A heavier burden: certificates of compliance

A new practice direction exposes solicitors to a number of regulatory pitfalls, says Susanna Heley

The introduction of practice direction 57AC (PD57AC) from 6 April 2021 has been the subject of much discussion amongst litigators.

The new obligations on legal representatives (note the term) to certify that relevant trial witness statements have been discussed and prepared in accordance with PD57AC are novel and present a number of interesting issues from a regulatory perspective.

For those not in the know, PD57AC requires witness statements signed on or after 6 April, for use at trial in affected cases in the business and property courts, to be prepared in accordance with express requirements and to carry declarations from both witness and legal representative as to compliance.

The requirements are not, in themselves, all that dramatic. They attempt to limit ‘over lawyering’ of witness statements by reinforcing that the purpose of trial witness statements is for witnesses of fact to give their best relevant evidence as to their recollections of what they have seen and heard with their own five senses.

Such evidence is, naturally, to be in their own words and must include a list of documents the witness has referred to or been referred to for the purposes of preparing the statement.

In litigation terms, one can understand the intent behind PD57AC, even while cynically expecting a raft of satellite litigation and technical arguments as to compliance.

Declaration

For regulatory purposes, the points that firms and compliance teams will want to watch out for are the consequences of signing the required legal representative declaration. All legal representatives will be required to certify relevant statements in the following terms:

“I hereby certify that:

1.I am the relevant legal representative within the meaning of Practice Direction 57AC.

2.I am satisfied that the purpose and proper content of trial witness statements, and proper practice in relation to their preparation, including the witness confirmation required by paragraph 4.1 of Practice Direction 57AC, have been discussed with and explained to [name of witness].

3.I believe this trial witness statement complies with Practice Direction 57AC and paragraphs 18.1 and 18.2 of Practice Direction 32, and that it has been prepared in accordance with the Statement of Best Practice contained in the Appendix to Practice Direction 57AC.”

 In signing such a declaration, solicitors are representing to the court that they have personal knowledge of how a statement has been prepared.

That is an obligation which will need to be taken seriously. Firms and supervisors will need to be able to demonstrate that they have taken steps to ensure that employees understand the nature and effect of the obligation, which will include ensuring a proper understanding of the substantive requirements of PD57AC.

Some of the requirements set out in the Statement of Best Practice are not all that easy for solicitors to police – such as specific requirements as to documents which may be used by a witness to refresh memory.

One may wonder how a solicitor is supposed to identify documents which a witness would have seen at the time their memory was fresh, such that it is permissible to show the document to a witness when preparing their statement.

Misconduct

Regular readers of Solicitors Regulation Authority (SRA) and Solicitors Disciplinary Tribunal (SDT) regulatory decisions will be aware that signing statements of truth is relatively fertile ground for allegations of misconduct.

There have been numerous examples of solicitors facing allegations of signing statements of truth without a proper belief in their truth. Dishonesty and/or recklessness is often alleged in the context of such proceedings.

The potential regulatory effect of PD57AC is worthy of reflection. Among other things, if they are to certify compliance with PD57AC, solicitors will have to take reasonable steps to check that the witness statement contains only relevant acts which need to be proved at trial (as per paragraph 3.2), but does not omit anything of significance (per appendix paragraph 3.3).

These are fairly subjective issues, on which the PD makes clear that many facts will not require witness testimony where it adds nothing of substance to the documentary evidence.

Privilege

Another issue which may require regulatory consideration is the extent to which privilege may become an issue in connection with the preparation of compliant witness statements.

While it appears that there is no intention in PD57AC to override privilege (which would arguably require primary legislation in any event), there are numerous potential requirements which could trigger at least a wish to rely upon privileged material in the event of a challenge to the process of preparing a statement.

For example, paragraph 3.10 of the appendix to PD57AC provides that witness statements should, where practicable, be based on a record or notes made by a legal representative, taken during an interview where possible.

According to paragraph 3.11, such interview should avoid leading questions; use open questions; and be recorded as fully and accurately as possible by contemporaneous note or other durable record dated and retained by the legal representative.

It should be readily apparent that such a note would be highly relevant to any dispute as to the basis of a solicitor’s certification of compliance. The note, of course, is likely to be privileged and the privilege belongs to the client. The scope for conflicts and compliance arguments arising out of these issues is plainly present.

It will doubtless take some time for the changes to embed; and PD57AC will inevitably develop and be refined as experience reveals problems alongside improvements.

In the interim, firms and their compliance teams will need to keep a close eye on developments and implement training so that fee earners understand that there may be circumstances where they should refuse to sign a certificate of compliance.

It seems likely that the consequences of refusing to sign such a certificate could lead to a conflict of interest which may prevent a firm from continuing to act. It may be that the court will be willing to make directions to resolve an issue which comes down to interpretation of a particular element of the rules; or an issue which is one of technical non-compliance with no material impact on the actual evidence.

One issue which does need to be considered is the potential situation where a witness is interviewed early by a fee earner who takes a proof of evidence in compliance with PD57AC – but is then transferred or in some other way prevented from being part of the team when statements are signed.

What steps should a successor fee earner take to ensure that they are confident in signing a certificate of compliance?

It will be interesting to see how firms and the SRA respond to potential issues arising as a result of the changes. I suspect that there will be a number of skirmishes where certificates of compliance are challenged and even reported to the SRA.

No doubt some preparing statements will get it wrong and be asked by the court or the SRA to account for what happens.

In the meantime, ensuring that your training is appropriate; that you have proper supervision in place; and that you are clear on who may sign certificates of compliance and in what circumstance are all helpful steps to avoid potential pitfalls.

Susanna Heley is a partner at RadcliffesLeBrasseur rlb-law.com