Office of Public Sector Information
SCHEDULE 16 continued PART 1 continued
(6) Where a communications redirection order is made, the Society must pay to—
(a) in the case of an order relating to postal packets, the postal operator concerned, and
(b) in any other case, the person specified in the order,
the like charges (if any) as would have been payable for the redirection of the communications to which the order relates if the addressee had permanently ceased to occupy or use the premises or other destination of the communications and had applied to the postal operator or the specified person (as the case may be) to redirect the communications to him as mentioned in the order.
(7) The High Court may, on the application of the Society, authorise the Society, or a person appointed by it, to take such steps as may be specified in the order in relation to any website purporting to be or have been maintained by or on behalf of the solicitor or his firm if the High Court is satisfied that the taking of those steps is necessary to protect the public interest or the interests of clients (or potential or former clients) of the solicitor or his firm.
(8) In this paragraph “postal operator” and “postal packet” have the meaning given by section 125(1) of the Postal Services Act 2000.
(9) This paragraph does not apply where the powers conferred by this Part of this Schedule are exercisable by virtue of paragraph 3.”
(11) In paragraph 11(1) (trusts) for “controlled trust” substitute “trust”.
(12) In paragraph 12 (liens) for “and documents” substitute “, documents and other property”.
(13) After paragraph 13 (costs) insert—
“13A (1) The High Court, on the application of the Society, may order a former partner of the solicitor to pay a specified proportion of the costs mentioned in paragraph 13.
(2) The High Court may make an order under this paragraph only if it is satisfied that the conduct (or any part of the conduct) by reason of which the powers conferred by this Part were exercisable in relation to the solicitor was conduct carried on with the consent or connivance of, or was attributable to any neglect on the part of, the former partner.
(3) In this paragraph “specified” means specified in the order made by the High Court.”
78 Omit Schedule 1A (inadequate professional services).
79 Omit Schedule 2 (the compensation fund).
80 The Administration of Justice Act 1985 is amended in accordance with this Part of this Schedule.
81 (1) Section 9 (incorporated practices) is amended as follows.
(2) In subsection (1)—
(a) for “Council” (in both places) substitute “Society”,
(b) in paragraph (a) for “by solicitors” to the end substitute “of legal services bodies;”,
(c) in paragraph (b) for “any such services” substitute “any solicitor services or other relevant legal services”, and
(d) in paragraph (c)—
(i) for “conditions” substitute “requirements”, and
(ii) omit “corporate”.
(3) After that subsection insert—
“(1A) Where the Society makes rules under subsection (1), it must by rules under subsection (1)(c) prescribe the requirement that (subject to any exceptions provided by the rules) recognised bodies must not provide services other than—
(a) solicitor services, or
(b) solicitor services and other relevant legal services.
(1B) “Relevant legal services” means—
(a) solicitor services, and
(b) where authorised persons other than solicitors or registered European lawyers are managers or employees of, or have an interest in, a recognised body, services of the kind provided by individuals practising as such authorised persons (whether or not those services involve the carrying on of reserved legal activities within the meaning of the Legal Services Act 2007).
(1C) The Society may by rules under this section provide that services specified, or of a description specified, in the rules are not to be treated as solicitor services or other relevant legal services.”
(4) In subsection (2)—
(a) for “Council” (in both places) substitute “Society”,
(b) in paragraph (a) for “are to be” to the end substitute “, or for the renewal of such recognition, are to be made, and requiring such applications to be accompanied by a fee of such amount as the Society may from time to time determine;”,
(c) after that paragraph insert—
“(aa) for the manner and form in which other applications under the rules are to be made, and requiring such applications to be accompanied by a fee of such amount as the Society may from time to time determine;”,
(d) for paragraphs (c) to (e) substitute—
“(c) about the time when any recognition, or renewal of recognition, takes effect and the period for which it is (subject to the provisions made by or under this Part) to remain in force;
(d) for the suspension or revocation of any such recognition, on such grounds and in such circumstances as may be prescribed by the rules;
(e) about the effect on the recognition of a partnership or other unincorporated body (“the existing body”) of any change in the membership of the existing body, including provision for the existing body’s recognition to be transferred where the existing body ceases to exist and another body succeeds to the whole or substantially the whole of its business;
(ea) for the keeping by the Society of a register containing the names and places of business of all bodies which are for the time being recognised under this section, and such other information relating to those bodies as may be specified in the rules;
(eb) for information (or information of a specified description) on such a register to be made available to the public, including provision about the manner in which, and times at which, information is to be made so available;”, and
(e) after paragraph (f) insert—
“(fa) about the education and training requirements to be met by managers and employees of recognised bodies;
(fb) for rules made under any provision of the 1974 Act to have effect in relation to managers and employees of recognised bodies with such additions, omissions or other modifications as appear to the Society to be necessary or expedient;
(fc) requiring recognised bodies to appoint a person or persons to monitor compliance, by the recognised body, its managers and its employees, with requirements imposed on them by or by virtue of this Act or any rules applicable to them by virtue of this section;”.
(5) After subsection (2) insert—
“(2A) If rules under this section provide for the recognition of legal services bodies which have one or more managers who are not legally qualified, the rules must make provision—
(a) for the recognition of such bodies to be suspended or revoked, on such grounds and in such circumstances as may be prescribed by the rules;
(b) as to the criteria and procedure for the Society’s approving, as suitable to be a manager of a recognised body, an individual who is not legally qualified (and for the Society’s withdrawing such approval).
(2B) Rules under this section may make provision for appeals to the High Court against decisions made by the Society under the rules—
(a) to suspend or revoke the recognition of any body;
(b) not to approve, as suitable to be the manager of a recognised body, an individual who is not legally qualified (or to withdraw such approval).
(2C) The rules may provide for appeals against decisions within subsection (2B)(b) to be brought by the individual to whom the decision relates (as well as the body).
(2D) In relation to an appeal under rules made by virtue of subsection (2B), the High Court may make such order as it thinks fit as to payment of costs.
(2E) The decision of the High Court on such an appeal shall be final.
(2F) Where the Society decides to recognise a body under this section it must grant that recognition subject to one or more conditions if—
(a) the case is of a kind prescribed for the purposes of this section by rules made by the Society, and
(b) the Society considers that it is in the public interest to do so.
(2G) While a body is recognised under this section, the Society—
(a) must direct that the body’s recognition is to have effect subject to one or more conditions if—
(i) the case is of a prescribed kind, and
(ii) the Society considers that it is in the public interest to do so;
(b) may, in such circumstances as may be prescribed, direct that the body’s recognition is to have effect subject to such conditions as the Society may think fit.
“Prescribed” means prescribed by rules made by the Society.
(2H) The conditions which may be imposed under subsection (2F) or (2G) include—
(a) conditions requiring the body to take specified steps that will, in the opinion of the Society, be conducive to the carrying on by the body of an efficient business;
(b) conditions which prohibit the body from taking any specified steps except with the approval of the Society;
(c) if rules under this section provide for the recognition of legal services bodies which have one or more managers who are not legally qualified, a condition that all the managers of the body must be legally qualified.
“Specified” means specified in the condition.
(2I) Rules made by the Society may make provision about when conditions imposed under this section take effect (including provision conferring power on the Society to direct that a condition is not to have effect until the conclusion of any appeal in relation to it).
(2J) Section 86A of the 1974 Act applies to rules under this section as it applies to rules under that Act.
(2K) Rules under this section may contain such incidental, supplemental, transitional or transitory provisions or savings as the Society considers necessary or expedient.”
(6) For subsection (3) substitute—
“(3) Despite section 24(2) of the 1974 Act, section 20 of that Act (prohibition on unqualified person acting as solicitor) does not apply to a recognised body; and nothing in section 24(1) of that Act applies in relation to such a body.”
(7) Omit subsection (4).
(8) In subsection (5) omit “corporate”.
(9) In subsection (7)—
(a) for “Secretary of State” (in both places) substitute “Lord Chancellor”, and
(b) for “the commencement of this section” substitute “or in the same session as the Legal Services Act 2007 was passed”.
(10) In subsection (8)—
(a) after the definition of “the 1974 Act” insert—
““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);”,
(b) for ““the Council” and “the Society” have” substitute ““the Society” has”,
(c) after the definition of “the Society” insert—
““legally qualified” and “legal services body” have the meaning given by section 9A;
“manager”, in relation to a body, has the same meaning as in the Legal Services Act 2007 (see section 207 of that Act);”,
(d) omit the definition of “officer”,
(e) in the definition of “recognised body” omit “corporate”, and
(f) after the definition of “registered European lawyer” insert—
““solicitor services” means professional services such as are provided by individuals practising as solicitors or lawyers of other jurisdictions;
and a person has an interest in a body if the person 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).”
(11) Omit subsection (9).
82 After that section insert—
(1) For the purposes of section 9, a “legal services body” means a body (corporate or unincorporate) in respect of which —
(a) the management and control condition, and
(b) the relevant lawyer condition,
are satisfied.
(2) The management and control condition is satisfied if—
(a) at least 75% of the body’s managers are legally qualified,
(b) the proportion of shares in the body held by persons who are legally qualified is at least 75%,
(c) the proportion of voting rights in the body which persons who are legally qualified are entitled to exercise, or control the exercise of, is at least 75%,
(d) all the persons with an interest in the body who are not legally qualified are managers of the body, and
(e) all the managers of the body who are not legally qualified are individuals approved by the Society as suitable to be managers of a recognised body.
(3) The Society may by rules under section 9 provide that, in relation to specified kinds of bodies, subsection (2) applies as if the references to 75% were to such greater percentage as may be specified (and different percentages may be specified for different kinds of bodies).
(4) The relevant lawyer condition is satisfied in relation to a body if at least one manager of the body is—
(a) a solicitor,
(b) a registered European lawyer, or
(c) a qualifying body.
(5) For that purpose a qualifying body is a body in respect of which—
(a) the management and control condition would be satisfied if the references in subsection (2) to persons who are legally qualified were to persons who are legally qualified by virtue of subsection (6)(a) to (c),
(b) the relevant lawyer condition is satisfied by virtue of subsection (4)(a) or (b), and
(c) the services condition is satisfied.
(6) For the purposes of this section the following are legally qualified—
(a) an authorised person who is an individual;
(b) a registered foreign lawyer (within the meaning of section 89 of the Courts and Legal Services Act 1990 (c. 41));
(c) a person entitled to pursue professional activities under a professional title to which the Directive applies in a state to which the Directive applies (other than the title of barrister or solicitor in England and Wales);
(d) an authorised person which is a body in respect of which—
(i) the services condition is satisfied, and
(ii) the management and control condition would be satisfied if the references in subsection (2) to persons who are legally qualified were to persons who are legally qualified by virtue of paragraphs (a) to (c);
(e) a body which provides professional services such as are provided by individuals who are authorised persons or lawyers of other jurisdictions, and in respect of which the management and control condition would be satisfied if the references in subsection (2) to persons who are legally qualified were to persons who are legally qualified by virtue of paragraphs (a) to (c).
(7) For the purposes of this section, the services condition is satisfied in relation to a body if the body provides only services which may be provided by a recognised body (having regard to rules under section 9(1A) and (1C)).
(8) For the purposes of this section—
“authorised person” has the same meaning as in section 9;
“the Directive” means Directive 98/5/EC of the European Parliament and the Council, to facilitate practice of the profession of lawyer on a permanent basis in a Member State other than that in which the qualification was obtained;
“manager”, in relation to a body, has the meaning given by section 9;
“recognised body” has the same meaning as in section 9;
“registered European lawyer” has the same meaning as in section 9;
“shares” has the same meaning as for the purposes of Part 5 of the Legal Services Act 2007 (see sections 72 and 109 of that Act);
“specified” means specified in rules made by the Society;
and a person has an interest in a body if the person has an interest in the body for the purposes of section 9.”
83 (1) Section 10 (penalty for pretending to be a body recognised under section 9) is amended as follows.
(2) In subsection (1) omit “corporate” (in both places).
(3) In subsection (2) omit “corporate”.
(4) For subsection (3) substitute—
“(3) Where an offence under this section committed by a body corporate is proved to have been committed with the consent or connivance of or to be attributable to any neglect on the part of an officer of the body corporate, that officer (as well as the body corporate) is guilty of the offence and is liable to be proceeded against and punished accordingly.
(4) Where the affairs of a body corporate are managed by its members, subsection (3) applies in relation to the acts and defaults of a member in connection with the member’s functions of management as it applies to an officer of the body corporate.
(5) Proceedings for an offence under this section alleged to have been committed by an unincorporated body are to be brought in the name of that body (and not in that of any of its members) and, for the purposes of any such proceedings, any rules of court relating to the service of documents have effect as if that body were a corporation.
(6) A fine imposed on an unincorporated body on its conviction of an offence under this section is to be paid out of the funds of that body.
(7) If an unincorporated body is charged with an offence under this section, section 33 of the Criminal Justice Act 1925 (c. 86) and Schedule 3 to the Magistrates' Courts Act 1980 (c. 43) (procedure on charge of an offence against a corporation) have effect in like manner as in the case of a corporation so charged.
(8) Where an offence under this section committed by an unincorporated body (other than a partnership) is proved to have been committed with the consent or connivance of, or to be attributable to any neglect on the part of, any officer of the body or any member of its governing body, that officer or member as well as the unincorporated body is guilty of the offence and liable to be proceeded against and punished accordingly.
(9) Where an offence under this section committed by a partnership is proved to have been committed with the consent or connivance of, or to be attributable to any neglect on the part of, a partner, that partner as well as the partnership is guilty of the offence and liable to be proceeded against and punished accordingly.
(10) In this section “officer”, in relation to a body corporate, means—
(a) any director, secretary or other similar officer of the body corporate, or
(b) any person who was purporting to act in any such capacity.”
84 (1) Section 43 (jurisdiction and powers of Solicitors Disciplinary Tribunal in relation to complaints against solicitors) is amended as follows.
(2) In subsection (2)(a) for “(7) to” substitute “(9) to”.
(3) After subsection (3) insert—
“(3A) Nothing in section 157 of the Legal Services Act 2007 (approved regulators not to make provision for redress) prevents an order being made under subsection (3).”
(4) For subsection (5) substitute—
“(5) An appeal under section 49 of the Solicitors Act 1974 against an order of the Tribunal under subsection (3) lies only at the instance of the solicitor with respect to whom the legal aid complaint was made.”
85 In the title of Schedule 2, for “Incorporated practices” substitute “Legal services practices”.
86 In paragraph 1 of that Schedule (interpretation)—
(a) in sub-paragraph (1) omit “corporate”,
(b) in sub-paragraph (2) omit—
(i) paragraph (b) and the “or” immediately preceding it,
(ii) “corporate”, and
(iii) “or application”,
(c) after that sub-paragraph insert—
“(2A) References in this Schedule to a manager or employee of a recognised body, 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.”,
(d) omit sub-paragraph (3),
(e) in sub-paragraph (4) omit from “; and for those purposes” to the end,
(f) in sub-paragraph (5) for “sub-paragraphs (3) and (4)” substitute “sub-paragraphs (4) and (6)”, and
(g) for sub-paragraph (6) substitute—
“(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.”
87 For paragraph 2 of that Schedule (appeal against refusal of Council to grant recognition) substitute—
2 (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.
(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.
(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), the High Court may—
(a) affirm the decision of the Society,
(b) direct the Society to grant the body 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,
(d) if the Society has recognised the body, 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), the High Court may—
(a) affirm the decision of the Society,
(b) direct that the body’s 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), 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.”
88 For paragraph 3 of that Schedule (accounts rules) substitute—
“3 (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.”
89 In paragraph 4 of that Schedule (interest on clients' money)—
(a) in sub-paragraph (1)—
(i) for “section 33(1)(a)” substitute “section 33(1)”, and
(ii) for the words from “and subject to” to the end substitute “, 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.”, and
(b) omit sub-paragraph (2).
90 After that paragraph insert—
“4ZA 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.”
91 For paragraph 4A of that Schedule (inspection of bank accounts) substitute—
“4A (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.”
92 For paragraph 5 of that Schedule (accountants' reports) substitute—
“5 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.”
93 After that paragraph insert—
“5A 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.”
94 For paragraph 6 of that Schedule (compensation fund) substitute—
“6 (1) Section 36 of the 1974 Act applies in relation to recognised bodies as if for paragraphs (a) and (b) of subsection (1) there were substituted—
“(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;”.
Legal Services Act 2007