Meeting of the Parliament 26 April 2018
I refer members to my entry in the register of interests. Members will note that I am a member of the Law Society of Scotland and that I hold a current practising certificate, albeit that I am not currently practising.
Amendment 34, in the name of Margaret Mitchell, would include in the bill certain requirements for a success fee agreement to be enforceable. I ask members not to agree to the amendment, as it would undermine the principle of an independently regulated legal profession. The provisions in the amendment are also unnecessary—I will deal with that in a moment.
Turning to the first point, the amendment would mean that substantial provisions about solicitors’ professional obligations would be fixed in primary legislation rather than in Law Society rules, which, aside from any other consideration, are much more flexible when it comes to updating and so forth. The amendment therefore appears to strike at the heart of an independent Law Society and does not take account of the principle that professional rules are best made by a professional body.
Sheriff Principal Taylor has commented that he believes that the second part of the amendment in particular is impractical. As Daniel Johnson mentioned, a number of cases still settle at the eleventh hour and at the door of the court. Sheriff Principal Taylor believes that paragraphs (b)(i) and (b)(ii) of the amendment would be difficult to comply with, and points out that a solicitor is already under an obligation to comply with the provisions in paragraphs (b)(iii) and (b)(iv), which the amendment would require to be certified. If the provisions are inserted into primary legislation, there is also a question of who will be responsible for regulating them. As it stands, it is not clear from the amendment that the Law Society would have that responsibility, so that is a matter of uncertainty.
It is a fundamental principle of maintaining an independent legal profession that no state interference or influence is exerted. The Scottish Government is committed to the principle of an independent profession, and I ask the Parliament to support that principle. It is well known that, as I said, Scottish solicitors are already required to act in the best interests of their clients at all times and must ensure that their clients understand fee arrangements and give informed consent.
Success fee agreements are not new; indeed, they have been in place in some form since the 1990s, and any theoretical conflicts and other issues have not prevented speculative fee agreements from being rolled out since that time. Where the provider of relevant services is a claims management company, it will of course fall under the regulation of the Financial Conduct Authority.
The Law Society has set up a working party that is considering success fee agreements, what provision should be made in Law Society rules and guidance to govern their terms and any other relevant issues. I understand the motivation behind Margaret Mitchell’s amendment 43, and I undertake to write to the Law Society to draw its attention to the points that the amendment raises. The Scottish Government will of course work with the Law Society as the bill is implemented to seek to ensure that the provisions relating to success fees are implemented in a way that best gives effect to the principles of the bill.
In summary, amendment 34 provides for matters that should not be set out in primary legislation, that risk undermining the principle of an independently regulated legal profession and that are more appropriately handled in rules and guidance that are provided by the Law Society of Scotland in its capacity as regulator of solicitors. Hence, I ask Margaret Mitchell to consider withdrawing amendment 34.