SDT: Defending proceedings
A decision to refer a solicitor (or regulated entity) to the Solicitors Disciplinary Tribunal (SDT) can be made by a senior employee of the Solicitors Regulation Authority (SRA) or an adjudicator.
Until 2012, most referrals were made by adjudicators, who made a decision after reading a case report prepared by the SRA setting out the details of the complaint. Over the past few years the SRA has increasingly relied on delegated powers which permit senior employees to make referral decisions.
Rule 10 of the SRA Disciplinary Procedure Rules 2011 states that, in order to make a referral to the SDT, the SRA must be satisfied that:
- There is sufficient evidence to provide a realistic prospect of success
- The allegation is sufficiently serious to warrant a sanction which the SRA does not have power to impose, and
- It is in the public interest to make the referral
The SRA has the power to impose fines of up to £2,000 on solicitors. In practice, an allegation against a solicitor will not be referred to the SDT unless the SRA believes that the Tribunal will impose a fine exceeding £2,000.
The position is different with an ABS. The SRA has the power to impose a fine of up to £250 million on a licensed body and a fine of up to £50 million on managers and employees of a licensed body. As a result most complaints against a licensed body will be dealt with at first instance internally by the SRA rather than externally by an independent tribunal.
Challenging a decision to refer a solicitor to the SDT
In practice, it is difficult to challenge a decision to refer a complaint to the SDT. There is no right of internal appeal under the SRA Disciplinary Rules 2011, and there is no statutory right of appeal to the High Court.
The decision is in theory subject to judicial review, but an application to the Administrative Court for permission to apply for judicial review is almost bound to fail because the court will hold that the SRA’s decision to refer is not a final decision on the underlying complaint.
In the absence of an effective right to challenge the decision to refer, the case will proceed to the Tribunal unless it is possible to persuade the SRA to change its mind. We are often asked by clients to approach the SRA at this stage of a case to negotiate and after discussions the SRA will at times agree to rescind the referral and, for example, enter into a regulatory settlement agreement. If your case has reached this stage and you would like us to negotiate on your behalf please get in touch.
Issue of proceedings in the SDT
It normally takes the SRA between three and six months to issue proceedings after a decision has been made to refer a complaint to the SDT.
The proceedings are issued by delivering to the SDT an originating application (Form 4), a statement setting out the allegations and the background facts (a Rule 5 statement) and the exhibits to the Rule 5 statement.
The application is considered by a chairman of the Tribunal, who certifies whether or not there is a prima facie case to answer. Once the certification is given, the application is passed to the clerk to the Tribunal for service on the respondent.
Publication of SDT proceedings on the SRA’s website
The SRA’s policy statement of April 2012 headed ‘The publication of regulatory and disciplinary decisions’ states that referrals to the SDT may be published once a chairman of the Tribunal has certified that there is a prima facie case.
The publication policy states that the factors which support a decision to publish include the importance of transparency, the need to maintain public confidence in the provision of legal services by demonstrating that regulatory action is being taken and the importance of providing prospective clients with information about regulatory action so that they can make informed choices about whom to instruct.
The publication policy lists some factors which might support a decision to publish. Those factors include circumstances in which there is an inability to publish without disclosing privileged or confidential information and circumstances in which publication leads to a breach of a person’s right to privacy under Article 8 of the convention rights.
In practice the SRA normally makes a decision to publish the referral. However a respondent is always given an opportunity to make representations before the SRA reaches its decision and clients are often well advised to make representations. A decision to publish can have a damaging effect on a business because the SRA’s website has a high search rating and a solicitor with a good defence to a complaint can face the soul-destroying prospect of losing business by adverse publicity before he or she has had a fair opportunity to answer the allegations.
If you would like us to advise you on the type of representations to make please contact one of our lawyers specialising in solicitors regulatory work.
The rules governing Tribunal proceedings are the Solicitors (Disciplinary Proceedings) Rules 2007. The rules can be found on the SDT’s website.
Service of SDT proceedings
The clerk to the Tribunal will serve on the respondent the originating application, the Rule 5 statement and exhibits, a copy of the Solicitors (Disciplinary Proceedings) Rules 2007, a standard form of directions and a number of other documents.
The documents are normally served by sending them to the solicitor’s office by post.
If we are acting for a solicitor, we can make arrangements to accept service of the papers on behalf of our client if our client wishes to avoid the embarrassment of SDT proceedings being sent to his or her office, and possibly opened by a junior member of staff.
Directions, case management conferences and mentions
The standard form of directions accompanying the papers served on the respondent will give standard directions for the procedural steps required to take the case to trial and either
- Specify a date for a case management conference, or
- Specify a date for the substantive hearing (or trial).
In practice, a case management conference is only fixed if the SRA states when issuing the proceedings that the time estimate for the trial is over one day.
A respondent receiving notice of a date for the substantive hearing should contact the listing manager at the Tribunal promptly if the respondent cannot attend on the fixed date.
Respondents should consider whether they need to make any interim applications for, for example, further information to clarify the SRA’s case, disclosure of documents or directions on expert evidence.
The Tribunal’s standard directions include a direction requiring the respondent to serve a response stating which of the allegations are admitted and which denied and, in the case of those which are denied, why they are denied.
It is a matter for the respondent to decide what form the response should take. Some respondents serve formal pleadings. We often decide after carefully considering a case that it’s better for some of our clients to serve a witness statement rather than a formal pleading.
Preparations for trial
It is a common mistake in Tribunal proceedings to assume that nothing much needs to be done between service of the response and the date of the hearing. Respondents should carefully consider during this period whether, for example, there are witnesses who can assist, documents to locate and serve or referees to approach.
Respondents should also consider whether it is appropriate to hold discussions with the SRA to try to reduce the scope of the SRA’s complaints. We often find that the SRA is willing to listen to our representations on the scope of a client’s case and withdraw doubtful allegations.
Respondents should consider whether to prepare evidence on their means. The Tribunal will take account of a respondent’s financial position when deciding what order to make on costs. If a respondent facing difficult financial circumstances serves a witness statement verifying those circumstances, the Tribunal may well be prepared to make a direction that any order for costs should not be enforced without leave of the Tribunal.
The substantive hearing
All of the hearings take place on the third floor of the SDT’s address at Gate House 1, Farringdon Street, London EC4M.
The hearings are normally listed to start at 10am. There could be a waiting period if there are other cases in the list and if they are heard first.
Three members of the Tribunal will hear the case. Two of those members will be solicitors and the third member will be a lay person. One of the two solicitor members will act as the chairman.
At the end of the hearing, the chairman will announce the Tribunal’s decision, impose a sanction (unless the case is dismissed) and make an order for costs. The normal range of sanctions, in order of severity, are reprimands, fines, suspensions and strike offs.
The Tribunal’s written reasons for the decision, which are known as findings, are prepared after the hearing. It normally takes the Tribunal about six weeks to prepare the findings, but it can take longer if the case has lasted more than one or two days. Once prepared, the findings are served on the parties and filed at the SRA. The findings are also published on the Tribunal’s website.
Orders for costs in SDT proceedings
The Tribunal normally makes an order for the respondent to pay the SRA’s costs, and the order for costs can include an order that the respondent pays the SRA’s investigation costs.
In recent years, the amount claimed by the SRA for costs has increased dramatically. Today, respondents often find that the amount claimed by the SRA for costs far exceeds the amount of the fines imposed by the Tribunal.
It is therefore important for an impecunious respondent to apply for an order that the costs order should not be enforced without the permission of the Tribunal, and (as stated above) the Tribunal will expect such an application to be supported by a witness statement of means.
There is a right of appeal against a final order of the Tribunal to the High Court. Permission is not needed to appeal and the appellant’s notice must be filed within 21 days of receipt of the findings. The appeal takes place in the Administrative Court.
In practice, the grounds of appeal must be considered carefully as case law recognises that the Tribunal comprises an expert panel and the courts are slow to interfere with decisions of the Tribunal.