Fortunately, not all Solicitors Regulation Authority investigations result in formal prosecution and an appearance in the Solicitors Disciplinary Tribunal (SDT). Depending on the circumstances, it may be possible to negotiate a Regulatory Settlement Agreement with the SRA. Similar to attempts to settle civil litigation matters early, all negotiations related to a Regulatory Settlement Agreement are without prejudice.
What is a Regulatory Settlement Agreement?
A Regulatory Settlement Agreement is a formal agreement entered into by the SRA and the solicitor/law firm. It settles the issues/complaint that instigated an SRA investigation. The matter may be settled in whole or in part, and benefits both the solicitor/law firm and SRA by concluding the matter swiftly, cost-effectively, and efficiently, allowing all parties to move forward.
What does a Regulatory Settlement Agreement cover?
A Regulatory Settlement Agreement sets out the SRA principles and/or regulations which have been breached, the actions agreed to be taken to remedy the situation, an agreed sanction and consent to pay the SRA’s costs, and permission to have details of the agreement published by the SRA.
Do I have to admit the breach before I can enter into a Regulatory Settlement Agreement?
Yes, you must admit wrongdoing and be prepared to rectify the matter for a Regulatory Settlement Agreement to be possible.
Are there matters which are not suitable for a Regulatory Settlement Agreement?
The following types of situations are deemed by the SRA as inappropriate for a Regulatory Settlement Agreement:
• The SRA is not convinced that the solicitor/law firm will comply with the agreement. This suspicion could stem from the nature of the misconduct, for example, an element of dishonesty was involved, or the solicitor/law firm has a history of flouting SRA rules and/or sanctions.
• The accusations which have resulted in the SRA investigation are deemed too serious to be settled by agreement and require a formal hearing to ensure public confidence in the legal profession is upheld. An example of this would be a case of serious fraud or manifest incompetence.
• The SRA does not have the power to issue the expected outcome of the matter, therefore, it must be referred to the SDT.
At what stage of the investigation can I enter a Regulatory Settlement Agreement?
If a Regulatory Settlement Agreement is considered appropriate, the solicitor/law firm can suggest an agreement would be an appropriate solution. The SRA may also initiate the negotiations. This can be done at any stage of the investigation; however, they normally occur after the investigation has concluded.
It normally takes between three to six months for the SRA to serve a Rule 5 notice detailing the allegations and the regulations breached, enclosing the documentation the SRA will seek to rely on. This means there is limited time available for negotiating an agreement.
The SRA may also enter into a Regulatory Settlement Agreement or an Agreed Outcome when a case has already been referred for a hearing before the SDT. This type of situation occurs when the defendant decides to admit breaching the Code or regulations, or new evidence is presented which means a formal SDT hearing is not required to ensure public trust in the profession. In such a case, the SRA will ask permission for the case to be withdrawn; however, it is not guaranteed that the SDT will not insist on a hearing. Therefore, it is crucial to seek legal advice as early as possible so you can be advised if the allegations against you and the evidence to support them mean it may be in your best interests to admit fault prior to the matter being referred to the SDT.
Why are Regulatory Settlement Agreements published?
The SRA will publish Regulatory Settlement Agreements in the same way it would any investigation outcome. However, publication may be averted if it would:
• disclose someone’s confidential or legally privileged information
• disclose someone’s confidential medical condition or treatment
• prejudice other investigations or legal proceedings
Regulatory Settlement Agreements provide a flexible method of ending an SRA investigation. An experienced legal professional, who understands the SRA’s motivations and objectives can use these agreements as a tactical way of securing their client’s best interests and ensuring the matter is swiftly brought to a conclusion.
We have been helping legal professionals with professional disciplinary and regulatory hearings for over 20 years. If you have any questions relating to a Regulatory Settlement Agreement, please call us on 0151 909 2380.