Miller: Law Society will have to change its guidance
The Court of Appeal has made amendments to its Mazur ruling to make clear that law firms are not at risk of committing a criminal offence through inadequate supervision of unauthorised persons.
We reported yesterday that the Law Society had decided not to appeal [1] last month’s decision but we were wrong to declare that the drama was over.
It has now emerged that earlier this week it sought a declaration from the Court of Appeal on its description of how the decision should be interpreted.
This followed publication last week of the Law Society’s updated guidance [2] on the conduct of litigation.
As explained today in an article for Legal Futures [3] by Iain Miller, who represented CILEX pro bono in successfully bringing the appeal, the issue concerned the section of the guidance on the consequences of breach.
The Legal Services Act 2007 makes it a criminal offence to carry on the conduct of litigation by a person not entitled to do so or, even if authorised, through an employee or manager who is not.
The guidance quoted the comments of Lady Justice Andrew in Mazur, who said that if the litigation “is not being conducted by the unauthorised person for and on behalf of the authorised individual, they will be committing an offence”.
The guidance went on: “This means that the non-authorised individual themselves and/or their employer/firm may be liable where: there is no authorised individual involved at all in the tasks, these have not been appropriately delegated and supervised, or the non-authorised individual has acted outside the scope of their delegated authority.
“Breach could result in imprisonment or a fine, or both. This may also amount to contempt of court.”
According to Mr Miller, early this week the Law Society sought a declaration from the Court of Appeal which would affirm this interpretation of the judgment, “meaning that, in effect, a firm or solicitor could commit the criminal offence of carrying on the conduct of litigation by not having adequate supervision”.
He said he and many of the other parties disagreed and considered the Law Society’s guidance wrong in so far as it sought to conflate adequate supervision with the criminal offence.
Mr Miller continued: “Throughout the hearing, the Court of Appeal had been keen to avoid circumstances such as those the Law Society was now presenting as a consequence of the judgment, whereby satellite litigation may arise on the question of whether, for example, the supervision of a paralegal was ‘adequate’ with reference to regulatory rules and guidance.
“On 22 April, the Court of Appeal confirmed that it also disagreed with the analysis presented by the Law Society. It has now made small changes to the judgment to remove any ambiguity.”
The general editor of the textbook Cordery on Legal Services, Mr Miller pointed out that supervision was “classically a matter for the regulators, not the courts”, meaning it would be “odd” if the court intended that the effectiveness of supervision was determinative either in a criminal prosecution or a costs challenge.
“No doubt the Law Society will now need to amend its guidance,” he concluded.
We have approached the Law Society for comment.