Jan 22 2009

Changes to the Faculty’s Professional Conduct Guide

In October 2008, the Faculty of Advocates issued a revised, fifth, edition of the Guide to the Professional Conduct of Advocates. The differences from the fourth edition, which was published in 2007, are fairly slight (the abolition of the mixed doubles rule does not feature here, the rule having been both made and abolished by the simple device of a Dean’s ruling). Firstly, there is now an explicit rule banning the payment of commission for the introduction of work. Secondly, rules which had the effect that an advocate might only appear in a court or tribunal, or consult, with a solicitor present have been repealed.

Payment of commission

The new rule, 9.12, reads “Counsel may not enter into arrangements by which a commission or referral fee is paid to any third party as a consideration for referring work, or for recommending or introducing counsel to the client or an instructing agent.” Advocates are already subject to rules of the Council of Bars and Law Societies of Europe (the CCBE) to the same general effect:1, but CCBE rules only apply to cross-border activities.

The reasons why such a rule is necessary are well stated by the CCBE in their Commentary to their Code of Conduct: “This provision reflects the principle that a lawyer should not pay or receive payment purely for the reference of a client, which would risk impairing the client’s free choice of lawyer or the client’s interest in being referred to the best available service“. Payments of this kind may not necessarily be corrupt, but they shade very easily into corruption.

The Law Society of Scotland has long had such a rule2: so has the English Bar3. Until recently, however, this did not seem to be an issue for Scottish advocates. When the now-defunct organisation named ‘Instruct Counsel Limited‘ was operating, however, it became apparent that there was an issue. Instruct Counsel Ltd advertised that it could assist solicitors to instruct counsel with “No extra costs to you or your clients“. This could have been a charity, or a free lunch. Obviously, however, it was neither. The costs were substantial. The client could never get a proper choice of counsel, because very few counsel would touch such an arrangement. Unsurprisingly, it folded. But there does remain a perception that such organisations might again operate. They could not instruct counsel themselves, because only solicitors or direct-access participants can do so, and no such organisation has ever applied for direct direct access rights. What, however, remained possible was for intermediaries to operate by identifying counsel who a solicitor would instruct and pay on an agreement that a commission or backhander would be paid to the intermediary. That is now banned. Anyone idiotic enough to enter such an arrangement should be conscious that professional negligence insurance may not cover the consequences.

Appearing without a solicitor

This change was anticipated in the Faculty’s policy statement on alternative business structures entitled ‘Access to Justice: A Scottish Perspective: A Scottish Solution’4: at page 39 “The Faculty considers that it should adjust its own code of conduct so as to enable members of Faculty to speak to witnesses on the same terms as solicitor-advocates:” at page 40 “The Faculty would intend to address [the rule that a member of Faculty is not able to appear before a court or tribunal on behalf of a client without a solicitor or agent being present] in order that a member of Faculty may be able to determine that in appropriate circumstances he should appear without a solicitor or agent being present“: and in conclusion 5 at page 44: “The Faculty should review its present Code of Professional Conduct in order to allow members of the faculty to speak to witnesses upon the same terms as a solicitor-advocate; and in order to allow members of Faculty to a appear in appropriate cases without a solicitor or agent being present.”

That is what the changes to paragraphs 1.2.3, 4.5 and 4.6, and 6.3.9 do. There is no longer any general rule that an advocate must have a solicitor present in a court or tribunal appearance. Advocates are now permitted to consult with a client without the need for a solicitor being present. There is no longer any general rule that an advocate cannot discuss a case with a potential witness. These changes put advocates on something more like a level footing with solicitor-advocates and English barristers; they reduce costs, in some cases at least; and they make the instruction of advocates more cost-efficient and hence attractive. In practice, the main effect seems likely to be in tribunals; there seems already to be a clear impact in employment and asylum and immigration tribunals.

  1. Code of Conduct for European Lawyers: “5.4.1. A lawyer may not demand or accept from another lawyer or any other person a fee, commission or any other compensation for referring or recommending the lawyer to a client.
    5.4.2. A lawyer may not pay anyone a fee, commission or any other compensation as a consideration for referring a client to him- or herself“. [back]
  2. Solicitors (Scotland) Practice Rules 1991: “4. A solicitor shall not share with any unqualified person any profits or fees or fee derived from any business transacted by the solicitor of a kind which is commonly carried on by solicitors in Scotland in the course of or in connection with their practice…“ [back]
  3. Its Code of Guidance, under the heading ‘Fundamental Principles‘, provides “307. A barrister must not:
    (d) give a commission or present or lend any money for any professional purpose to or (save as a remuneration in accordance with the provisions of this Code) accept any money by way of loan or otherwise from any client or any person entitled to instruct him as an intermediary;
    (e) make any payment (other than a payment for advertising or publicity permitted by this Code or in the case of a self-employed barrister remuneration paid to any clerk or other employee or staff of his chambers) to any person for the purpose of procuring professional instructions, …
    “ [back]
  4. This is here, but only as a massive scanned file; it is fairly summarised here. [back]

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