AGM report

This year’s AGM of the Society was held earlier than usual, on 18 March – in order, we were told, to enable important practice rules to be passed in time for their intended commencement. At that date some of the issues which had appeared set to spark lively debate – legal aid, regulatory reforms, the OFT – had either dropped off the agenda or had failed to materialise in time.

That did not prevent some points of contention arising, particularly in relation to the “IPS” amendment tabled to the proposed Client Communication Practice Rules: see paragraph below.

ENGAGEMENT LETTERS

A question of conduct

The most vigorous debate centred round the draft Solicitors (Scotland) (Client Communication) Practice Rules. An amendment backed by the Scottish Law Agents Society and moved by its President Ken Swinton, sought to delete the clause stating that breach of the rules (which require a terms of engagement letter for nearly all transactions) may be regarded as professional misconduct, and substitute a reference to inadequate professional service.

Supporters of the amendment argued that failure to send a letter should be a civil and not a criminal matter, that an IPS finding would not attract a disciplinary record, that solicitors would be anxious to comply as they might not otherwise be able to recover their fees, and that the Society’s inspectors had more important things to check for.

For the Council, it was pointed out that in terms of section 34 of the Solicitors (Scotland) Act itself, breach of a practice rule may be treated as misconduct, irrespective of whether this is stated in the rule – the inclusion of the clause was only giving the profession fair notice. The Council had no other way of making the practice mandatory, and only wholesale failure was likely to be treated as misconduct.

The amendment was heavily defeated on a show of hands but easily carried when its supporters exercised their proxies on a poll. It is understood that the Society will put the rules as amended to the Lord President for approval, but with a guidance note in order to draw attention to the position regarding misconduct.

Murray’s glass well filled

“I am by nature an optimist, and my glass has been topped up in abundance this year.” With these words the Society’s President Duncan Murray began his report to the AGM on the Council’s work.

The outcome of the OFT investigation had been a highlight, as had achieving the 90% in nine months complaints handling target and the increased lay participation in the client relation process.

The profession’s record, he maintained, would be put forward as a success story in any other sector – firms in private practice now make a £1 billion contribution to the Scottish economy, with in-house lawyers in the public and private sectors adding to that. Equally worthy of praise is the commitment to corporate social responsibility and pro bono work.

Duncan Murray stressed that the Society achieves a great deal with limited resources. The £1.4 million spent on complaints handling is a fraction, perhaps only a third, of the realistic cost, he said, given the Society’s dependence on voluntary help and the modest remuneration paid to reporters. The Law Reform Department and its committees play an immense and largely unsung role giving evidence to parliamentary committees, particularly with the recent criminal procedure reforms.

It is a concern, however, that fewer solicitors are coming forward to serve on Council, leaving unfilled seats and few contested elections. As a result, he said, more reliance is placed on the “increasingly hard pressed” executive staff. The Society will recruit more staff, “but we must have a blend of practitioners and staff”.

Commenting on the “vast quantity” of legislation emanating from the Scottish Parliament, the President said that while he was in favour of the Parliament it must be wary of rushing in where the marketplace or the common law can and does provide a solution.

Anticipating the Executive consultations on legal aid and the future regulation of the profession, he hoped that improved regulatory arrangements could be put in place for the benefit of the profession and the public.

Finances run to budget

The Society’s finances are in good shape, the treasurer, Ruthven Gemmell, reported to the meeting. A trading surplus of £171,000 was in line with projections and reserves are now over £1,000,000. The current year’s budget includes a similar surplus, but part of this represents a contingency for possible further resources for the Client Relations Office. A scheduled actuarial review of the Society’s pension scheme may also have an impact.

John Hamilton, presenting the Guarantee Fund accounts, told the meeting that grants made totalled £187,000 compared with £73,000 the year before, but this was an improvement on the previous estimate of £200-250,000. Although it was early in the year for current estimates, this year might see payments in the £120-170,000 range.

Rules go through

The draft Client Relations Partner Practice Rules were passed by a large majority. While a few members present questioned the need for the rules, Andrew Glencross for the Council pointed out that they implement a commitment given to the Scottish Parliament and Executive, and reflect the Society’s philosophy of encouraging voluntary conciliation. Seventy per cent of practice units already have a client relations partner, but some complainers still have a problem about who to turn to.

The other draft rules, to support the regulation of multinational practices and the registration of foreign lawyers wishing to enter into such practices with Scottish solicitors, were approved without opposition.

Another look at CPD

As can be seen on page 9 of this issue, John Elliot and Ewan Malcolm argued for a review of the CPD system. Their motion was passed: as a result the Society will “review the operation of the Continuing Professional Development Scheme with a view to determining its effectiveness in maintaining and increasing the competence of solicitors and... report to the Annual General Meeting of the Society in 2006 on that review with proposals for change, if any” (Council accepting the motion with the addition of the last two words). Morris Anderson for the Council said that the CPD scheme is kept under regular review and from 2006 there will be a system of self-certification rather than the keeping of record cards.