Putting out fire with gasoline

One year ago a former president of the Law Society, David McIntosh, criticised the SRA's investigation procedures (Solicitors Journal, 152/23, 10 June 2008), saying that they were 'unfairly weighted against the investigated firm, with little or no protection other than a promise of confidentiality'.

Following the Court of Appeal's decision against Michael Napier, another former Law Society president, in which it refused to grant an injunction preventing Private Eye from publishing details of a complaint and disciplinary findings against him, even the small comfort of confidentiality has now been removed as the court held that no duty of confidentiality is owed between the complainant and the solicitor.

For a duty of confidentiality to be owed, it said, the information in question must be of a nature and obtained in circumstances such that any reasonable person in the position of the recipient ought to recognise that it should be treated as confidential. The subject matter here was the conduct of the solicitor in relation to the complainant and while the court did envisage certain cases which might involve information of an intrinsically private nature '“ for instance, details of a solicitor's health - which should be kept confidential, this was not such a case.

New publication policy

So, does this decision come as any surprise? Not really. Since January 2008, the SRA's policy has been to publish certain decisions on its website where it is in the public interest to do so, including decisions to prosecute before the SDT (where the SDT has certified there is a case to answer), practising certificate conditions, interventions and Regulatory Settlement Agreements ('RSAs').

In addition, new powers allowing the SRA to impose rebukes and fines can also now be published. If the reprimand ordered against Michael Napier had been made post January 2008, it would in all probability have been published by the SRA in any event.

Michael Napier's evidence appears to have been that if he had realised that the result of the adjudication imposing the reprimand might be publicised by the complainant, he would have applied for judicial review of the adjudication panel's decision and his main reason for not doing so was to avoid publicity. How ironic given the publicity which this case has now generated.

The court gave an example of a solicitor against whom highly publicised allegations of misconduct were made by an aggrieved client and which were dismissed after investigation by the Law Society. The solicitor or firm may well wish to clear their name by making the result known and they should not be prevented from doing so by a duty of confidentiality. But how many solicitors would actually wish to broadcast such a decision? Many will just be relieved that the investigation is at an end without any sanction being imposed. Publishing a statement that a firm is delighted that the SRA had found in their favour would only bring more attention to the firm and the risk that the public will still think there's no smoke without fire.

The case again resurrects the naming and shaming issue but this, in my view, is here to stay. As the court said: 'The purpose of the scheme is not to protect the reputations of solicitors against whom adverse findings are made. It is to provide a proper means of regulating the profession and maintaining public confidence in it.' Transparency is key.

So what are solicitors now meant to do when faced with a regulatory sanction? Accept the decision and hope that the complainant will not seek to publicise it any more than the SRA publication on its website? Or fight on, appealing the decision to the tribunal or applying for judicial review in the hope that the initial decision will be overturned? None of the options are particularly attractive and each case will have different considerations coming into play.

Cost, time, stress and the potential damage to reputation are all significant factors in deciding whether or not to continue to defend oneself or accept the sanction imposed. Of course, in the more serious cases, some firms may not get the choice if the SRA decides to refer the matter to the SDT, with such a referral also being published. Statistics of decisions from the SDT suggest that there are very few cases before it which are thrown out completely and so if firms are offered an RSA, for example, thus avoiding referral to the SDT, it is worth considering very seriously '“ even though it will be published.

Desperate measures

Solicitors will in all likelihood face the same dilemma when the new complaints regime comes into force next year. The naming and shaming issue was put on hold by the LCS last October, leaving it to the OLC to decide whether to publish findings of inadequate professional service. In this consumer world, publication is likely. The fear is that firms will either seek to buy off the complaint in house no matter how unmeritorious it may be, or will want to fight any decision tooth and nail if it knows it will be published. Either way, the Court of Appeal appears to have cleared the way for aggrieved clients to go to the press and cause further mischief should they wish to do so.

The only safe solution is to be compliant, build strong relationships with clients through excellent client care and thus hopefully avoid the regulator and any prospect of adverse publicity altogether.