Joint Committee on Justice debate -
Tuesday, 18 Jun 2024

Legal Services Regulatory Authority: Discussion

An Leas-Chathaoirleach

I remind members and everyone else present to turn off their mobile phones or switch them to flight mode as they interfere with the sound system and make it difficult for the parliamentary reporters reporting the meeting. Television coverage can also be adversely affected.

I am delighted to welcome witnesses from the Legal Services Regulatory Authority. The purpose of this part of the meeting is to have an engagement with the authority on its annual report and other matters. I welcome Dr. Brian Doherty, chief executive, and Ms Alison McIntyre, head of legal services, levy and registration department.

Dr. Brian Doherty

I thank the committee for inviting the Legal Services Regulatory Authority here today. I am CEO of the Legal Services Regulatory Authority and I am joined today by my colleagues, Ms Alison McIntyre, head of legal services, levy and registration department, and Mr. Ultan Ryan, secretary to the authority.

The Legal Services Regulation Act was signed into law on 30 December 2015 and the Legal Services Regulatory Authority, LSRA, was established on 1 October 2016. I was appointed as chief executive in September 2017. Since its establishment, the LSRA has built the necessary infrastructure, processes and staffing to deliver on its broad remit. The LSRA is now made up of approximately 60 staff across five departments who deliver a challenging annual programme of work. The LSRA is funded by way of an annual levy issued to the Law Society, the Bar of Ireland and barristers who are not members of the Law Library and not in the full-time service of the State. The levy mechanism was amended by the Courts and Civil Law (Miscellaneous Provisions) Act 2023 and is now intended to fully meet the budgeted expenditure of the LSRA in future years.

The 11 authority members are appointed by Government following nominations from a number of bodies, including a range of statutory agencies and the legal professional bodies. There are six lay members and five non-lay members. The authority has a lay majority and a lay chairperson. The current chair of the authority is Dr. Don Thornhill. The authority is required by law to be independent in the performance of its functions.

The LSRA is tasked with regulating the provision of legal services by legal practitioners - solicitors and barristers - and ensuring the maintenance and improvement of standards in the provision of those services in the State. The six statutory objectives of the LSRA, which we interpret as our operating principles, are protecting and promoting the public interest; supporting the proper and effective administration of justice; protecting and promoting the interests of consumers relating to the provision of legal services; promoting competition in the provision of legal services in the State; encouraging an independent, strong and effective legal profession; and promoting and maintaining adherence to the professional principles of legal practitioners as specified in the Act. Within the framework of those principles, the authority performs a wide range of functions, including the introduction of new business models for legal service delivery, a research and reporting function and the receipt and investigation of complaints about solicitors and barristers.

In our 2023 annual report, the LSRA reported on the fourth full year as the independent complaints handling body for complaints about solicitors and barristers. The LSRA began receiving and investigating complaints on 7 October 2019. Under Part 6 of the Act, the LSRA can receive and investigate three types or grounds of complaint: that the legal services provided were of an inadequate standard; that an amount of costs sought by the legal practitioner for legal services was excessive; and that an act or omission of a legal practitioner constitutes misconduct under the Act. In 2023, the LSRA received 1,290 complaints. The number of complaints closed in the year was 1,432. Of the 1,290 complaints received, 1,233 related to solicitors while 57 related to barristers. In consumer complaints about inadequate legal services or excessive costs, the LSRA is required by law to help both parties to informally resolve these complaints. We have a team of trained mediators to assist with this. If complaints cannot be resolved in this way, they are investigated by the LSRA. Where the LSRA upholds a complaint, it can make directions to the legal practitioner involved to take corrective actions, including paying compensation to the client of up to €3,000. Complaints of misconduct are investigated by the LSRA’s independent complaints committee. This committee has the power to impose sanctions on legal practitioners itself. Where it considers it appropriate, it can refer more serious complaints for the consideration of the Legal Practitioners Disciplinary Tribunal, which is independent of and separate from the LSRA. The complaints committee cannot make findings of misconduct. Only the tribunal can do so. The LSRA takes enforcement proceedings when legal practitioners fail to comply with its directions. In 2023, the LSRA made 12 applications to the High Court for orders to enforce its directions in complaints about legal practitioners. Further information on the complaints process and outcomes can be provided as necessary.

Since November 2019, the LSRA has authorised applications by partnerships of solicitors to operate as limited liability partnerships. The number of LLPs authorised to date is 482.

The LSRA also maintains the roll of practising barristers, which at the end of 2023 had recorded the details of 3,051 practising barristers. It is an offence for a qualified barrister to provide legal services if they are not listed on the roll.

The LSRA is currently in the process of finalising the regulatory framework for the introduction of legal partnerships later this year. Legal partnerships are a new business model for the delivery of legal services aimed at enhancing competition and delivering efficiencies in the delivery of legal services to consumers. Their introduction will allow barristers to work in partnerships with solicitors and other barristers for the first time. Legal partnerships were provided for in the LSRA’s founding legislation.

The LSRA is also responsible for the development and introduction of regulations where required by statute. Since its inception, the LSRA has introduced new regulations in relation to the operation of the complaints process, professional indemnity insurance, limited liability partnerships, the levy on the legal profession and advertising of legal services.

Since its establishment, the LSRA has been responsible for the delivery of a challenging programme of research and reporting. As well as publishing nine biannual reports on the operation of the complaints function and five annual reports on admissions to the legal profession, the LSRA has also published a number of detailed research reports with findings and recommendations for reform to the Minister for Justice on various aspects, such as legal professional education and training and how legal services are provided. The LSRA recently published its reports on the consideration of a new profession of conveyancer which made recommendations in relation to enhanced pricing transparency for conveyancing services, targeted consumer awareness campaigns and digitisation of the conveyancing process. The LSRA, at the request of the Minister, has also prepared a report on the barriers faced by early career barristers and solicitors and has made a number of recommendations for reform.

The LSRA is currently half way through the delivery of its third strategic plan which covers the period 2022-2025. Over the remaining life of this plan, the LSRA will focus on enhancing its operational efficiency in the delivery of its core regulatory operations and services and to promoting professional standards and encouraging innovation and advancement in legal education and training, legal practice business models, access to justice and consumer protection. The LSRA will also continue to improve awareness of the LSRA’s regulatory activities and services as well as other issues relevant to the legal services sector through enhanced communications and engagement with the public and other stakeholders.

I thank the Leas-Cathaoirleach. My colleagues and I look forward to engaging with the committee members and to responding to the issues and questions that they wish to raise.

An Leas-Chathaoirleach

I thank Dr. Doherty for being succinct. I should have mentioned the apologies received at the start. We have received apologies from Deputy James Lawless and Senator Lynn Ruane. I will also mention the long-standing practice, which I know Dr. Doherty has not breached because I have read the opening statement that nobody should be criticised or charges should not be made against anyone or entity by name or in such a way as to make him, her or it identifiable or otherwise engage in speech that might be regarded as damaging to the good name of the person or entity. Therefore, if a witness's statement is potentially defamatory in relation to an identifiable person or entity, they will be directed to discontinue their remarks and it is imperative that they comply with such a direction.

I am going to give members six minutes to ask questions. I call Senator McDowell.

Senator Michael McDowell

I welcome Dr. Doherty and Ms McIntyre. I declare an interest on this occasion since I am a practising barrister. In general terms, I want to compliment the regulatory authority because I have heard no adverse complaints about it since it assumed full control of its functions. It has worked smoothly. One hears on the grapevine of frivolous and vexatious cases brought by people who did not like the way a case was decided and thought either the judge or the lawyers involved on the other side were to blame for losing the case. Those kind of cases apart, I think the authority is taking its work seriously.

When I was Minister for Justice, I was always impressed by the Law Society's professional disciplinary tribunal, which was very tough on solicitors. I remember I appointed at least two lay persons to that body who felt a bit sorry for the solicitors who were before it on occasions. They felt the solicitors were dealt with very sternly but it is necessary to maintain public confidence in the provision of legal services. Bearing in mind all of the changes that have taken place, the authority is doing a very good job.

Could I ask one question on interdisciplinary partnerships and the like? Where are we on that at this stage? Is there a significant number of barristers in partnership with solicitors, accountants or multi-disciplinary bodies, which have come into existence, or are we still awaiting developments on that front?

Dr. Brian Doherty

We are indeed still awaiting developments on that front but it is imminent. On the introduction of legal partnerships, there was an amendment required to the Legal Services Regulation Act 2015 before that framework could be put in place. That amendment was made in June 2023 and we now have a number of regulations and a framework for the introduction of legal partnerships, which is being considered by the authority at its meeting on Thursday of this week. Following that, there will be a new set of legal partnership regulations, an amended set of limited liability partnership regulations, an amended set of professional indemnity insurance regulations and a new code of practice for practising barristers, all of which will allow for the introduction of legal partnerships which we are hoping to happen in quarter 4 of this year. It has not commenced yet, but it will.

The LSRA has committed that once legal partnerships are bedded in and the process and framework is working correctly, it will then revisit the introduction of multi-disciplinary practices whereby legal practitioners may go into practice with other professions such as accountants or architects. It is still in train.

Senator Michael McDowell

That is interesting to know. On the LLPs, there is one point I wanted to ask about. Is the authority happy about the availability of professional indemnity to solicitors, in particular? I do not think there is a problem for barristers in my experience of obtaining mandatory insurance coverage. I think there are, or there were in the past at any rate, jaw dropping premiums extracted by some insurers from sole practitioners. Is the authority in any way worried that mandatory negligence insurance is preventing the development of new, small scale practices, and is driving small scale practices into mergers or retirements to avoid the cost of insurance?

Dr. Brian Doherty

Our role in regard to professional indemnity insurance is in relation to setting the standards for barristers. The role in relation to solicitors was retained by the Law Society once the 2015 Act came into force. I can say that through our engagement with the Law Society over the last couple of years, it has expressed concerns as to the lack of availability of providers and the cost of the premiums. I think it has remedied itself to some degree in the last number of years but it would still be a cause for concern and something the Law Society has commented on in our various interactions with it on that.

I am not sure as to the impact on small-scale firms but I do know whenever insurance premiums were at their height, it was a challenge and a difficulty. In our interactions, not only with the Law Society but whenever we are doing engagement with solicitors and solicitors' groups, it is a topic that gets brought to us frequently. Unfortunately, it is one we have no control over.

Senator Michael McDowell

I know times have changed but when I started as a barrister, it was quite possible for a young solicitor to have the ambition of establishing a single member firm, renting an office, paying a secretary, paying the Law Society annual subscription and paying all the overheads associated with a small practice. Now, you would find people being asked for €30,000 or €40,000 a year in terms of insurance coverage for sole practitioners. That means when you open the door of your practice, virtually every day you have to make €500 just to remain open.

It is a crippling cost for a developing practice in its early days. There was a solicitor's mutual society but it got into difficulties. I wonder whether the cost of insurance is not anti-competitive in its effect. While somebody attempting to start off could be as negligent as a big five firm of solicitors, a daily sum in that amount, as an overhead, is vast and difficult to deal with. It would be hard for the owner of such a practice to get someone into their office to give them €500 a day in order to keep it open. That is the kind of thing we are dealing with.

Dr. Brian Doherty

Absolutely. The Law Society is very active in that arena in trying to ensure that it can negotiate new providers of insurance and drive costs down. We have engaged with other jurisdictions that are introducing innovations, such as solicitors in their areas not holding client funds in order to try to drive down the insurance and looking into technological innovations that might assist when dealing with insurance companies that sees it as risk in those areas.

Deputy Niamh Smyth

I thank the witnesses for coming before us. I have a question in respect of the complaints about solicitors and barristers. Three strands were provided as to what those complaints generally involve. The third of these states that an act or omission of a legal practitioner constitutes misconduct under the Act. Could Dr. Doherty expand on that?

Dr. Brian Doherty

Misconduct is defined in section 50 of the Act under. It is quite a broad definition. It covers fraud or dishonesty where the provision of legal services is considered to be inadequate to a substantial degree. This is outside the provision of legal services. Therefore, if there is an act or omission or otherwise in connection with the provision of legal services - outside of work, as it were - that would justify the fining of a legal practitioner as not a fit or proper person to engage in the provision of such services. There are a couple of offences under the Act which, if committed, would constitute misconduct. These include breaches of the Solicitors Acts, offences under the Solicitors Acts or bringing the profession into disrepute, which is a broad catch-all that is applied in respect of both barristers and solicitors. That conduct could go from being excessively rude all the way up to any sort of behaviour that could be seen as being unworthy of a legal professional.

There is a part of the definition that relates to multidisciplinary practices, which, as stated earlier, are not in play, so it has not been applied yet. Offences under section 50 also include the commission of an arrestable offence, committing a crime or an offence inside or outside the State or seeking an amount of costs that would be considered to be grossly excessive. I mentioned that we deal with consumer complaints in respect of inadequate services and excessive costs where the amount of costs could be considered to be grossly excessive. That might be considered to be misconduct and a breach of the Act and any regulations made under it. There is a singular definition relating to a client being in custody and services being withdrawn without the permission of a court. The latter has not happened since the LSRA came into existence. There have been no allegations in relation to that.

Deputy Niamh Smyth

On the three types of investigations that are carried out and the complaints that are received, where would the balance be in terms of where the most complaints come from under those three strands?

Dr. Brian Doherty

The balance of complaints relate to misconduct. Only a client of a legal practitioner can make a complaint of inadequate services or excessive costs. This makes sense because they are the person receiving the services, but anyone can make a complaint in respect of misconduct. There is also a three-year time limit for bringing a complaint of inadequate service or excessive costs, but there is no time limit in the context of bringing forward a complaint of misconduct. Because the definition is so broad, many complaints that do not fall into the first two categories would fall into the misconduct category. Approximately 65% or two thirds of complaints relate to misconduct and a third relate to inadequate legal services. It has been falling over the past couple of years, but around 3% to 5% relate to costs.

An Leas-Chathaoirleach

Do any of our colleagues online want to ask a question? I do not see any hands up. I will ask a couple of questions.

First, I must declare an interest in that I am a practising barrister and are therefore subject to regulation by the LSRA. Dr. Doherty made reference to, for example, maintaining the roll of practising barristers. Does the LSRA have a list of people who are qualified, who have been called to the Bar or admitted to the inner Bar but who are not on the roll of practising barristers? I ask because I see people all the time describing themselves as barristers. I do not know them. I do not have to know them in order for them to be barristers, but they are not members of the Law Library and I find that they are not on the LSRA's roll of practising barristers. I do not know how anybody can verify whether they are in fact a barrister in those circumstances.

Dr. Brian Doherty

If they are providing legal services as a barrister, they have to be on the roll of practising barristers. It is a criminal offence for someone to provide legal services if they are not on the roll. This is a consumer protection issue. If someone is seeking the services of a barrister, they can check our roll, which available online and searchable, to see if someone is entitled to provide legal services in the State. There have been occasions when members of the public have contacted us to ask if a person is on the roll of practising barristers. In at least one instance, we referred the matter to the Garda because it became apparent that someone may have been providing legal services as a barrister and was not on the roll. If they are providing legal services and they are on the roll, they are subject to a levy and also professional indemnity insurance in those circumstances.

An Leas-Chathaoirleach

It is not a protected term. Anyone can describe themselves as a barrister if they are not providing legal services.

Dr. Brian Doherty

As long as they are not providing legal services or if they intend to provide legal services, they should be on the roll.

An Leas-Chathaoirleach

The same would apply to the term "senior counsel" in both professional contexts. If somebody describes themselves as senior counsel and if they are not holding themselves out as providing the services of a senior counsel, they are not committing an offence.

Dr. Brian Doherty

They should have been granted obviously a patent of precedence in order to do. I am not being flippant, but the latter should have been awarded by the advisory committee.

An Leas-Chathaoirleach

The offence is providing legal services when one is not on the roll, as opposed to having a particular status on the roll. It does not matter whether someone says he or she is senior counsel or not.

Dr. Brian Doherty

No, but we make good efforts to ensure that the recording of new senior counsel on the roll is absolutely accurate, because, obviously, it is a title.

An Leas-Chathaoirleach

The other question I wanted to ask is about the partnerships to which Senator McDowell referred. How far away are we from having multidisciplinary partnerships. I fundamentally disagree with the notion that having barristers and solicitors in partnerships together is going to increase competition. In fact, one of the things that established competition within the legal service in this country is the independent referral Bar. When there is a situation where people are tied to each other, consumers cannot necessarily shop around. If they go to a particular solicitor and a certain barrister is involved in a partnership with that solicitor, that may be the only option available to them. The diminution of the independent referral Bar is problematic. It affects competition in a negative way rather than in the way that Dr. Doherty claimed earlier. That was more of a statement than a question. I am sorry about that.

Dr. Brian Doherty

I will say a couple of things on the introduction of legal partnerships. It is mandated under the 2015 Act. This is something that LSRA has to take on. We have not taken it on in isolation; we have written two reports on legal partnerships that are available. One was on the practice in other jurisdictions and the other was on public consultation. We then conducted a wide-ranging public consultation in order to inform the regulations themselves and the code of practice for practising barristers. The purpose of the consultation was also to try to identify issues, such as the one the Leas-Chathaoirleach, raised in respect of the independent referral Bar in order that we would attempt to address it within the code. I will hand over to my colleague Ms McIntyre in a moment to comment on that specific issue.

We have made extensive efforts to ensure that the legal partnership model will be put in place before the end of the year. We will seek to ensure that we can make it as competitive a model as possible and that the outcome of it will be to allow for a single-stop shop that will mean consumers can go to one solicitor-barrister partnership. Alternatively, it will provide that barristers who may not feel that life at the Bar of Ireland is for them may have another method of delivering legal services in partnership with colleagues and, therefore, being able to share and drive costs down. In the context of the Leas-Chathaoirleach's question on timelines, legal partnerships will be in place before the end of the year. On multidisciplinary practices, we will allow legal partnerships a period to bed in and we will then learn what lessons we can from what occurs in respect of them, the take-up relating to them and any issues that arise.

We will then focus our minds on multidisciplinary practices following that. I will ask Ms McIntyre to take the question on the role of the regulatory authority.

Ms Alison McIntyre

Certainly. The only thing to add to what Dr. Doherty has said is that under the Act, our role is in the implementation of legal partnerships. In performing that role, we are trying to balance consumer protection and the provision of legal services to a high standard. One of our objectives under the Act is to promote competition in the sector. Basically, our role is implementation. That decision was made and is catered for within the Act.

On the specific matter the Leas-Chathaoirleach mentioned with regard to what would happen if a client goes to a solicitor who is in partnership with a particular barrister and would this automatically mean that it is the barrister within the partnership who is retained, as Dr. Doherty said in response to another question, we have draft regulations that are going before the authority, which is our board, on Thursday. In those draft regulations as they currently stand, there is a provision that there is an obligation on the solicitor in that circumstance to advise the client that they have the option to seek to refer the matter or to seek to retain the services of counsel outside of the legal partnership.

More generally, we are very much aware of the necessity for the benefit of everybody having access to good legal representation. We have put into the draft regulations reciprocal obligations on barristers and solicitors if it is a barrister and solicitor partnership but neither would interfere with the professional obligations of the other in the context of the legal partnership. This is just to give the context for that. As Dr. Doherty has already outlined, as part of the introduction of legal partnerships, we are also introducing a code of practice for practising barristers. These will all be introduced as a suite through the regulations and a code, which will be made at the same time.

Senator Michael McDowell

I have a supplementary question. What about people who exercise EU rights to appear in litigation or to act in litigation matters in the Republic? Does the authority have any function in relation to them or is that a lacuna?

Ms Alison McIntyre

At present, there are various different EU directives in play. Maybe I am not interpreting the Senator's question correctly, but there is a definition of a registered lawyer, which is provided for in our Act, whereby there is that recognition. If somebody wants to apply to become a registered lawyer in Ireland and is a solicitor, he or she can go via the Law Society. If the person is a barrister currently, he or she can go via the Bar of Ireland. In the definition of somebody who would be entitled to come to Ireland, and in the case of a barrister having his or her name put on the roll of practising barristers, a registered lawyer meets that definition. In that sense, once the person is on the roll of practising barristers in Ireland, he or she is entitled to provide legal services in the State. Does that address the question?

Deputy Niamh Smyth took the Chair.

Senator Michael McDowell

If a French avocat presented himself or herself here and wished to exercise rights in this regard, would he or she have to go to the professional body first and then become amenable to our regulatory authority's jurisdiction? If, for instance, they act at an inquest or a tribunal, do they escape the authority's jurisdiction?

Ms Alison McIntyre

Again, I apologise, and I can certainly follow up with a written response to the question, but, as far as I am aware, there are two or three different EU directives that may be in play. As I said, the issue in relation to registered lawyers is covered in the 2015 Act. Basically, the person goes on the roll of practising barristers if the intention is to provide legal services if the person is a qualified barrister or a registered lawyer. That would be the means by which-----

Senator Michael McDowell

So it is a registered lawyer.

Ms Alison McIntyre

Yes. That would be the means by which they would get the entitlement to provide legal services in the State. As Dr. Doherty mentioned in reply to another question, once the person is on the roll, other obligations are triggered. I refer, for example, to the payment of the levy. In Ireland, a person must have professional indemnity insurance in place at the time of the provision of the legal services. For example, a registered lawyer might be on the roll but not actively providing legal services in the jurisdiction at the time. Such a person would not have to have the professional indemnity insurance in place until such time as he or she is actually providing legal services.

Senator Michael McDowell

I have one last question. With regard to issues the Bar Council's professional practices committee deals with, for example, behaviour towards other barristers and the like, is the committee's independent function satisfactorily operating or is there a clash or a friction point with the regulatory authority's jurisdiction?

Dr. Brian Doherty

Is that regarding the Bar's professional conduct rules?

Senator Michael McDowell

Yes.

Dr. Brian Doherty

Once the Legal Services Regulatory Authority was established, the Bar took steps to wind down the-----

Senator Michael McDowell

They do have a professional practices committee-----

Dr. Brian Doherty

Sorry, yes, the committee.

Senator Michael McDowell

-----that imposes the Law Library or Bar rules.

Dr. Brian Doherty

I understand the question. No. If someone makes a complaint or brings a complaint to us in relation to a barrister, it falls in our jurisdiction and in our jurisdiction alone to deal with it. The Bar Council still has a role in imposing whatever internal rules it decides upon. With any professional code, the Bar Council or the Law Society at King's Inns would seek put in place, we do have a function in reviewing them. There has not been any conflict to any great degree so far.

Senator Michael McDowell

I am glad to hear that.

An Cathaoirleach Gníomhach (Deputy Niamh Smyth)

I do not believe any members are indicating online. That concludes the business for this session. I thank the witnesses very much for their co-operation with our members and for their statements.

I propose that we go into private session to deal with some housekeeping matters. I wish to let the witnesses know that we publish the opening statement on our committee web page. Is that agreed? Agreed.

The joint committee went into private session at 4.46 p.m., suspended at 4.52 p.m., and resumed in public session at 5.12 p.m.