Why Should I Consider An SRA Agreed Outcome

In November 2019, it was reported by the Law Gazette that the number of ‘sitting days’ for the Solicitors Disciplinary Tribunal (SDT) this year is projected to be “vastly” down (26%) on last year. This represents a reduction in sitting days from 406 in 2019 to 300; a considerable reduction by any measure. In part, it is believed this is due to the increase in disciplinary cases resolved by the SRA by entering into ‘Agreed Outcomes’ with the Respondents. But what are ‘Agreed Outcomes’, when are they likely to be used, and what are the alternatives?

What are SRA Agreed Outcomes?

Under the ‘Agreed Outcomes’ approach, the SRA and a Respondent come to an agreement as to which allegations are admitted, the form of any corresponding sanction/s, and how the solicitor will “put the matter right”. The agreed facts are documented in the form of a ‘Statement of Agreed Facts and Outcome’ document, which is then passed to the SDT for approval of the judgment. As such, an Agreed Outcome overcomes the stress and cost of a complete SDT disciplinary process.

In one such case, three Respondents at law firm Clyde & Co LLP (Clyde) were able to resolve disciplinary proceedings by the SRA using Agreed Outcomes . The SRA had undertaken an investigation into allegations that they had used the firm’s client bank account as a banking facility, in breach of Rules 6 and/or 14.5 of the SRA Accounts Rules 2011, and/or Principles 6 & 8 of the SRA Principles 2011, and the Money Laundering Regulations 2007 (MLR 2007). Specifically, it was found that some of the Respondents had failed to adhere to the Law Society’s Fraudulent Financial Arrangements guidance and the Warning Notice on Money Laundering by acting as an escrow agent on behalf of a client. It was also found that there were inadequate procedures for the handling of dormant client balances as required by the SRA Accounts Rules 1998. The Respondents admitted breaching the MLR 2007 by using the firm’s client bank account as a banking facility when there was no underlying legal transaction. On reviewing the case, the SDT agreed that while the matters were serious, they were “not at the highest level of seriousness” and, as such, the Tribunal approved the proposed Agreed Outcome. In doing so, the three Respondents were found to have acted without integrity, probity or trustworthiness, and were fined £10,000 each, ordered to pay costs of £82,454 jointly and severally, and the firm was fined £50,000.

What is contained with a Statement of Agreed Facts and Outcome?

In order to enter into an Agreed Outcome, a Statement of Agreed Facts and Outcome is drafted and signed by a Respondent, and then submitted to the SDT for their judgment. The document explains each of the allegations made, admissions made by the Respondent (i.e. the SRA rules breached), agreed facts (i.e. details of the specific breaches for each allegation made), mitigations and other relevant facts, and the Agreed Outcome and sanction.

The sanction and Agreed Outcome section will typically include an admission by the Respondent of the severity of the admitted misconduct, the final outcome (e.g. being struck-off), a binding undertaking by the Respondent of the actions they will personally take, and any costs to be paid. By entering into a Statement of Agreed Facts and Outcome, the solicitor also agrees that if they do not comply with any binding undertakings, the matter may be referred back to the SDT. Following consideration by the SDT of the statement, and if they agree with its contents, a ‘Judgment on an Agreed Outcome’ will be drawn up.

How is a Regulatory Settlement Agreement (RSA) different from an Agreed Outcome?

RSAs are intended to bring an end to disciplinary proceedings in whole or in part and are more commonly used in less serious cases. The SDT does not play a part in the approval of any recommendations made by the SRA in an RSA – as they would in Agreed Outcome proceedings. The timescale to enter into an RSA is also strictly limited.

What should I do if I am invited to enter into an Agreed Outcome?

From the outset, always comply with the SRA in a professional, courteous, and timely manner to any enquiries made. Remember, it is in the SRA’s discretion to offer you the option of an RSA or Agreed Outcome, and your conduct at all times will help determine the position they take. From the point you are informed that the SRA is investigating your professional conduct, consider engaging the services of a reputed and experienced regulatory solicitor; your career and reputation may depend upon it.

Your solicitor will liaise with the SRA on your behalf and will compile a robust, detailed, and evidence-backed response, to ensure any Agreed Outcome is complete and reassures the SRA and SDT. Where it can be shown that efforts were made to limit or mitigate the impacts of a breach of the SRA Standards and Regulations, these must be included to demonstrate that while you made a mistake which you fully acknowledge, you endeavoured to rectify the matter. It will also serve to add confidence that you are likely to comply with any Agreed Outcome.

Being on the receiving end of a disciplinary investigation by the SRA can be deeply unsettling, but by taking a calm and measured approach based on the facts of your case, an RSA or Agreed Outcome can enable you to put the matter behind you without facing a formal disciplinary hearing in front of the SDT.

We can help you. We are highly experienced in this area of law and know how to craft an intelligent and persuasive response.

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