The future of conduct, codes, and culpability

The way legal services are provided is beginning to change, raising some fundamental questions about how the conduct of solicitors (and other lawyers) is to be regulated in a changing legal world. As the structures within which lawyers practise become more flexible, so too have the regulatory codes which surround them - outcomes-focused regulation being a key example. But with this new flexibility comes uncertainty. Added to this, each of the regulators in England and Wales produces its own code of conduct, making the overall regime complicated.

The number of legal businesses employing lawyers from the different branches of the profession is likely to increase. A number of different codes could apply to a single conduct issue where, for example, the actions of a barrister employed by a firm of solicitors are in question but individual culpability is still likely to be relevant. And, as lawyers in other jurisdictions become more involved in UK legal business and vice versa, the inter-relationship between international codes of conduct will become ever more significant.

So, how might all this complexity be navigated? An alternative way to understand the regulatory landscape is to see it in terms of overarching principles, rather than individual codes. In reality, the respective codes for lawyers in England and Wales are marked more by their similarities than by their differences, which is perhaps not surprising, given the structure established by the Legal Services Act 2007. In particular, the statutory regulatory objectives and the role of the Legal Services Board have promoted convergence in regulatory codes. Moreover, much of the conduct required of lawyers comes from court decisions and the views of judges grounded in the principles of common law.

Fiduciary duties

A solicitor has a special role as a fiduciary, and this makes up a significant part of their professional duty - not because of their formal status as a solicitor, but rather from the nature of the client relationship in the context of a retainer. This is also from where the concept of conflict of interest derives, as a solicitor owes a duty of undivided loyalty to their client. So, how does a lawyer stay out of trouble?

Culpability and misconduct

The term 'misconduct' is used inconsistently. Solicitors and their firms may breach the Solicitors Accounts Rules without any personal culpability. The Bar Code of Conduct defines misconduct by reference to breaches of rules, provided the breach is serious enough to merit more than an administrative sanction. Even where there is strict responsibility for rule breaches, the concept of culpability is still key to assessing the gravity of an offence and hence the penalty. Misconduct can be used to mean conduct sufficiently culpable to justify an adverse disciplinary finding. In this context, the concept of misconduct works very similarly for both solicitors and barristers. So, what does this shared concept look like?

The most significant judgement as to whether conduct is sufficiently culpable to amount to misconduct is that of the relevant disciplinary tribunal, where the material facts in any two cases are highly unlikely to be identical, meaning tribunal decisions have limited value as precedents. But tribunal decisions are appealed to the courts on a regular basis, and the decision of an expert tribunal is given respect by the courts. The resulting decisions provide authoritative restatements of the underlying principles.

Certainly the starting point for the consideration of misconduct will be the relevant professional rules, codes, and standards. Then, where the answer is less than clear, principles will assist. The Legal Services Act 2007 set regulatory objectives for regulators, including promoting and maintaining adherence
by authorised persons to 'professional principles'. These are: independence and integrity; proper standards of work; the best interests of clients; the duty to the court; and confidentiality.
It is for a lawyer to apply these principles to the particular situation. Sometimes, the answer will be obvious, but sometimes professional judgement will be required. For some types of conduct, careful consideration and seeking advice in advance may be sufficient to avoid misconduct, even if many lawyers would have reached a different conclusion. In these types of cases a tribunal or court will evaluate whether the lawyer addressed the issue and whether his or her decision was one which a reasonable and competent lawyer could have made.

Trying to understand legal services regulation with reference only to the individual codes is to miss an important part of the picture. When it comes to conduct and culpability, an appreciation of the overarching principles is key - not least to keep track of future changes as the regulatory framework evolves to govern the legal businesses of the future. SJ

John Gould is senior partner of Russell-Cooke and author of The Law of Legal Services