Legal Services Bill [HL]

moved Amendment No. 149ZB: 149ZB:Schedule 16 , page 221, line 2, leave out from ““certificate”” to end of line 8 and insert ““if he has been required by rules made under section 34(1) to provide an accountant’s report and has failed to provide such a report within the time period prescribed under those rules,”” The noble Lord said: Your Lordships will not have failed to observe that there are rather a large number of amendments in this group. They contain technical amendments to Schedule 16 and a certain amount of patience will be required from all of us. Amendment No. 149ZB would remove the unnecessary reference to a practising certificate free of conditions. The obligation to pay an additional fee should arise simply if the solicitor is in default with his obligation under the Section 34 rules to provide an accountant’s report. Amendments Nos. 149ZC and 149ZD amend what appears to have been a drafting omission. There will be two appeals jurisdictions under both new Section 13 and Section 13A of the Solicitors Act. Therefore, just as will be the case in the new Section 13, the provision stating that the High Court’s decision shall be final should apply to both appeals jurisdictions under Section 13A and not just one of them. Amendment No. 149ZG is aimed merely to extend the new accounts rule power under Section 32(1)(aa) of the Solicitors Act, which will cover the operation by a solicitor of an account belonging to his or her client which remains in the client’s name. The amendment would include cases where the client’s account is with a financial institution other than a bank or building society, which happens not uncommonly. Amendment No. 149ZH removes an anomalous function; namely, the Law Society’s function of certifying deposit interest certificates. This is rendered inappropriate by Clause 154 of this Bill, which stipulates that the regulatory arrangements of an approved regulator can contain no provision as to redress. Amendments Nos. 149ZJ, 149ZK and 149ZL all update the accounts rules in the Solicitors Act as it will be amended. Amendments Nos. 150D and 150J also rectify a simple omission in the drafting that did not reflect the extension of the accounts rules to cover amounts with building societies as well as banks. Amendments Nos. 150XA, 150XB and 150CA would remove the prohibition on solicitors limiting liability for negligence in contentious business agreements. Where there is a dispute between a solicitor and client about the solicitor’s bill, the matter is normally subject to assessment by the court. However, solicitors and clients can—if they so choose—enter into a ““contentious business agreement”” under which all the terms of business are agreed at the outset and there is no right to assessment in the event of a disagreement. The current provisions on contentious business agreements provide what appears to be a prohibition on any restriction of liability for negligence. In our submission, this impedes the use of such agreements in commercial cases where solicitors may well wish to agree with their commercial clients a limitation of the solicitor’s liability, often linked to the availability of appropriate top-up insurance. Removal of this prohibition would not adversely affect the interests of the consumers because of existing professional rules and consumer protection legislation. Amendments Nos. 150XC and 150CB are intended to make it possible for solicitors to take action on bills sent to clients electronically, rather than there being a requirement that a bill should be signed physically. The provisions are necessary in order to comply with this country’s obligations under the EU directive on electronic commerce. Most commercial clients actively prefer to receive electronic, rather than paper, bills. Under these amendments, solicitors will only be able to sue on bills sent electronically where the client has provided them with an e-mail address specifically for that purpose and the provision does not apply if the client has indicated that he or she is not willing to accept delivery of a bill sent by e-mail or by fax. This is therefore a modest, but desirable, improvement of provisions relating to solicitors’ billing which date to 1974 and therefore understandably do not take into account the use of electronic communication. Amendment No. 150ZZA relates to the matter of delegation. Unless the Law Society has an adequate delegation power, it will not be able to achieve either a proper separation of its representational and regulatory function or a sufficiently effective exercise of its regulatory functions. This amendment therefore makes several necessary changes to achieve that. Most importantly, it would allow the delegator to direct that the delegated function may not be delegated any further. The other amendments in this group refer to foreign lawyers. Amendment No. 150M removes a serious loophole in the current regulatory structure where there is no power to impose conditions on the registration of a foreign lawyer, except at the annual point of registration. As with all other solicitors, there should be a power to impose such conditions during the currency of the registration. Finally, Amendment No. 150MA opens up the register of foreign lawyers to public inspection—that is not currently provided for in the legislation. I beg to move.