The new Solicitors Regulation Authority (“SRA”) Code of Conduct – Precise or Problematic?
6th June, 2016
On 22nd March 2016, the SRA announced plans to reduce the Code of Conduct to a mere 10 pages and the Handbook to around 50. This is part of the 18 month process that the SRA is currently undergoing which is aimed at reducing the regulatory burden that is currently imposed on legal professionals.
As you are aware, the current Code of Conduct is a lot lengthier and is part of the outcome focused regulation which provides us with outcomes we should achieve and behaviours that may or may not help us to achieve them. The move is from detailed values and behaviours to the SRA simply outlining their position.
One area of focus is the rules relating to client accounts. Specifically making it easier for firms to use third party managed accounts. The Law Society has however, opposed any attempt to restrict solicitors from holding client money.
Whilst increased flexibility and the reduction of legal regulation is in one sense a good thing it could also prove problematic. Here at Aaron and Partners we have seen a draft of the proposed new Code of Conduct which is in our view very unspecific. Our concern is that such an unspecific Code is likely to result in dispute with the SRA because of the limited guidance available and a rise in disciplinary actions brought against solicitors for alleged failure to comply with the Code is not unlikely. The new Code is called SRA Code of Conduct for Solicitors, Registered European Lawyers and Registered Foreign Lawyers (2017) and the SRA Code of Conduct for Firms (2017).
The change of rules relating to client accounts could also prove challenging. Whilst the aim to decrease the risks surrounding client accounts may be achieved by using third parties it could also prove more expensive for firms therefore, increasing client fees. In addition, firms and clients alike could face delays if transactions are to be authorised and/ or completed by a third party.
The revised Handbook and Code of Conduct has just been published for consultation at www.sra.org.uk/consultation. We would advise reviewing the Code and taking the opportunity to have your say. In the mean time, remain compliant with the 2011 Code which may serve as useful guidance in the future if the new Code is put into place.
Partner, Professional Practices and Employment
Tel: 01743 453685
Email: [email protected]
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