court and to administration of justice

• Must not mislead the court

• Must not interfere with the judicial process and conduct themselves in such a way that they act in the interest of justice

Examples of interfering with proper administration of justice

• witness intimidation

• misleading the court

What are the requirements of a solicitor in a solicitor/client relationship?

1. protect their interests

2. represent their best interests

3. preserve sensitive information

When might the independence of a solicitor be questioned?

• Where referrals are made by third parties

  • Where the solicitor, acting in a case, is aware that they, or a member of their firm may be called as a witness in the matter

How does the SRA determine if a solicitor has acted dishonestly?

1. Identify the state of knowledge or belief of the solicitor as to the facts at the time

2. In view of their knowledge/belief at the time, assess whether their conduct was dishonest by the standards of ordinary decent people

Is it possible to behave without integrity without being dishonest?

Yes

When might the SRA discipline a solicitor for lacking integrity?

• where there’s been wilful or reckless disregard to standards, including indifference

• where the regulated firm or individual has taken unfair advantage of clients or third parties or allowed others to do so

• where the regulated firm/individual has knowingly or recklessly caused harm or distress to another

  • where clients or third parties have been misled

Acting with integrity applies to which ways of behaviour?

1. what a person says

2. what a person does

What does equality mean?

Making sure there is a level playing field and people are treated fairly

What does diversity mean?

Encouraging and valuing people with a broad range of different backgrounds, knowledge, skills and experiences

What does inclusion mean?

Accepting people for who they are and encouraging everyone to participate and contribute

Should you allow your personal views to affect professional relationships in the way you provide services?

NO!

Can a solicitor refuse to accept instructions from a client?

Yes, but this must not be on the grounds of any of the protected characteristics in EA 2010

What is a solicitor required to do when acting in the best interests of a client?

• observe their duty of confidentiality

• consider whether they have the appropriate expertise to deal with issues presented by the client

• consider whether they have the capacity to deal with the client’s case considering their workload

• avoid secret or unauthorised profits that might put their interests in conflict with the client’s

What should a solicitor put before their own and their client interests?

Wider professional obligations to:

• administration of justice

• the rule of law

• the courts

What is an own interest conflict?

Conflict of interests between the solicitor and the client

• Financial interest

• Claim against a friend or relative

• Claim against your company (or friends) with commercial relationship with the client

  • Advise on rectifying losses incurred by the mistake of the solicitor

Can you act in an own interest conflict?

Never

What is a general conflict of interest?

Your separate duties to act conflict between two or more clients

Can you work in a general conflict of interest?

Generally no, unless one of the exceptions apply

Can a conflict arise between a current and former client?

No - must be two current clients

What exceptions are there to a conflict of interest?

1. Substantially common interests: two clients want to buy a house together. They agree on a clear common purpose and strong consensus as to how it will be achieved

2. Competing for the same objective: both wanting to buy the same property

What are the conditions needed to rely on the exceptions of a conflict of interest?

• informed written consent of clients

• effective safeguarding

• reasonableness to act

If in doubt about application of adherence with SRA principles what should a solicitor do?

Contact Professional Ethics helpline

Can request a written decision

What is a retainer?

Contract existing between a solicitor and client. It should state clearly:

• the terms

• what work the solicitor has agreed to undertake

  • duties of the solicitor during the retainer

What should a solicitor do if a conflict is discovered before retainer?

May take instructions from only one client, or may be unable to act altogether

What is one way to remove the risk of a conflict of interest?

Restrict retainer

• expressly provide you’ll only act for clients where no conflict arises

• must be clearly communicated to clients

What should a solicitor do if a conflict is discovered during the retainer?

Inform clients and consider whether it is possible to act for both

Clients cannot consent if there is a conflict

What is a litigant in person?

Another term for a party engaged in litigation who doesn’t have legal representation

What is a McKenzie Friend?

An individual who is not legally qualified but assists someone in court

What is the duty to not abuse your position?

If a solicitor owes a divided loyalty to the court and client - must finely balance their duty to the client to properly conduct the case and not to take advantage of others

What is an undertaking?

A statement, given orally or in writing, whether or not it includes the word “undertake” or “undertaking”, to someone who reasonably places reliance on it, that you or a third party will do something or cause something to be done, or refrain from doing something

What is a solicitor’s liability when making an undertaking?

Personally liable

Are undertakings enforceable in court?

Yes

How can an undertaking be withdrawn?

Only by agreement with the other party to the undertaking Is the

Is there a time limit for completing an undertaking?

Reasonable timeframe

• HOWEVER, a solicitor should always strive for certainty and ensure there is a clear time limit on undertakings given

Should a solicitor make an undertaking where they would be reliant on a third party?

Advised to avoid on account that the solicitor has no control over whether or not that act can be delivered

What is the consequence of breaching an undertaking?

May result in action against the solicitor

• sued personally by recipient

• if liable, the solicitor may compensate the recipient personally

  • disciplinary action brought by the SRA

What is a solicitor’s duty to not mislead?

must not mislead or attempt to mislead clients, court or others Can

Can a solicitor act if their client has told them they are guilty of an offence but wish to plead not guilty?

Yes, as long as they do not present a positive defence

What conduct of litigation should a solicitor follow?

• must only make assertions or put forward statements, representations or submissions to the court which are “properly arguable”

  • must not put forward arguments you know to be frivolous or without legal or factual basis

What is the consequence of a solicitor putting forward an argument that is not properly arguable?

• waste court time (contrary to Para 2.6 CCS) and

  • may be in contempt of court

Can a solicitor act on instructions given on behalf of the client?

Yes if they are satisfied the individual has proper authority to provide instructions

• must not act if they are suspicious or have not satisfied themselves

• should get signed authority from client

What is a solicitor’s fiduciary duty?

• must avoid conflicts of interest

  • must not make any unauthorised profits

What are financial benefits?

Any commission, discount or rebate, but does not include solicitor’s fees or interest earned on any client account

What is the duty to properly account?

Solicitors must account for any financial benefit they receive as a result of their instructions, except where otherwise agreed.

• financial benefit paid directly to client or offset against client fees

When can a solicitor retain financial benefit?

Only where the client has agreed to this (client care letter, T&Cs of retainer)

Must a solicitor pay the financial benefit directly to the client?

No - the client may consent to solicitor keeping the benefit

If a solicitor and third party engage in a fee sharing agreement, what must a solicitor do?

• inform the client of any fee sharing arrangement relevant to the matter and

  • any such fee sharing arrangement is in writing

What is an introducer?

Any person, business or organisation who introduces or refers clients to a solicitor’s business.

• includes persons who recommended the solicitor to clients or otherwise puts C and S in contact

Can solicitors pay/receive referral fees?

Yes, in most cases (exceptions)

When is the payment/receipt of referral fees banned?

• claims for damages for PI or death

  • any other claim for damages arising out of circumstances involving PI or death

When does the prohibition of referral fees apply?

Only applies to claimant clients (person who makes or would make the claim)

What is an authorised body?

• authorised body

  • individual who owns, manages or is employed by an authorised body

What is reserved legal activity?

Activities that can only be carried out by a solicitor who is regulated

What are the types of reserved legal activities?

• rights of audience

• conduct of litigation

• probate services

• notarial activities

  • administration of oaths

Can an unauthorised body have “solicitor” in its title?

No, or describes its work in a way to suggest it is a law firm

What must a solicitor carrying out reserved legal activities in a non-authorised commercial body do?

• Ensure that the body takes out and maintains indemnity insurance

  • insurance must be adequate and appropriate

What is the duty of confidentiality?

• Keep client information confidential

• Not to communicate the information or misuse it to others

Does the duty of confidentiality only affect solicitors?

No - also firms, so this includes support staff

When does the duty of confidentiality apply?

Only applies where the information relates to the retainer

• any information about the client that is unrelated may not be covered by this duty

Does the duty of confidentiality cease on the client’s death?

No - continuing obligation. Passes to the PRs

What are the exceptions to the duty of confidentiality?

• disclosure permitted or required by law

  • terrorism legislation

  • criminal offences - money laundering

• client consents

What must a client consent to for disclosure to override confidentiality?

1. what information will be disclosed

2. who it will be disclosed to

3. when it will be disclosed

4. for what purposes it will be disclosed

Best to confirm in writing

When else may disclosure be permitted?

1. where a client has indicated an intention to commit suicide or serious self-harm

2. preventing harm to children or vulnerable adults

3. preventing the commission of criminal offences

These justifications do not permit disclosure after the event

When does the duty of confidentiality not arise?

Where the solicitor is being used by the client to perpetuate a fraud or any other crime

What is the duty of disclosure?

Where a solicitor is acting for a client on a matter, the solicitor must make the client aware of all information material to the matter of which they (the solicitor) have knowledge

What are the exceptions to the duty to disclose?

• disclosure is prohibited by legal restrictions imposed in the interests of national security of the prevention of crime

• solicitor’s client gives informed written consent for information to not be disclosed to them

• solicitor has reason to believe that serious physical or mental injury will be caused to their client or another if disclosed

• information is in a privileged document that solicitor has knowledge of only due to mistaken disclosure

What does “interests adverse to the interest of another” mean?

S must not act for prospective C1 if their interests are contrary to, or in dispute with, the interests of a current or former client (C2)

When could a solicitor act despite the presence of adverse interests?

• C2 provides informed written consent for S to act for C1 despite adverse interest

  • must ensure C2 has understood the issues, including risks

  • must be cautious not to break duty of confidentiality

• effective measures in place to protect C1’s information from C2

  • separate teams

  • separate servers

  • encrypted information

Is a solicitor personally accountable for compliance with CCS?

Yes

What should you do to protect your decision when a code of conduct arises?

Be able to justify the decision and action by keeping a full and frank attendance note of the code and why

Is a solicitor required to keep their knowledge up to date?

Yes - must ensure knowledge of principles, codes, account rules and law is up to date

How can a solicitor justify their decisions?

• record keeping

• maintaining effective records of when an undertaking has been given and discharged

• providing good reasons for terminating a retainer

Is a solicitor bound to interact with the SRA?

Yes on some level

• must respond promptly to SRA, providing full and accurate explanations

• ensure relevant information held by them is available for inspection

What are notification requirements?

Events that trigger an automatic obligation to notify the SRA

What are reporting requirements?

• Reporting any facts or matters that they reasonable believe are capable of amounting to a serious breach of regulatory arrangements

• Must inform SRA promptly of matters they reasonably should be brought to SRA’s attention to investigate

What are examples of notification requirements?

• criminal charges, convictions, or cautions

• insolvency events

• become aware of material changes to information previously provided to SRA

• become aware of information provided to SRA about them or their practice that may be false, misleading, incomplete or inaccurate

What is the SRA Enforcement Strategy?

Sets out factors when assessing seriousness of breach in the public interest

Do all breaches need to be reported to the SRA?

No - only those of serious misconduct

How can a solicitor satisfy their obligation to make a notification to the SRA?

If they provide the information to the firm’s compliance officer “on the understanding that” the CO will report to SRA

What does the Enforcement Strategy set out?

• when reports should be made

• private life

• when to take action

• sanctions & controls by SRA and SDT

What is remedial action?

Putting matters right and explaining fully and promptly what has happened and the likely impact

What are the client identification requirements of a solicitor?

• must identify who they’re acting for in relation to any matter

What are the SRA complaints handling requirements?

Must ensure clients are informed in writing at the time of engagement about:

• their right to complain to the solicitor about their services and charges

• how a complaint can be made and to whom

• any right they have to complain to the Legal Ombudsman and when they can make any such complaint

What is the Legal Ombudsman?

Resolves complaints about legal services. Only deal with:

• complaints of poor service NOT breach of Principles/Codes

What steps has the LO identified that a client must make to complain?

1. tell the lawyer

2. give the lawyer time (8 weeks) to resolve things

3. bring complaint to LO - 6 months to make complaint

What happens after a complaint is not resolved within 8 weeks of being made?

Solicitor must inform the client in writing:

• of any right they have to complain to LO, time frame, full contact details

• exhausted complaints procedure:

  • S cannot settle the complant

  • name and website of ADR approved body competent to deal with complaint

  • whether S agrees to use scheme

What are the SRA Transparency Rules?

Sets out information that authorised firms should make available to clients and potential clients

Is a client care letter an SRA requirement?

No

What are costs?

Solicitor’s fees and disbursements