HL Deb 20 July 1988 vol 499 cc1382-9

7.11 p.m.

Lord Morton of Shuna

My Lords, I beg to move that this Bill be now read a second time.

The main purpose of the Bill is to give the Council of the Law Society and the Scottish Solicitors' Discipline Tribunal powers to discipline solicitors who do poor professional work; that is, work which is not of the quality which could reasonably be expected of a competent solicitor. The powers which the Bill provides are broadly similar to those given to the English Law Society by Section 1 of the Administration of Justice Act which experience has shown in general works satisfactorily.

The Bill, promoted by the Law Society of Scotland, has found general favour with Members from both sides of the House. We should be grateful to Mr. Alistair Darling, the Member of Parliament for Edinburgh, Central, who steered the Bill through another place. The Bill has widespread support from consumer interests and will be appreciated by the small minority of clients who find that they have a complaint about their solicitor.

Under the Solicitors (Scotland) Act 1980, the Law Society of Scotland has a duty to promote the interests of the solicitor profession in Scotland and the interests of the public in relation to that profession. The 1980 Act provides for making of rules by the Council of the Law Society regulating professional practice, conduct and discipline. These rules require to be approved by the Lord President of the Court of Session. The Act also provides for complaints to be made to the Scottish Solicitors' Discipline Tribunal of cases of apparent professional misconduct and for the tribunal to investigate such complaints. A range of disciplinary powers is available to the tribunal. This Bill, however, would expand these powers to cover cases where the standard of professional service was inadequate although not necessarily of a standard which might be regarded as falling within the generally accepted meaning of professional misconduct. The new measures should help to reduce public dissatisfaction at the present over-rigid distinction between matters of conduct, where the disciplinary machinery applies, and matters of negligence where the client can only find a remedy through raising a civil action in the courts.

Complaints about the work of solicitors vary. In some cases a complaint may be fairly minor, perhaps about work which has not been done to the standard sought by the client. At other extremes there are fortunately rare cases which attract widespread publicity, where a solicitor's conduct falls very far short of what is expected. The more extreme cases are already provided for in legislation which provides a framework for investigating complaints and disciplining solicitors through the Scottish Solicitors' Discipline Tribunal. The tribunal has many of the powers of a court and it can censure, fine or even strike-off a solicitor who is found guilty of professional misconduct. There is nothing in these provisions to provide a quick remedy for the client. What is provided in the Bill is a system for investigating the less serious type of complaint in cases where the services are not of a quality which could reasonably be expected of a competent solicitor. The Bill gives powers to the Law Society to investigate such cases and, if it upholds the complaint, to prescribe certain remedies. A solicitor might be asked to refund part or all of the fees paid by the client; or to take steps at his own expense to correct shoddy work; or to instruct another solicitor to rectify the deficiency.

The purpose of the Bill is, first, to extend the powers of the Council of the Law Society to enable it to investigate complaints against solicitors of inadequate professional services and to require solicitors, where such complaints are established, to take action to provide a remedy to the client.

These powers would be in addition to, and distinct from, the existing powers which the council already has for dealing with misconduct. The Bill also contains substantial provisions to protect the solicitor from unjustifiable complaints. As well as the wide discretion available to the Council of the Law Society as to whether or not to use its disciplinary powers, the Bill provides for an appeal procedure to the discipline tribunal and to the Court of Session.

Secondly, the Bill seeks to extend the role of the discipline tribunal so that it can deal with inadequate professional services as well as performing its existing function in relation to professional misconduct. The tribunal would maintain its function as an appeals body to which solicitors aggrieved at a decision of the Council of the Law Society can turn. As an appeal body it would have powers to quash, confirm, or vary any determination or direction by the council. It would also have an enforcement function to ensure that solicitors comply with decisions of the council.

Thirdly, the Bill gives the Lay Observer for Scotland power to report complaints directly to the discipline tribunal. The Lay Observer is the independent person appointed by the Secretary of State to investigate complaints from members of the public about the Law Society's handling of allegations against solicitors. The Lay Observer sees the Law Society's files, can issue an opinion analysing the case and set out her conclusions. These may include recommendations that the Law Society should take certain actions on the complaints. This opinion is not however legally binding on the Law Society. It has been said that the Lay Observer for Scotland holds an office which has no teeth. The Bill deals firmly with criticism of that kind by giving the Lay Observer power to report cases direct to the discipline tribunal. The new power is included in the Bill largely in response to representations from the Lay Observer herself, from consumer organisations and the public generally who have been concerned that the Lay Observer has no real power and can only work through unenforceable criticism of the Law Society's handling of a complaint. The Law Society, however, would retain responsibility for dealing with complaints against solicitors in the first instance and the Lay Observer would only become involved after the Law Society had reached a final decision on a complaint. The Lay Observer is not empowered to conduct cases at the tribunal, merely to report cases to the tribunal.

The Bill would also allow the Law Society to suspend a solicitor's practising certificate in cases where it believes that there has been professional misconduct arising through grossly overcharging fees to a client. Here again there are provisions for the solicitor to appeal to the court.

Since the Bill has been discussed in another place some of its provisions have been criticised, I suspect due largely to misunderstanding. Some solicitors have raised the question of whether the giving of legal advice should be the sole preserve of solicitors. That has never been the case. Accountants, tax advisers, and planning consultants and many more require to give legal advice when carrying out their professional work. This has always been and will remain the practice. What also remains unaltered by the Bill is that it is still a criminal offence for anyone to represent himself as a solicitor if he is not a solicitor.

The other matter which has been raised is whether people will be able to gain access to a lawyer's papers against the client's will. This is a total misconception of the Bill. A person "having an interest" may make a complaint. Such a person would be the client himself, somebody related to the client such as a beneficiary under a will or the client's executor or family. It could not be the client's opponent in the litigation.

The power is given to the Law Society to require production of papers and not to the person making the complaint. It does not require the Law Society to make papers available to the person who makes the complaint. It is necessary that the Law Society should have the powers to see the solicitor's papers to find out if there is anything in the complaint.

The Bill also makes a number of miscellaneous amendments to the Solicitors (Scotland) Act 1980. They include important provisions which are necessary to enable the Law Society to gain full recognition as a professional body under the provisions of the Financial Services Act. An important survey carried out by the Consumer Council in Scotland showed that 84 per cent. of clients were satisfied with their solicitors. The system for investigating complaints against solicitors, which the Bill will improve, has a part to play in maintaining that trust. Public standing of the solicitor profession is high and that is due partly to the rigorous system of support and supervision exercised by the Law Society. It is very significant that the Law Society should have seen fit to seek further powers to improve that important function.

I suggest that the Bill is a sensible and worthwhile measure. It contains a number of valuable provisions which will prove to be of considerable benefit to clients and solicitors and it will strengthen the relationship built on trust which exists between solicitors and their clients. I commend the Bill to your Lordships and I beg to move.

Moved, that the Bill be now read a second time.—(Lord Morton of Shuna.)

7.21 p.m.

Lord Mackie of Benshie

My Lords, I welcome the Bill because, in spite of the Law Society's present powers, there still exist hundreds of stories of incompetence by solicitors. They appear to go unpunished and certainly there is no redress for the client.

I hope that adequate professional competence includes the management of people's money. One of the worst cases of which I know is that of some old cousins of my grandfather. My father thought that they were becoming progressively better off because as another died they received a little more money. However, they appeared to him to be getting poorer. Eventually he discovered that the solicitor had left their money in government bonds at the end of the war and they were becoming poorer and poorer. My father obtained control of the money and, although a simple farmer, managed to double their income in a short space of time.

Another example is that of a French lady of whom I know who in 1949 married a Scotsman. She had a son in 1950. Eighteen years later she was much bothered by the French Army calling up her son in spite of her solicitor having written to explain that she was a British citizen. Eventually she had to write and she discovered that her solicitor had given her marriage date as 1959, her son having been born in 1950. It is the kind of mistake which can be slightly embarrassing and which is repeated in many cases. Therefore I am glad that the profession is keen to introduce measures which will help.

A number of issues have been raised by the Scottish Law Society. I believe that the definition of the phrase "adequate professional competence" is a little difficult but that it must be broad. The only way in which one can assess that is by competent solicitors and competent people deciding what is competent. I believe that several of the complaints have some ground, and the noble Lord who is promoting the Bill dealt with one or two of them. As regards a solicitor having to defend a case which is rubbish but which costs him money, it might be as well if he could claim his expenses. There will certainly he frivolous and imaginary complaints brought against solicitors.

I find interesting the phrase "grossly excessive fees". Do I gather that excessive fees are all right hut that they must be grossly excessive to he caught by the Bill? Or is it merely a question of the difficulty of definition?

I welcome the Bill. It is necessary for the profession to police itself. It needs the backing of law and the Bill appears to be necessary. I wonder what is meant by Clause 1(2)(b) on page 2 of the Bill. It states: to direct the solicitor to secure the rectification at his own expense of any such error, omission or other deficiency arising in connection with the services as the Council may specify". Does rectification apply if he has lost the client a great deal of money by failing to put forward an offer on a house or to buy a share? Or does it apply only to his fees? It is a little unclear and it appears that under the present law one must sue. However, if that is the meaning of the provision I believe that it is a good thing.

I welcome the Bill and I should be pleased to have an explanation of the points that I have raised.

7.26 p.m.

Lord Carmichael of Kelvingrove

My Lords, in such august legal company I should briefly like to welcome the Bill. My noble friend Lord Morton of Shuna should be congratulated for having taken up the baton from my honourable friend in another place, Alistair Darling. We should also thank the Law Society for going into a great deal of detail in order to answer many of the calls that it has had over the years concerning solicitors and including those on the Bill.

The noble Lord, Lord Mackie, spoke of the hundreds of stories that one hears. Many of them are apocryphal and I am sure that we could cite our own examples of solicitors who have not been quite up to the mark. I believe that it is right that the layman should be given some protection. There is a certain fear or strangeness when confronting a solicitor who apparently knows his way around. Perhaps the Bill will go some way towards reducing the law's delays, at least as regards those caused by dilatoriness on the part of solicitors. We may have another Bill from the Law Society or the Society of Advocates to abolish some of the law's delays which occur in the courthouses.

Embodied in the Bill is the fact that on occasions a solicitor needs protection from clients, and that is also important. It is not one-way traffic. From what I have seen of the Bill, and from what my noble friend Lord Morton has described, I understand that there is a certain protection for solicitors from clients who are perhaps unreasonable.

I am sure that the Bill is needed. I believe that we should thank the Law Society for taking the work seriously. It has a great deal of experience of complaints from solicitors and I hope that the existence of the Bill will improve the service to the clients. One does not know who will be the solicitors' clients the next day or the next week, so the Bill could apply to almost anyone in the land. The Bill may give solicitors a better framework in which to work. At least they will know where they stand as regards discipline and the powers of the Law Society. The Bill should be beneficial all round and I welcome it.

7.30 p.m.

The Lord Advocate (Lord Cameron of Lochbroom)

My Lords, this Bill has the full support of the Government. We were very pleased to lend the Law Society of Scotland assistance with its drafting. I echo the noble Lord, Lord Morton of Shuna, in congratulating Mr. Alistair Darling, for introducing the Bill in another place on behalf of the Law Society and I would further congratulate the noble Lord for introducing it in your Lordships' House. Perhaps I may describe him as a worthy advocate for a solicitor's Bill since he has practised on both sides of the profession.

I know from consultations which have taken place that there is wide support for the Bill among such groups as the Scottish Consumer Council and the Scottish Association of Citizens' Advice Bureaux which may reasonably be said to represent the interests of clients. The noble Lord, Lord Mackie of Benshie, in giving a welcome to the Bill, made a reference to hundreds of cases of dissatisfaction but perhaps I may remind him, as the noble Lord, Lord Morton, said in opening, that the Scottish Consumer Council carried out a survey just over a year ago and found that 84 per cent. of the public were satisfied—and that says a lot for the profession.

I am also aware of anxiety about some aspects of the Bill from groups with the solicitor profession itself. I think there has been some misunderstanding of certain of the Bill's provisions, and I was glad to hear the noble Lord, Lord Morton, deal with those in opening. It has not perhaps been fully appreciated that the basic structure of the legislation affecting solicitors, including the discipline provisions, remains unaltered.

In the vast majority of cases, clients are fully satisfied with the services provided by their solicitor. In a few unhappy instances, however, this is not so. The powers contained in this Bill will enable the council of the Law Society to take appropriate action to deal with the less serious disciplinary cases. The noble Lord, Lord Mackie, referred to grossly excessive fees. That is clearly a provision which the Law Society wished to see included and I can understand why they felt that that was appropriate in a Bill dealing with discipline.

The basic principles of the Bill are quite simple and, I suggest, hard to challenge. Few people can object to a system which gives redress to the client who has received services which fell short of what might reasonably be expected from a competent solicitor. The Bill contains nothing to alarm the solicitor who provides a satisfactory service. Not only has great care been taken to ensure that the solicitor has a fair hearing before the Council of the Law Society reaches a decision on a complaint, but there is provision for appeal to the discipline tribunal and, thereafter, to the Court of Session, as the noble Lord, Lord Morton, reminded us.

I welcome the new power given to the lay observer to report a case direct to the discipline tribunal where a dissatisfied client has reported the case to the Lay Observer and the latter is unhappy about the outcome of the case after investigation by the Law Society. This power, as well as the main provisions of the Bill dealing with inadequate professional services, has been available in England and Wales for a few years now and I suggest it is appropriate that Scotland should have it also.

I should underline that the lay observer would not utilise the new power until the Law Society had reached a decision on a case. Primary responsibility for investigating complaints about solicitors will remain with the Law Society. My right honourable friend the Secretary of State for Scotland intends to issue a direction in this sense to the Lay Observer in respect of the new power if the Bill is enacted.

The procedures which will apply in the event of a report from the Lay Observer to the disciplinary tribunal are matters appropriately to be dealt with under the disciplinary tribunals rules. These will be reviewed by the Lord President of the Court of Session after the enactment of the Bill.

I am grateful to the Council of the Law Society for supporting the inclusion in the Bill of a small number of amendments to the Solicitors (Scotland) Act 1980 which were the subject of consultation at the end of last year by my right honourable friend the Secretary of State for Scotland. They are designed to simplify the legislation relating to solicitors and reduce the extent to which the profession is controlled by statute.

I am conscious that there is opposition in some quarters to the removal of the reference to "legal advice" from Section 33 of the 1980 Act. That section prevents unqualified persons from suing for recovery of a fee for carrying out certain business. Many professional people already give advice on the law as part of their services to clients, for example, as the noble Lord said. on finance or planning matters. This does not mean that anyone can offer their services as a solicitor since, as the noble Lord, Lord Morton, reminded us, under Sections 31 and 32 of the 1980 Act, it is a criminal offence for an unqualified person to pretend to be a solicitor or to use any name, title or description implying that one is qualified to act as a solicitor.

Returning to the main provisions of the Bill, I know of the unease felt in certain quarters about the implications of the new discipline powers. As with any new system it is often easy to allow fears about exactly how it will operate in all imaginable situations to overshadow the benefits especially when these will fall on another party, in this case the as yet unidentified client. The Government hope these new disciplinary powers will soon he introduced. We believe they are well conceived and prescribed. But we will be taking a close interest in how the system works in practice and will be ready to discuss with the Law Society any problems which cannot be settled within the existing legislation.

I am sure that your Lordships will recognise this Bill as a valuable and welcome measure.

On Question, Bill read a second time, and committed to a Committee of the Whole House.