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COLPs and COFAs : a nervous wait

With the COLP and COFA approval process operating under the usual veil of SRA mystery, firms may start to get a little edgy as Susanna Heley explains

With Christmas just around the corner, many firms will be fervently praying that Father Christmas delivers timely approval for their COLPs and COFAs this year. From the SRA’s perspective, those firms still in the dark as to the fate of their nominees should take heart from Samantha Barass’ public assertion that “No news is good news” at this stage.

We are told that around 400 firms have failed to make any nominations for COLPs and COFAs in breach of the SRA’s requirements. Those firms who have failed to engage with the SRA to fix the problem can expect the onset of disciplinary investigations for Christmas; those COLPs and COFAs who have failed to disclose relevant disciplinary histories to the SRA are also likely to face disciplinary investigations and may well have difficulty in persuading the SRA that approval should be granted at all. Failure to disclose material facts to the SRA is treated as prima facie evidence of dishonesty which can be difficult to rebut.

According to the SRA, it has received an excessive number of applications which fail to disclose relevant disciplinary findings against the applicants. It will be interesting to see whether the SRA chooses to pursue 
the individual nominated or the applicant firm since, strictly speaking, it is the firm’s responsibility to obtain all relevant information and the applicant only has to attest to its accuracy.

Right of appeal?

It is fairly easy to condemn the actions of firms who have apparently taken no steps at all to address the issue of COLPs and COFAs. It is probably quite likely that some of these firms are phantoms – firms which are defunct but have lingered on the SRA’s systems. The issues become more difficult when you start looking at those firms which have made applications and – perhaps inadvertently – omitted disclosable details. There could be any number of explanations for such omissions and no doubt, these will be put to the SRA in due course in one form or another. Sadly though, it is unlikely that the SRA will be forgiving of even inadvertent non-disclosure save in the most 
innocent circumstances.

The level of distrust generated by failure to disclose will be difficult to overcome for both firm and applicant.
The most interesting – and potentially frightening – issue arising out of the new COLP/COFA requirements is that every firm is reliant on the SRA’s approval of a person to fulfil these roles. The ability of even the largest firms in the land to continue to practice lawfully is dependent on having approved COLPs and COFAs at all times. Unfortunately, traditional firms are not given the same treatment as ABS firms under the Authorisation Rules. For example, there is no requirement for the SRA to approve or reject a COLP/COFA candidate within a specified timeframe. Nor is there any deeming provision which allows a firm to appeal against the lack of any decision within a certain period. Finally – and most alarmingly – I can find no external right of appeal, either to the SDT or the High Court, against the SRA’s decision to reject an application for approval of a COLP/COFA in a traditional firm. I have to assume that this was not intentional since ABS firms have the right to appeal both the lack of a decision and an adverse decision relating to COLPs and COFAs to the SDT (provided that the firm or the applicant has gone through the SRA’s internal procedure first).

Limited pool

Objectively, there can be no reason for this differential treatment. All firms are at risk of losing their authorisation to practice if they do not have an approved person in the roles. While the SRA’s decision will be amenable to judicial review, this is not always an appropriate vehicle for challenging a decision of the SRA because it doesn’t allow for the full gamut of arguments which the court could consider in the context of a statutory appeal.

Sole practitioners and those small firms with a very limited pool of candidates for the roles are those most at risk of having to cease practice if those candidates have an adverse disciplinary history or a finding by any court or tribunal of discrimination.
For now, those firms with safely approved COLPs and COFAs can sit back and relax – at least until those individuals wish to step down from the role. hose firms who have heard nothing from the SRA, in my view, need to seek written assurance that they can rely on the applications they have made. Those who have already been told that their chosen COLPs and/or COFAs may not be suitable need to consider their position very carefully. The consequences of not obtaining approval are potentially catastrophic.

Susanna Heley

This article was first published by Solicitors Journal and is reproduced by kind permission.


This briefing is for guidance purposes only. RadcliffesLeBrasseur LLP accepts no responsibility or liability whatsoever for any action taken or not taken in relation to this note and recommends that appropriate legal advice be taken having regard to a client's own particular circumstances.

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