Solicitors (Amendment) Bill, 1998: Second Stage.

Question proposed: "That the Bill be now read a Second Time."

Minister for Justice, Equality and Law Reform (Mr. O'Donoghue)

The main purpose of this Bill is simple. It allows for better control of advertising by solicitors. It deals with the nature and extent of the advertising and it prohibits specifically advertising which expressly or by implication refers to claims for damages for personal injury. The Bill achieves its objectives by specifying what may be and may not be contained in solicitors' advertising; requiring the Law Society, as the regulatory body for solicitors, to make regulations governing such advertising; treating contravention of the advertising provisions in the Bill as misconduct by a solicitor for the purposes of the Solicitors Acts and enabling the society to obtain a High Court injunction prohibiting contravention of those Acts in regard to advertising and other matters concerning the conduct of solicitors.

The Bill is a response to growing concern about the excesses of advertising by some solicitors, particularly in the area of personal injuries. The doubts which have existed about the effectiveness of existing controls have been heightened in Army hearing loss cases. No one familiar with the advertising which has occurred in this area can be left in any doubt about the extent to which members of the legal profession are prepared to go to stir up business on behalf of clients against employers, occupiers, State organisations or any other mark for damages. I am not referring to ordinary type advertising but to "in your face" and personalised advertising and ambulance chasing that should have no place in the legal profession.

The intention in the Bill is to ensure the solicitors' profession as a whole will work within a reasonable standard advertising code. The reality which cannot be ignored is that the actions of a few have tended to lower the public's respect for the profession and it is time now that the matter is addressed.

I am heartened by the fact that the Law Society has resolved to support the Bill. The society points to the fact that when it decided to allow limited advertising by solicitors in the late 1980s it was alert to the possibility that advertising for personal injuries work might damage the reputation of the solicitors' profession. That possibility has now come to pass. It is only fair to point out that the regulations which the society introduced at that time set certain limits on the nature of solicitors' advertising which were not without some strength. A difficulty is that some solicitors have stretched those limits to the full and the result is that the present code on advertising is not operating satisfactorily.

Before I outline the main features of the Bill, it is worth recalling what the present provisions of the law contain. I will then inform the House what changes are provided for in this Bill.

The Law Society carried out admirable work on a code of conduct over a long period of time which culminated in 1988 in a code entitled "A Guide to Professional Conduct of Solicitors in Ireland". It is the work of many eminent solicitors and it is a monument not only to them but to the wisdom of the society in promulgating the work and seeing it to finality. The year 1988 happened also to coincide with a change in the society's rules on advertising. It elected in that year to allow advertising under certain conditions.

Heretofore, the society since 1955 had, by regulation, prohibited solicitors from advertising their services to the public. While the 1988 regulations allowed solicitors to advertise, they prohibited advertising which was in bad taste, false or misleading, claimed specialist knowledge or superior quality of service over other solicitors or was critical of other solicitors. This new approach by the Law Society to advertising was endorsed in 1990 by the Fair Trade Commission in its report on the study of restrictive practices in the legal profession. Those advertising provisions were, in effect, put into primary legislation by the Solicitors (Amendment) Act, 1994. The statutory code which now applies to advertising by solicitors can be briefly described as follows.

Section 71 of the Solicitors Act, 1954, empowers the Law Society to make regulations with respect to the professional practice, conduct and discipline of solicitors. That section was extended by the Solicitors (Amendment) Act, 1994, to provide that the society may not prohibit advertising except in the case of advertising which is likely to bring the solicitors' profession into disrepute, is in bad taste, reflects unfavourably on other solicitors, contains an express or implied assertion that a solicitor has specialised knowledge superior to other solicitors, is false or misleading, consists of unsolicited approaches to individuals for business or is contrary to public policy. These provisions, which mirrored to some extent the 1988 regulations made by the Law Society, were given detailed effect by the society by regulations made in 1996.

Under the 1996 regulations a solicitor is required to furnish the Law Society with a copy of an advertisement issued within a 12 month period of its date of issue when requested to do so by the society. Breaches of the regulations may be investigated by the disciplinary tribunal of the society and may be found by the tribunal to be misconduct within the meaning of the Solicitors Acts of 1954 and 1960. The 1994 Act gives the disciplinary tribunal power, where it has found a solicitor guilty of misconduct, to advise, admonish or censure that solicitor and to order him or her to pay a sum not exceeding £5,000 to the compensation fund of the society. In addition, it has the power to refer the matter to the High Court which has the power, inter alia, to strike the name of the solicitor off the roll, suspend the solicitor from practice for a specified period of time or place restrictions on the solicitor's practice.

A person who refuses to obey a direction of the tribunal is guilty of an offence which carries a maximum fine of up to £10,000 and/or two years imprisonment. Where the offence is tried summarily the maximum penalties are a fine of £1,500 and/or 12 months imprisonment. Disciplinary tribunal orders may be appealed by a solicitor to the High Court.

The provisions I have mentioned have considerable strength. The Bill repeals and re-enacts many of the provisions of section 71 of the 1954 Act as inserted by the 1994 Act and extends those provisions to ensure that the type of excesses of advertising experienced to date will be a thing of the past. I now turn to the specific provisions in the Bill.

Section 1 is the main provision. It amends section 71 of the Solicitors Act, 1954, which relates to regulations with respect to the professional practice, conduct and discipline of solicitors, by the substitution for subsections (2) and (7) of ten subsections, many of which contain either new or amended provisions. Before dealing in detail with these new subsections, I draw Senators' attention to the definitions which are contained in new subsection (10) The definition of "advertisement" is wide and covers any communication, whether oral or in written or other visual form and whether produced by electronic or other means, which publicises a solicitor or his or her practice and includes any brochure, notice, circular, leaflet, poster, placard, photograph, illustration, emblem, display, stationery, directory entry, article or statement for general publication. It also covers any audio or video recording or any presentation, lecture, seminar or interview.

The definition of "claims for damages for personal injuries" means claims, whether made in court proceedings or otherwise, for damages or compensation for personal injuries suffered by a person owing to an act or omission of another person and "personal injuries" is defined as including any disease and any impairment of a person's physical or mental condition, or death.

New subsection (2), as provided for in section 1 of the Bill, corresponds to subsection (2) in existing law and associated regulations in so far as it prohibits solicitors from publishing or causing to be published an advertisement which is likely to bring the solicitors' profession into disrepute, is in bad taste, reflects unfavourably on other solicitors, contains an express or implied assertion of specialist knowledge in any area of law or practice which is superior to that of other solicitors, is false or misleading and is contrary to public policy.

However, other provisions in subsection (2) which are new help to strengthen the law on advertising by solicitors. A solicitor under the subsection will be prohibited from publishing or causing to be published an advertisement which is published in an "inappropriate location". An "inappropriate location" is defined in subsection (10) as including a hospital, clinic, doctor's surgery, funeral home or cemetery. Advertising under subsection (2) will also be prohibited which expressly or impliedly refers to claims or possible claims for damages for personal injuries, the possible outcome of such claims or the provision of legal services in connection with such claims or which expressly or impliedly solicits, encourages or offers any inducement to any person or group to make such claims.

A key provision in the Bill is new subsection (3). It prescribes the information which may be contained in a solicitor's advertisement. An advertisement must not include more than the name, address including electronic address, telephone and facsimile number and place or places of business of the solicitor, particulars of the academic and professional qualifications and legal experience of the solicitor, factual information on the legal services provided by the solicitor and any areas of law to which those services relate, particulars of any charge or fee payable to the solicitor and any other information specified in regulations made by the Law Society. New subsection (4) makes clear that, without prejudice to the prohibition on advertising in relation to claims for personal injuries contained in subsection (2), solicitors may, when advertising, include the words "personal injuries" without any further elaboration.

The Law Society will be required under new subsection (5) to make regulations, with the Minister's consent, to give effect to provisions in the Bill. The regulations, among other matters, must make provision in relation to advertisements by a solicitor, including the manner of their publication and their form, content or size. The regulations must restrict solicitors from "touting" and the regulations must also provide for the manner of determination by the society of a contravention of the advertising provisions in the Act or regulations made under it.

Subsections (6), (7) and (8) repeat existing provisions in the Act of 1994. Subsection (6) provides that the Law Society may, by regulations made with the Minister's consent, prohibit the advertising by solicitors of any charge or fee for a specified service where the society considers it appropriate and where the Minister is satisfied that such regulations are in the public interest.

Subsection (7) provides that the Law Society shall not prohibit a solicitor from charging less for a legal service than any charge or fee specified under any enactment for the time being in force. Subsection (8) empowers the Law Society to provide by regulations that solicitors who satisfy the society of specialist knowledge in a prescribed area of law or practice be permitted to advertise themselves as having such knowledge.

Section 2 of the Bill makes clear that the advertising controls provided for in section 1 in relation to personal injuries apply also to non-solicitors. Section 3 of the Bill provides that sections 1 and 2 shall not apply to advertisements published not more than three months after the commencement of the Act. This will give solicitors a reasonable time within which to acquaint themselves with the new provisions in the Bill and to be on notice on how to act within the parameters of those provisions in the future.

The Solicitors Acts as they stand specify what constitutes misconduct by a solicitor. Breach of advertising provisions in those Acts constitutes misconduct and section 4 of the Bill extends the definition of misconduct for the purposes of those Acts to include breach of the new advertising provisions in the Bill.

Section 5 of the Bill provides that, on application by the Law Society, the High Court may, where it is satisfied, grant an injunction prohibiting contravention of the Solicitors Acts, 1954 to 1998, by a solicitor or any other person notwithstanding that such contravention may constitute an offence. The background to this new section is that in a High Court case, Incorporated Law Society of Ireland v. Carroll and others — 1993 3 Irish Reports 145 — the Law Society sought declarations that a defendant who was not a solicitor had, in holding himself out to be a solicitor, contravened the Solicitors Act, 1954, and sought injunctive relief restraining him. In refusing to grant the injunction the court held that, while the society had power to bring a criminal prosecution against a person who commits an offence under the Solicitors Acts, it did not have power to obtain an injunction to prevent a person from breaching the Solicitors Acts. Section 5 of the Bill now provides for that power against any person, both solicitors and non-solicitors.

Section 6 of the Bill is standard and sets out the short title, commencement, collective citation and construction. The Act will come into operation on such day, not being later than three months after its passing, as may be appointed by the Minister.

The Government is satisfied that the Bill represents a clear statutory framework which will ensure that in future solicitors' advertising will be balanced while at the same time will be geared towards informing the public of the range of services provided by the profession.

I am satisfied that the Bill as framed and the regulations to be made by the Law Society under provisions in the Bill which aim at stricter control of advertising on the basis of general criteria, and at very specific control of personal injuries advertising, will together represent a reasonable balance between the right to communicate and the need to maintain good ethical standards in the legal profession, consistent with public policy.

I mentioned the "Guide to Professional Conduct" drawn up by the Law Society in 1988. The foreword to that code by the then President of the Society, Thomas D. Shaw, is as relevant today in the context of this Bill as it was in 1988. He stated that "sound ethical conduct is the foundation on which any profession should base the conduct of its business" and among his concluding remarks he stated:

This Code of Conduct attempts to translate ethical philosophy into a practical set of rules and conditions, based upon sound common sense, culled from the collective wisdom of practitioners over many years. Professional conduct is largely a matter of self-discipline. It has to do with personal pride, pride in oneself and in one's profession. It transcends the purely legal aspects of a situation, because sometimes even when the legal niceties are attended to there can be a choice between common sense and sharp practice. Ethical conduct has to do with standards of common decency, the observance of which affects that very precious commodity "the good name of the profession" to which every solicitor has the honour to belong. It is to be hoped that this Code of Conduct will act as a ready reference to solicitors as to what is proper in the many diverse situations in which they find themselves as they go about their daily business in close proximity with the public which they have the honour to serve.

The Bill does not substitute for the principles and the honour that is enshrined in that code. On the contrary, the Bill complements that code and furnishes it with powers which the Law Society needs to have to make and operate properly a code of advertising for its members.

I commend the Bill to the House.

Mr. Connor

I accept that this Bill is necessary, but the Government has nobody to blame but itself for the need to introduce it, as ten years ago the then Fianna Fáil Government pressurised and threatened the Law Society into dropping the society's generations-old ban on advertising by solicitors. The issue was very divisive among solicitors at the time, but there was a ministerial threat hanging over them that if they did not voluntarily drop the rule prohibiting members from advertising, the Government would impose it by statute. The decision was put to a postal ballot by the Law Society and there was a divisive debate on the matter. The result of the ballot was in favour of lifting the ban, but both those in favour of and those against the ban agreed that what influenced the outcome in favour of lifting the ban was the very aggressive, pro-advertising stance of the then Government.

After this vote the Law Society introduced a set of regulations which allowed advertising with severe limitations by solicitors in response to the ballot. However, all restraint in those regulations was lost when the then Fianna Fáil Minister for Justice, Ms Máire Geoghegan-Quinn, introduced the Solicitors (Amendment) Act, 1994. Section 71 of the Act was an "open sesame" to advertising by solicitors. The argument made in 1988 and 1994 was that if solicitors were allowed to advertise their services it would lead to greater competition and hence better value for clients. What happened was that a large section of the solicitors' profession engaged in advertising their services and specialisations in an acceptable manner and might be some evidence to show that better value accrued to clients as a result, but a small section of the profession engaged in aggressive advertising of the worst possible type. The phrase "ambulance chasing" entered into common use.

One could read in newspapers and the Yellow Pages advertisements by firms of solicitors saying “If you slip or fall, claim with confidence, contact us”. Other such advertisements read: “Personal injuries, no win, no fee. We settle most of our cases out of court so you do not have to worry about embarrassing publicity”; or “Make sure you receive the compensation you deserve if you have a personal injury claim or a medical negligence case or, perhaps, an Army deafness claim”. The worst case of bad advertising of which I am aware was an advertising billboard on the back of a taxi and addressed to any motorist driving behind that vehicle. It read: “If you accidentally collide with the car in front of you, you may have a successful and lucrative personal injury claim to make. We are the experts to advise you, contact us”. It was signed Messrs. X, Y or Z, solicitors. Every possible blandishment was and is still offered to go to law on the slightest pretext and join the burgeoning “compo culture”. Such advertising usually tells the potential client that the first consultation is free. The Minister might correct me on this point, he is a practising solicitor and I am not aware of what his practice is. It has always been the case among 90 per cent of solicitors that first consultations are free. Such an offer is generally phony.

I emphasise that the remarks I make are only to condemn the bad taste of such advertising, the kind of encouragement it seeks to give and the blatant appeal it has to the litigious minded people who are very often ill intentioned. Such advertising is clearly directed at such people. Those solicitors who engaged in such advertising are quite entitled to do so; they do so by virtue of laws made in this and the other House. One wonders what the great advocate of liberalising the advertising rules governing the legal profession, Deputy O'Malley, has to say now. I await with great interest what he has to say on this Bill in the Dáil.

Miss Quill

I invite Senator Connor, on Deputy O'Malley's behalf, to be present.

Mr. Connor

I shall listen with great interest.

Miss Quill

Deputy O'Malley has enormous experience in this area.

Mr. Connor

I do not doubt that.

An Cathaoirleach

Senator Connor without interruption. Senator Quill will have an opportunity to make her contribution.

Mr. Connor

There has been a huge increase in the number of personal injury claims before the courts. That includes Army deafness cases. There is no doubt that this has been driven by the greedy, aggressive and unprofessional advertising by a small section of solicitors and lawyers. We, in this and the other House, must act to curb it. The process has damaged the image and esteem of the legal profession. Lawyers, like politicians, are eternally involved in a battle about their public esteem and good reputation. Anything that damages the reputation and good name of legal practitioners damages the rule of law. We must do all possible to change that.

We are speaking about solicitors today, but the legal profession also includes barristers, senior counsel, etc. There is a huge amount of justified criticism of the fees charged by these people for their work. One only has to refer to the beef tribunal where £30 million or £35 million was paid out in legal fees alone. Huge fees are usually involved in insurance cases also. The "compo culture" which has grown up in this country did not happen over night; it has been greatly promoted by sections of the legal profession, though not necessarily solicitors. Other people are also involved.

An article in the Irish Independent of 12 October by Brian McDonald and Fergus Black under the heading “Council Claims top £30 million” related to claims against local authorities and health boards amounting to £30 million in 1997 and that up to £10 million of that went to lawyers. Most of that £10 million would not necessarily have gone to solicitors, it would have gone to other branches of the legal advice profession — for example, barristers, senior counsel etc. I am sure the public are wondering about the ethics of such payments.

These claims are rising by 5 per cent per annum. The Irish Public Bodies Mutual Insurance Company, the insurer of local authorities and health boards, has given some startling figures on this in recent times. It also informs us that at any one time there are 10,000 cases pending and that up to 20 per cent of all actions against public bodies are reckoned to have a fraudulent element about them. Much of that fraudulent element would be based on advice that they should claim. Most people going before courts find the situation quite boring and rather hostile, but they are advised to do so. Anyone going before the courts is advised to take the advice of their legal representative. The Minister ought to take note of the question raised by the Irish Public Bodies Mutual Insurance Company and the figures I have given because behind them lies a matter that merits investigation.

The vast majority of solicitors carry out their work in a most efficient and professional manner. They have to deal with people's most confidential and personal details, such as personal property, wills, life savings, mortgages, legal actions etc. Such information is entrusted to the advice and care of family solicitors. There must be absolute confidentiality and trust between a solicitor and the client. Their work is of enormous importance to the values we hold dear in society. I, too, recognise the fact that the solicitors profession is one of the most regulated professions. It is more regulated than the medical or teaching professions. The Minister quoted from a recent publication which set out how well regulated the profession is. I take that on board.

The incoming president of the Law Society and its director general have expressed strong support for the changes we are enacting today. They have publicly declared their distaste of the current over-the-top advertising allowed and encouraged by the actions taken by the Haughey Government in 1988 and the Reynolds Government in 1994.

In conclusion, I wish to raise a point often taken up with me by people wishing to enter the legal profession. This Bill should have addressed an anomaly which has caused a great deal of controversy and against which people have a justified case, which is that if Irish law graduates wish to train as solicitors in the Law Society in Blackhall Place they must pass an entrance examination. This situation arises from a legal action taken in the Irish courts by law students from Belfast who demanded that Blackhall Place should recognise their degrees as sufficient to exempt them from sitting the entrance examination — prior to that case there was no entrance examination for graduates with law degrees from the main Irish universities.

The judge, who I think was Justice Mary Laffoy, decided there would have to be either an entrance examination for everyone or no entrance examination; in other words, everyone would have to be given an equal chance of securing a place. The Law Society reacted by introducing an entrance examination for everyone, which I think should be lifted.

There are other routes to becoming a solicitor than just taking a law degree but they are quite difficult. For example, law clerks working in solicitors' offices often do the examinations incrementally and then sit the entrance examination for Blackhall Place, which is fair enough. However, they would, generally speaking, have no crib with people who have gone to college and taken a law degree not having to sit the entrance examination, which would be a duplication of their degree.

The only way to change the decision of the High Court judge some years ago would be to introduce legislation in these Houses. The Minister should look closely at the matter. It is a pity, given that this is a live issue and we may not address solicitors legislation for several years, it was not addressed in this Bill.

My party has no problem with this legislation. We foresaw many of these matters years ago — in 1988 and 1994, especially when the Solicitors (Amendment) Act, 1994, was going through these Houses. We welcome the fact that the Minister has recognised those problems and has introduced this amending legislation.

Mr. L. Fitzgerald

I again welcome the Minister to the House. He very generously gave us his time yesterday in the midst of a hectic and busy schedule. It is great he is coming to the Seanad in person to listen to our deliberations.

I was interested to hear Senator Connor's observations on what happened in the late 1980s when solicitors were first permitted to advertise. He made the fair point that it was introduced in an effort to tackle and confront the spiralling legal costs which were acknowledged by all and sundry to be out of order. There was a need to take significant and definite action to bring some sort of balance and reasonableness to the situation.

In any profession or market for services competition, based on the laws of demand and supply and the information and knowledge available in such a market, should be a reasonable and effective way to combat such a problem. In hindsight, as Senator Connor rightly pointed out, we found that it was not adequate in this case and we are left with this situation today.

By its nature, the legal profession provides a hugely significant and profound service to the public. However, because of the vital importance of the service there is an obligation and duty on the Minister and everyone with an input to the profession to ensure that solicitors are accountable and that they provide their service to the highest standards possible and with the highest ethics.

I welcome this important Bill. It is heartening and laudable it has been initiated in the Seanad, where many Bills were initiated in the last session. It was published in early summer in response to doubts which arose in recent times about the effectiveness of existing controls on advertising by solicitors, particularly in the area of personal injuries. The perceived weaknesses in existing controls were most acutely demonstrated in the recent rash of Army hearing loss cases.

It is important to emphasise that the Bill is not trying by direct or subtle means to prohibit or obstruct the legitimate right of persons to seek compensation or redress for substantial injuries which were genuinely sustained. Such attempts to prohibit or obstruct that legitimate right would have to be vigorously opposed by all fair minded persons. If any person sustains a significant physical or mental disability as a result of the wilful or careless action of another, they are within their rights to seek redress for serious impairment of the quality of life which they previously enjoyed.

The main purpose of the Bill is to amend section 71 of the Solicitors Act, 1954, so as to provide stricter controls on advertising by solicitors, particularly in the area of personal injuries. The Bill also prohibits a person who is not a solicitor from advertising for reward legal services in respect of personal injuries in a manner which is no longer open to solicitors, and it prohibits solicitors from having any direct or indirect connection with such a person.

The most significant aspect of the Bill is that it was prepared in consultation with the Law Society of Ireland, which is the self-regulatory body for solicitors. The Law Society is in general agreement with the provisions and, to my knowledge, has publicly welcomed the Bill. The Bill further empowers the Law Society by enabling it to obtain a High Court injunction prohibiting contravention of the Solicitors Acts, 1954 to 1998, by a solicitor or any other person.

One of the strongest criticisms levelled at some solicitors recently relates to the practice known as "ambulance chasing", referred to by Senator Connor, which is seen, at the very least, to be in bad taste. It is widely accepted that the various manifestations of this form of solicitors' advertising, albeit by only a very small minority of solicitors, is bringing the legal profession generally into disrepute. There is no doubt that this practice is fanning and fomenting a widely escalating claims culture, known as the "compo culture", which has grown into a huge business in recent years.

There is very strong evidence to suggest that advertising by solicitors contributed significantly to the ever increasing flood of Army deafness cases. I do not envy the Minister for Defence in his efforts, on behalf of the taxpayer, to grapple with this runaway train, as he so appropriately referred to it. He realises only too well that the financial implications for the Exchequer are potentially astronomical. I salute him in his very publicly expressed determination to face up to his responsibilities fairly and squarely in these circumstances.

Anyone who would contend that solicitors have not played a significant role in this affair cannot have been reading the print media or even glancing at advertising. There are plenty examples of this. Senator Connor referred to the types of advertising there are and I wish to refer briefly to three or four examples of advertising by a small minority of solicitors which give the lie to any protestation or assertion that a minority of solicitors do not play their part in fanning and fomenting this "compo culture".

There are glaring headlines in advertisements by solicitors such as "Army deafness". Such advertisements are directly, loudly and provocatively targeting specific people. Others say "Don't leave it too late". Psychologically, that is telling people to claim now, not to leave it too late and that there is something big in it for them. As Senator Connor rightly said, the first consultation is free but we always understood that to be the case when we go to a solicitor. It is deception.

Miss Quill

Gross deception.

Mr. L. Fitzgerald

It is blatant and gross deception. We always understood that when we go to a solicitor's office for the first time, it is basically to state our case and that it is not really for a consultation or to get legal advice. This blatant example of touting, to use the Minister's word, is not acceptable; it is unethical and goes against any sense of decency in terms of professional standards of operation.

Another heading in a newspaper in July 1996 read: "Defence Forces — Any member or former member of the Defence Forces, including the FCA and Slua Muirí, who has a hearing impediment which may have arisen as a result of membership please contact." Another heading read: "Hearing problems — If you are a member of the Defence Forces, Slua Muirí or the FCA and you have a hearing problem, you may have a claim.". That is very provocative, blatant and inducive to people. A further heading advertised for personal injury claims, military injuries and noise related injuries again prompting, encouraging, goading and guiding people with ill intent. As Senator Connor rightly said, there are many people with ill intent who would love to and who have succeeded in taking claims against not only Departments but local authorities. Once they read these advertisements, they do not need much more legal advice because they are propelled, promoted and netted into the system.

Recently we learned that Garda management ordered chief superintendents to vigorously investigate compensation claims for deafness brought by members of the Garda Síochána. Although it is not anticipated that a major crisis on the scale of the Army hearing controversy is likely to emanate, it is an example of how this culture is spreading. Even more disconcerting is the ongoing and growing bill for public liability claims against local authorities and health boards, to which Senator Connor referred. This bill totals £30 million per year according to most recent figures and the number of claims is increasing by about 5 per cent each year.

Irish Public Bodies Mutual Insurance, the company which handles public liability insurance for local authorities and health boards, says it is inundated with claims, dealing with more than 10,000 actions at any one time. It says the major urban centres of Dublin, Cork, Galway and Limerick account for the majority of these claims. This insurance company estimates that the element of fraud attaching to these actions is as high as 20 per cent; in other words, it determines that at least one-fifth of claims are fraudulent. That is a frightening figure. It is obvious that the consequences of the compensation culture — or "compo" culture — are getting out of hand.

Public authorities as well as Departments have a duty on behalf of the tax paying public to fight back, and several are already doing so. A number of authorities have co-operated and employed private investigators to catch bogus claimants. They are also vigorously defending cases in the courts. The onus is on all public bodies to adopt these tactics as the alternative to making settlements which they know are unjustified.

Among the many startling revelations which have unfolded as a result of the employment of private investigators was that there existed in many instances a highly organised rent-a-witness service or network. When information was collated across different public bodies in the same area certain names repeatedly cropped up as repeat claimants and, even more sinisterly and interestingly, as repeat witnesses. Clearly, the claimants and witnesses were part of the same ring.

When these unscrupulous and fraudulent practices are held up to public scrutiny, it is inevitable that the role of the legal system and solicitors is brought into sharp focus. That is unavoidable. Assertions of professional licence or the right to exemption from scrutiny for practices employed by solicitors as participants in the processing of these cases simply have no validity and cannot be tolerated. In these circumstances, solicitors must be fully amenable to scrutiny and it is as a result of that scrutiny that the provisions of this Bill have emerged, after consultation with the Law Society of Ireland. I commend the Minister on the manner in which he worked in close consultation with the Law Society of Ireland. It is important that these statutory provisions, regulations and principles, as enunciated in this Bill, have come forward after full consultation with the self-regulating body itself.

In case I gave an impression about the Law Society of Ireland as a self-regulating body which I did not intend — and the solicitor profession in general — it is, as Senator Connor rightly pointed out, one of the most regulated professions. There are many other professions which in the months and years ahead I am sure will be called on to be self-regulated in a way which they have not been so to date.

I am reliably informed that a chartered accountant is sent by the Law Society of Ireland to individual members every so often and that it is intended to increase the frequency of such visits. The operation of such a practice in other professions dealing with large amounts of money should be recommended given the examples in the public arena recently. I am not saying the legal profession is out of control, quite the contrary. The degree of self-regulation is intense and ongoing.

I welcome the provisions in the Bill, principally in section 1. It takes up most of the Bill and is the most important section in that its provisions prohibit advertising by solicitors of a kind which is likely to bring the solicitors profession into disrepute. Equally, it prohibits advertising which is deemed to be in bad taste. The section encompasses a wide range of practices currently in operation by a tiny minority, such as advertising containing an expression or an implied assertion of specialist knowledge in any area of law or practice which is superior to that of other solicitors. There is no doubt that has come through in even the few examples to which I referred. The section specifically targets false or misleading advertising and equally confronts the practice of advertising by solicitors which expressly or impliedly refers to claims or possible claims for damages for personal injuries, the possible outcome of such claims or the provision of legal services in connection to such claims.

One of the most serious charges levelled against solicitors who are most prominent in personal injuries cases was that their advertising solicited individuals — again, the example exists — or groups to makes such claims. The soliciting was alleged to have taken the form of encouragement of inducements, such as no foal, no fee, to which I did not refer but which is also quite common. The Bill now prohibits advertising which expressly or impliedly solicits encourages or offers any inducement to any person or group to make such claims. Subsection (3) describes the information which may be contained in solicitors' publicity and the Minister referred in detail to the information which may be legally provided.

Since the solicitor's profession has a self-regulatory body, the Minister rightly requires the Law Society of Ireland to make the regulations, with his consent, to give effect to the subsections dealing with permitted information which is appropriate. The permitted information referred to here is information to be used in advertising. I agree with the Minister's approach in so far as it is practical and possible that this code of regulations should be self-directed, self-monitored and policed subject to the Minister's overriding authority.

The Bill before us is timely and is designed carefully in full consultation with the regulatory body of the profession with which it deals. The provisions for stricter controls in advertising by solicitors were urgently needed to address the need for a re-evaluation of the code of ethics and practice by which solicitors operate in terms of advertising in a society with a spiralling compensation culture. The Minister has got the balance right in setting down a fair and reasonable set of statutory guiding principles and regulations in his role as the guardian of the interest of the public good while at the same time upholding and respecting the professional rights of solicitors as well as their professional responsibility to society. The Minister must try to ensure that the courts are not duped into awarding what is improperly referred to as "free money" to bogus claimants or excessive compensation in genuine cases. We are all aware that such money is far from free because society and the taxpayer ultimately end up paying the piper.

Dr. Henry

The Minister has received a great welcome for the Bill and it appears the legal profession has also welcomed it. However, he will receive an even greater welcome for it from the medical profession. While I do not suggest that the ability of solicitors to advertise has in any way influenced the dramatic increase in the number of medical negligence cases that have come before the courts, it must be accepted that there is some correlation. The increase has been dramatic over the past ten years during which time advertising for personal injury cases has been allowed.

There is no point in the medical and legal profession blaming each other for the vast increase in medical negligence cases. There was enough trouble in that regard in the spring when the former Attorney General, Mr. Harry Whelehan, who practises at the Bar and specialises in personal injury cases, said at the annual general meeting of the Irish Medical Organisation in Killarney that the medical profession was the cause of its own problems. He said it was not that the profession treated patients badly, but that medical professionals made such bad witnesses in court. However, when one attends court as a witness, one is supposed to be objective and give the facts as one views them. It would be a great pity if expert medical witnesses who have been specially groomed for cases arrived on the scene in Ireland. There is much concern already that some doctors tend to be always on the side of the insurance company and others tend to be always on the side of the plaintiff.

The Minister for Health and Children will have told the Minister about the enormous cost to his Department of the changes in medical negligence cases. Approximately 15 years ago, I paid £40 a year for medical protection. I now pay £7,000 a year and my payments are low because I am a physician. My medical colleagues who are anaesthetists and surgeons pay £14,000 and £18,000, while obstetricians pay between £34,000 and £36,000. These are staggering increases. The Department of Health and Children must bear the bill for the large number of doctors it employs. It must pay approximately 80 per cent of their medical indemnity costs and this costs the Department over £20 million a year.

It appears one section of the Department of Health and Children is constantly trying to find ways of lowering the cost of medical insurance and considering whether there should be a State indemnity scheme or a no fault claims scheme as operates in New Zealand and Sweden. A massive amount of time and effort is being put into this difficult area. However, it is not only a matter of the £20 million cost to the Department, a sum which would have easily met the overrun on the cost of the new hospital in Tallaght. There is also the cost of the insurance which must be paid by hospitals. This involves vast amounts of money. For example, 5 per cent of the running costs of hospitals can be attributed to the insurance costs which must be met. The sums involved are staggering.

In addition, there is the cost of defensive medicine. Doctors are so worried about litigation that many more investigations are carried out than would be done usually. Patients do not realise that some of these investigations may have a risk attached. They may end up having more risks taken with their lives because doctors are worried about the possibility of litigation if he or she does not carry out every possible test while patients are in hospital. This involves huge sums. There is also the cost of the medical profession's time that is taken up in the preparation of reports. This also applies to administrators. The total bill is an astronomical sum which the State must bear at present.

This has only evolved in the past ten to 15 years. At present, the chances of a medical practitioner being sued are four times greater in Ireland than in the United Kingdom. I do not consider that the standard of medicine is so much lower in Ireland that medical professionals are four times more likely to be sued. I wish to stress this point because people do not realise that the vast majority of medical negligence claims fail. All people see are the claims which are reported in the newspapers and succeed. The vast majority of claims fail. Unfortunately, a considerable number receive some form of compensation which may not be entirely deserving as a result of cases being settled on the steps of the courthouse. As Senator Fitzgerald said, this often acts as a pour encourager les autres because if certain cases get into court and small amounts of money are awarded, medical negligence cases will be viewed as a possibility of securing a few thousand pounds. People with relatively minor problems may feel that they can get something.

I do not want people to think that I do not believe people who have had some wrong done to them by anybody in the medical profession should be recompensed. They should be compensated and perhaps we have been at fault in making too great a claim about what we can do for people. However, I am glad the Bill has been introduced because it may help redress this serious situation. It is not only serious in financial terms, but also because of the loss of time involved. Another aspect which is not stressed is that it is serious for people who take cases. It is run of the mill for solicitors to bring cases before the courts, but I was impressed by the statement made by Mrs. Quinlan, who, instead of going to the hepatitis C tribunal, took her case to the courts. It was suggested that she received £600,000 but she said the stress of the court case was enormous.

When the hepatitis C problem, which involved the serious injury of people, was discussed in the House, I said repeatedly that I hoped a tribunal would be established because I have seen the stress caused to patients who took cases before the courts. This aspect is underestimated as is the stress caused to the doctors involved. Anybody who has been involved in medical litigation, even where they were found not to have been at fault in any way, has found it extraordinarily stressful. In addition, in cases where doctors were found not to have been negligent in any way, it often has had a serious effect on their practices. This may be one of the reasons they are so keen to ensure cases do not come before the courts.

We must take note of the advice of professional bodies to the Oireachtas, such as that given ten years ago when the Law Society was so unenthusiastic about people being allowed to advertise. I am sure the Minister does not have time to read such items as Medical Council reports. However, the profession has asked the Medical Council to continue the ban on advertising by doctors. It has also asked that advertising by clinics should be more carefully controlled. The expectations we create for patients may be too great. However, the Bill will receive a great welcome from the medical profession, given the amount of time it spends discussing risk management rather than running clinics. I congratulate the Minister on bringing it before the House.

Miss Quill

I welcome the Minister to the House — his output is very impressive and we are glad this Bill is being initiated in this House. I hope that this legislation will be enacted with the minimum delay. It is essential legislation which seeks to address loopholes left when, with the best will in the world, politicians attempted to address this issue ten years ago.

My understanding is that the legal arrangement to allow solicitors advertise was made on foot of a report by the Fair Trade Commission in 1990. The philosophy behind that report was that it would be beneficial to seek to address restrictive practices within that profession. It was felt that consumers would benefit if advertising were allowed as it would facilitate competition in the profession.

I was a Member of the Dáil when the previous legislation was passed, and the Law Society was the body which set out the regulations on which section 71 of the Act was based. Perhaps with a little more foresight and insight, the regulations might have been framed so as to avert many of the excesses we are seeking to address in this Bill. Politicians requested the Law Society to draft the regulations. They also requested the society to be the arbiters of those regulations and to monitor and police their application.

It is easy to be wise after the event. However, with the number of new solicitors and the competition for business, it might have been fair to anticipate that the ambulance-chasing culture which emerged could have been averted by better regulations. I hope that this Bill will be enacted quickly and that the regulations which will ensue will be strong enough to curb this practice. I also hope that they will be well monitored and policed, and that legislators will not have to revisit this issue.

Senator Henry gave us some very valuable insights and it is important that we have the benefit of the experience of the medical profession as so described. She has given us an insight into what is happening as a result of the gross excesses of a small number of solicitors. These people are seeking to exploit and to fan the flames of a compensation culture which has become a creeping paralysis. We are referring to a small section of the profession, but that section is poisoning the public's estimation of the entire profession. That is why we must seek to stamp out this bad practice.

We must always remind ourselves that the first victims of the compensation culture are the young, the sick, the poor and the weakest sections of society. Compliant taxpayers pays taxes in the belief that they are paying for better public services — better health and education services and better care in the community for the old, the sick and the disabled. It is galling and stomach churning to see so much of our money going to people who are clever enough to exploit a number of situations and who are filling their pockets by way of fraudulent claims.

We have heard this morning that as much as 20 per cent of claims against health boards are fraudulent. Moneys which health boards ought to have to look after the sick and the less well off are being siphoned off to meet these claims. This practice is being underpinned by the small number of solicitors whose behaviour we are seeking to address. This behaviour should not be acceptable. Assisted by the media, we should seek to generate public revulsion at this practice. No matter how tightly they are framed, laws and regulations will not succeed in fully stamping out this practice which is robbing needy people of their rights and preventing the taxpayer from getting value for money.

Local authorities are seen as soft targets. There seems to be a belief, even among the Judiciary, that if the local authority is the defendant then it is no one's money. That is not the case — it is everyone's money. It is the money paid by the compliant householder who is prepared to pay service and other charges, or whose parents paid their rates. This money is not paid to fill the pockets of those who have no standards or sense of honesty and who are committing daylight robbery. They are being assisted in this practice and this should not be allowed.

Politicians should be at one where this practice is concerned. I am glad that this Bill has given us an opportunity to express our feelings on this issue. Senator Farrell has rightly called for a wider debate on the compensation culture. Unless we successfully confront this culture, which has become a growth industry, millions of pounds of taxpayers' money will be siphoned off. Money which should be spent on the common good will be siphoned off into the pockets of private individuals. No country allows that to happen and we should not do so.

I reached the pinnacle of disgust when an elected member of Cork Corporation sued the authority for an alleged fall on the steps of the City Hall. The amount of money won in an out of court settlement has not been disclosed, but it was between £40,000 and £50,000. One thousand people use those steps every day. City Hall was opened by Eamon de Valera in 1936 and no one has ever fallen on its steps. I have seen women bringing prams up those steps when paying water rates and no one has ever fallen until this elected member did so. It is time we did our sums and pointed out to these people that such an amount of money could fill a children's bookshelf in a public library.

Mr. L. Fitzgerald

The man in question may fall down the steps again next June.

Miss Quill

The Senator would be surprised. The man is always talking about home helps and the amount awarded to him could be used to pay them an additional £1 per hour.

A good deal has been said about advertising which has been gross in the strictest meaning of the word. Huge deception has been visited on people who, it must be said, left themselves wide open to deception. Not alone are the advertisements gross, the practice of touting for business is even more so. Will this Bill serve to halt that? Some solicitors, albeit a small number, have visited Army barracks and people's homes and implanted the seed in their minds that they had somehow suffered an impairment and should make a claim. Many of these people are no longer serving members of the Defence Forces and it would never in a hundred years have occurred to them they had suffered an impairment. If they experienced deafness, they would, as I myself do, have assumed it was old age catching up with them. Solicitors gave people the impression that a honey pot existed and offered to hold their hands and take them to it. That is the lowest form of public practice. The Minister made reference to the regulations which will emerge from this legislation but I would like him to confirm that this worst form of advertising will be stamped out as soon as possible and the practice of touting halted. Touting for business is even more insidious than placing ads in the Golden Pages or at the back of newspapers.

I compliment the Minister for introducing this legislation which I hope will deal effectively and conclusively with this issue which was the unintended outcome of the legislation we are seeking to amend. To say the advertisements and touting are in bad taste is very charitable; their effect on public morality is very serious and corrosive. These practices are causing money voted in these Houses, provided by compliant taxpayers for the provision of decent public services, to be plundered.

The Law Society does its best and any criticism I make is not of it as a body but of a very small number of solicitors with whom I hope the society will deal with conviction and speed and without mercy.

Mr. Cosgrave

I welcome the Minister. Fine Gael supports this Bill. It is important that we maintain a balanced view in this debate. As previous speakers stated, we are trying to address the actions of a few members of the Law Society, although not an insignificant number given the amount of money involved. I am a solicitor and have a vested interest in this legislation, which deals with advertising and ensuring that the standards of the profession are maintained.

It is fair to say that following the introduction of legislation some years ago, some members of the profession indulged in inappropriate advertising. I have photocopies of entries in the Golden Pages for the Dublin area and some of the ads are quite glossy and provocative. Some almost suggest that if one has not yet had an accident, one should consider having one. Some ads invite people to make an initial phone call to avail of a free consultation. One states that the firm will post out its compensation claim brochure to prospective clients, another that a hospital visit can be arranged. I am sure that, in the casualty departments of city hospitals today, several solicitors are sitting waiting to see what comes in in the next ambulance.

There is room for improvement in the profession, a fact which the Law Society recognises. However, it is important to recognise that this legislation is being aimed at a few so-called ambulance chasers and others who are trying to stir up business in an inappropriate or tasteless fashion. There are people other than solicitors involved in the claims culture, namely, insurance companies, local authorities, health boards, the medical profession and the courts system.

Last weekend I was canvassing in Cork and as I travelled down a particular road I noticed that some stone slabs had been broken off or left on the road. I moved one to what I considered to be a more appropriate position. A woman came out of her house and told me that attempts had been made to get something done about that for the previous ten days but nothing had happened. We should not wait for a by-election to address these matters. People should be employed in local authorities to sort out these kinds of problems before an accident occurs. Local authorities have a duty to address complaints, particularly serious ones. It would not have required much time or effort for someone to move these slabs; the problem could probably have been sorted out within 20 minutes.

Another issue in which I am interested relates to the manner in which insurance companies fight these cases. I know of cases where a car has run into the back of another car, with four occupants, and caused £100 worth of damage to the car in front. The following day the four people have stiff necks and are wearing neck collars. It should be obvious if cases should be investigated or fought harder in the courts rather than letting the costs to the insurance company multiply. Some insurance companies must put greater effort and research into investigating claims.

If somebody is involved in a bad accident, whether at work or in a car crash, they are entitled by law to compensation for general damages for loss arising out of the accident and special damages for out-of pocket expenses or loss of earnings. Insurance companies are sometimes too willing and too quick to settle. Perhaps they should settle earlier in some cases if it is clear they have a liability. Many plaintiffs are happy to settle quickly if the action is valid.

On the compensation culture, years ago if a person slipped in a pub or a supermarket he would pick himself up and hope his fall had not been noticed. Now a person lies there thinking about what is in it for him. I am sure Senator Quinn is well aware of this. Civil liability insurance is killing many organisations; they are afraid to hold small charity events, shows, gymkhanas or outings because of the risk of crippling costs.

I hope this legislation will work and that it is targeted appropriately. Many solicitors do not engage in this practice. Some solicitors take on cases on a no foal, no fee basis, but they must look for the facts and listen to the other side of the story. I know cases where a client has said something happened and later discovered that it was not that simple and that witnesses disagreed with him. Perhaps solicitors will have to tell some clients that their claims are dubious.

This legislation is partly a knee-jerk reaction to the Defence Forces claims and how they have been handled. They have not been handled well. Members of the Defence Forces who have genuine claims and have suffered deserve compensation. However, there are obviously others who are pursuing claims simply to provide a new conservatory or to furnish a new kitchen. We have to examine this. It is a serious matter for the Government.

I ask the Minister to take my points on board. There are other aspects in addition to advertising, such as the way in which cases are handled, which must be examined. There are probably cases which should be fought in the courts. Some judges are apt to see a potential Oscar Wilde in the witness box who is lying through his teeth.

We will support this legislation. We may have amendments on Committee Stage but in general we are in agreement with it.

Mr. Farrell

I welcome this Bill which is intended to catch the 2 or 3 per cent in the legal profession who engage in this practice. The majority of the legal profession are honest hard working people but there is a small percentage who are not. That is obvious when a person will travel 70 miles to a solicitor who is known for his ability to win compensation cases. If that client wanted to sell a piece of land he would not drive from Letterkenny to Sligo to get a solicitor. He would find one in his own town. People will travel long journeys to a solicitor with a reputation for being able to win compensation cases.

Advertising is just one issue. When building a road the contractors and local authorities must take necessary precautions. During the week I saw a case where someone, while under the influence of alcohol, went through tape warning people not to enter but the judge held that the tape was not substantial enough and the person won the case.

When I ran a business — a filling station, garage, auctioneers and restaurant — in the 1960s and early 1970s my public liability insurance was £20. Today my daughter runs part of that business and my son runs another section. Their joint public liability insurance is more than £2,000. Admittedly, the business is bigger than it was in my time but the premium should not have gone from £20 to more than £2,000. That is a colossal figure. Public liability insurance for the little restaurant costs £500. People have been going in and out the door of the restaurant since 1964. Recently a lady tripped there. I went out and asked if I should call a doctor. She replied that she did not need one as there was nothing wrong with her and she walked away. However, she left Letterkenny and went to Sligo to get a solicitor. The assessors stated there was nothing wrong with the door but the insurance company awarded her £10,000. As a result our public liability insurance premium will be increased. Insurance companies do not lose money by settling claims. It is a selling point that they settle compensation cases quickly rather than dragging them through the courts. They pay up and smile. Why not when they then increase the premium? It goes up every year.

This is also a problem for the medical profession. I have no doubt that our waiting lists are solely the cause of compensation claims. When Fine Gael was in Government they spent £14 million to get rid of the waiting lists and Fianna Fáil spent £17 million when it came into Government.

Mr. Connor

It spent £7 million.

Mr. Farrell

The amount is colossal whatever the figures but the waiting lists have not disappeared. Where is the black hole? I believe it is explained by the compensation culture. It is at the stage where somebody getting a thorn out of their finger must go from their local doctor to the accident and emergency department of a hospital and from there to a consultant. This is followed by a full range of tests for everything because of the fear of being sued. Indirectly the compensation culture is costing millions of pounds and something must be done.

I have been driving a car for 50 years and I have never had an accident. However, I have seen crashes, and the first thing people say is "Thank God nobody has been injured". Responsibility was sorted out between the parties, either 50:50 or otherwise. If necessary a garda would arrive on his bicycle and tell the parties that they should settle the matter among themselves. That is the way it was done. As Senator Cosgrave said, the situation has now changed, even when somebody only touches the back of another car. I know a politician who was pulling up at a crossroads and barely touched the car in front of him. A young lad of about 12 or 14 years of age jumped out of the back of the car saying "Daddy, daddy, I have whiplash". That boy will be brilliant when he is 20 years of age.

Mr. Quinn

And wealthy.

Mr. Farrell

And wealthy. This is what is happening. The situation develops where two medical practitioners will argue among themselves as to who is right. A case brought before one court will result in a judge giving one decision. However, on appeal another judge — all judges come from the same law school, were educated by the same professors and read the same legal books — will overturn an earlier judgment. In today's paper there is an example of somebody who killed a person and who successfully appealed a six month jail sentence. What is happening in the context of judges? What is wrong with the system that no two judges can make up their mind as to what is right and wrong? The issue of interpretation is becoming serious.

Recently it has come to light that a very large percentage of claims, perhaps 60 per cent or more, are made by travellers and the unemployed. How come this section of the community seems to make more claims than anybody else? The figure was in the papers over the past week. Is it not time to do a survey?

Publicans, to prevent drunk driving, decided to run courtesy buses to take people home after functions. However, following a case which was settled out of court and which sets a precedent, a bus driver can be in trouble unless he makes sure passengers are linked home, brought into the house and put to bed with their heads sufficiently high enough with pillows to ensure that if they get sick they cannot smother or suffer any problems. The publican who employs the bus driver can also be in trouble. Members might think what I am saying in farcical, but this is the stage things have reached.

Mr. Connor

It is funny but true.

Mr. Farrell

Where will things end with "compo culture"? Rural Ireland is bad enough with the loss of people. Shows which took place in the past cannot be run now because insurance has become very high and one cannot afford to take chances. In many cases sports days which were run for children cannot be run anymore as chances cannot be taken.

It puzzles me how somebody who trips and falls on a street, road or steps where thousands of people have travelled, without proving there was anything unusual, can go to court or settle out of court and receive a lump of money. Where does personal responsibility end and third party responsibility begin? We all have eyes and ears and should be able to see where we are going and if there is something on the road. Will we get to the stage where a man will be able to run somebody down and say he did not see the person as they were not sufficiently lit up? Why can people not see obstacles? Why is it necessary to be so clear on everything?

Two or three years ago there was a case where somebody slipped in a supermarket on some mineral which a child spilt on the floor. How can the owners of a supermarket or shop be watching the floor night, noon and morning for a sweet paper, a drop of mineral or a bit of ice-cream on the floor? Where does personal responsibility kick in? It is time we considered introducing personal insurance and making it compulsory for everybody. It could then be decided whether payments should be made from personal insurance or third party insurance. At least people would be contributing and if personal insurance became expensive people might realise what is happening. We must do something to remind people that they have personal responsibility.

This also applies to a person taking up a job. When politicians look for a few bob increase in people's wages we are told that the person knew what the job was like when they took it up. However, in the case of people in the Army, the Garda or Civil Service we see that any developing hearing problem as a result of old age is caused by the job and that they are entitled to compensation.

This is a good Bill but is only a start. The very few solicitors whose activities will be curbed by the Bill may be the catalyst for the compensation culture, but there is a whole big section that must be examined. A law must be introduced concerning personal responsibility. Seven years ago I fell and injured my back. I was in hospital for nearly three months and could not swing a golf club for two years. However, I never looked for compensation as my attitude was that it was my own fault and that I should have been more careful. Somebody must do something about people running for compensation at every turn. Otherwise, there will be no businesses as they will not be able to pay insurance premiums which are becoming more expensive. Neither will voluntary groups be able to do anything.

I welcome the Bill as a first step and I give it my full support. However, the Minister will have to return to the House with a further Bill defining personal and third party responsibility.

Mr. Quinn

I wish to share time with Senator Norris. I welcome the Minister. In his speech he said "This Bill is a response to a growing concern about the excesses of advertising by some solicitors, particularly in the area of personal injuries". This is the basis of the Bill. Had I been here some nine years ago when the legislation was passed by the House I would have been wearing a free market hat and said I welcomed the removal of restrictions on solicitors' advertising. In the consumer interest I would have encouraged the ability of solicitors to advertise. I welcome the Bill as I have changed my mind on the same basis as the Minister has explained in his speech.

I will not solve problems today, but I wish to give an example of what can happen. Senator Farrell spoke about somebody falling on a supermarket floor. There was an incident in one of our supermarkets some time ago where a customer slipped on the floor and hurt herself. She sued the company but lost the case as we were able to prove we had a cleaning programme, that we had trained people how to clean and that a process and system for ensuring cleanliness as best we could existed. However, we could not guarantee that if a banana skin fell on the floor it would be picked up every two minutes. The judge took the view that our company had done what could be reasonably expected of it in this regard and found that our company was not negligent. The claimant lost the case and it cost her a lot of money. She then came back and asked, as a good customer, to be helped out with her costs. We were not all that sympathetic. I say this because I do not think it is understood that the vast majority of medical claims are lost. The high profile cases are the ones that are won.

There is an onus of proof of negligence in order to win a case. It worries me that this is not understood and that these "ambulance chasers" and agents provocateurs encourage people to take these cases. These solicitors are not acting in the consumers' interest, they are encouraging consumers to take action because they believe they can win even though there is no negligence involved. I am concerned because in some high profile cases the question of negligence does not appear in newspaper reports. So it appears there was no negligence, yet an award was made.

I will instance a case which happened some time ago. A customer came into one of our supermarkets on a busy Hallowe'en week-end, another customer's trolley was knocked over and broke the customer's toe. The customer then went to court and sued our company for the injury she received. We defended the case because our trolley had not been out of order, the trolley was found to be in a perfect state and the floor of the supermarket was in a perfect state. Yet this woman had come into the supermarket in the whole of her health, left with a broken toe, obviously needed to get help to mind her children, had medical expenses etc. and she, therefore, assumed she could sue. She was encouraged to do so by her solicitor. While recounting that story, I often ask people how much would they have given her and they have mentioned various amounts. In fact, she lost the case; she got nothing.

I did not understand this because it seemed to me that she came into the supermarket in the whole of her health, she left with a broken toe, she was out of action for a week or two and it seemed to me that she deserved something until I understood the law, which said that she had to find someone negligent. In this case the owner of the supermarket or the owner of the supermarket trolley was not proved negligent; therefore, she won nothing. A baby's pram was brought into court and the court was told that it was possible to knock over a baby's pram, that if one put a foot on the pram it would be possible to knock it over. The case was made that if the owner of the supermarket were to be found guilty of negligence every mother who ever wheeled a pram could also be found guilty of negligence. On that basis the supermarket was not found guilty and the claimant received nothing.

I tell this story because I do not think these messages ever reach the newspapers or the claimants. The law as it stands says you must prove negligence. I support the concerns of Senator Farrell because it seems to me that the cases that are won often do not seem to prove negligence; there seems to be sympathy somewhere along the line that if someone has been injured they deserve some compensation. Let us remember that every time someone who is not negligent is blamed and made to pay, one is putting up costs for every citizen in the State.

I welcome the Bill because it puts the onus of responsibility on the Law Society as the regulatory body for solicitors to come up with their own regulations in this regard. This goes against what I would have said ten years ago when the original Bill was introduced. I now support this change and I welcome the Minister and the Bill.

Mr. Norris

I do not have a great deal to add to what has already been said. There has been a general welcome for this Bill and I join in that welcome. By and large, we are well served by the legal profession. I say this with some expertise because I am a particularly litigious person; in fact, I am known as the "lawyer's friend" because of my eagerness in attending the courts. After all, it is real drama and, unlike the operas or the theatre festival, for one performance only and the issues are real and serious. I also welcome the Bill because at the beginning of the Army deafness debate in this House I suggested that the question of advertising by solicitors was an element that should be looked at. It was perfectly clear to me that solicitors were beginning to tout for business in a remarkable way. This was not just advertising in the Yellow Pages, I heard these advertisements on the radio on the basis of “Come in with your complaint and we will see”, “No foal, no fee”, and “We specialise in getting compensation”. These were key words. We cannot entirely blame members of the public for being tempted by the allure of the notion of large claims. After all, people are human and if they have been injured they may well be induced to take cases in circumstances where they might otherwise not wish to do so.

May I say, before I criticise the compensation culture too much, that I benefited from it a number of years ago. I had an accident involving corporation roadworks which were unlit. I looked for compensation to the value of the damage done to my car. The corporation unwisely fought the case; I won and was awarded £11,000. The corporation appealed and the award was reduced to approximately £7,000, but the accumulated legal costs involved were far greater than the difference between the original award. If they had accepted my suggestion that they should pay for the repairs to the car it would have cost them a fraction of the final cost.

I was the beneficiary of a situation in which I had not engaged with the intention of profiting against the corporation. In fact, that case established a precedent. The corporation had removed a night watchman because he was being tortured by the local blackguards and was not safe in his hut. So the corporation calmly abandoned the roadworks, the children stole the lights and I went slam into the roadworks. Before I take any great smacks at the compensation culture, I should say that I have been in the position of receiving compensation. However, there were other occasions in which I deliberately chose not to take action because I believe that we are in a situation where life is being made difficult by the proliferation of these vexatious actions for damages. I am not sure if the Minister finds time to listen to the radio while driving from one point to another. He may have had the opportunity to listen to Marian Finucane in the last few days when a series of incidents were put on the record regarding the forecourt of a petrol station. It involved a heavily pregnant woman coming in a large car and needing someone to help her change the tyre in the car. When a young lad did help her to change it — although he did not want to — the jack collapsed, there was some small damage to the door of the Mercedes, she got to hospital or wherever she was going and got the car repaired, but the owner of the garage was held to be responsible. Her husband told him that he had him in a corner, there was nothing he could do about it and that he was legally responsible. He would not even allow the garage owner to make the small repairs necessary to the car; he insisted on it being sent to the main Mercedes dealer. The repair, therefore, cost about £900.

The programme discussion arose after a caller rang to complain that when she went to the forecourt of a petrol station nobody, not even the proprietor, would help her change the tyre on her car. That is how society has evolved as a result of a compensation culture.

It was also reported in recent days that a man in Cork was awarded £100,000 compensation for being allowed to drive his car while drunk. He hit an obstacle and is now paralysed. It is a sad situation but one wonders about the degree of responsibility on the individual to look after him or herself. I accept that publicans should have an obligation not to serve a customer who is obviously blind drunk. However, I am not sure that a publican can be expected to watch over every individual in a crowded pub who is committed to getting drunk and to driving their car. We are in an extraordinary situation with regard to compensation claims.

It gives a slightly new twist to the word "solicitor" because they appear to be soliciting not the courts but their clients. I am reminded of the story about the lady of the night whose beat was St. Stephen's Green in the 19th century. She approached an elderly gentleman and offered her services for a modest fee. He was rightly aghast at this notion and said: "Madam, do you know who I am? I am the Crown solicitor for Mayo". She replied: "What about it? Am I not the half crown solicitor from St. Stephen's Green?" Unfortunately, we appear to have quite a few of these half crown solicitors in the legal profession at present.

I was impressed by the contributions of Senators who are professionally qualified in this area, as is the Minister. They clearly have committed themselves to taking action against rogue elements in their profession. The Minister spoke about subsection (2) in the context of the control of advertising, which prohibits solicitors from publishing or causing to publish advertisements under various categories. The last category is where the advertisement is "contrary to public policy". That is a vague, catch all phrase. Perhaps the Minister would explain it. Does it apply if the party interests of the Government were threatened by an advertisement, for example, if an advertisement stated that the solicitors handled certain cases and the Government was anxious to minimise such cases? What constitutes "public policy" in this context? The phrase worries me a little although the Minister might be able to give the House an adequate explanation for it.

The Minister also said that the 1988 regulations allowed solicitors to advertise but prohibited advertising which was in bad taste, false or misleading, claimed specialist knowledge or superior quality of service over other solicitors or was critical of other solicitors. I would not object to them being critical of other solicitors. In fact, it might be fun to read advertisements if they contained such information.

Were the regulations monitored? Was a report or analysis produced? Since 1988 the regulations prohibited certain types of advertising but did the Law Society or anybody else in the profession monitor the advertisements? Senator Cosgrave, for example, quoted a number of advertisements from the Golden Pages which were clearly in contravention of the regulations. What monitoring procedure was in place? These advertisements should have been spotted and prohibited but they were not.

Mr. Costello

I welcome the legislation and the fact that there will be strict controls on advertising by solicitors. The legislation covers a broad range of areas including bad taste, anything that is likely to bring the solicitors' profession into disrepute, anything that reflects unfavourably on other solicitors — whatever that means — anything that contains an expression or assertion of specialist knowledge in an area of practice, false or misleading advertisements and advertisements that are contrary to public policy. It also contains provisions in respect of advertisements regarding personal injury claims.

There are probably two reasons for introducing this legislation. The Bill deals with the profession in a general sense and seeks to ensure that the highest standards of the profession are maintained. The objective is that nothing should be advertised by a solicitor that would in any way undermine those standards. The Bill also prohibits advertisements relating to claims or possible claims for damages for personal injuries or containing any inducement to such actions being taken.

The latter is probably of greatest concern to the Minister. The steps taken by the Law Society, notably its professional code of conduct, are probably adequate to deal with these matters. "The Guide to Professional Conduct of Solicitors in Ireland" and the disciplinary tribunal of the society to deal with breaches of the code in respect of advertising and so forth by way of sanctions is the proper way to deal with this issue. One wonders what the Law Society had to say about the statutory measures in the Bill and to what extent it believes it can police its own profession adequately in this area.

The thrust of this legislation is to deal with the issue of claims for damages for personal injuries. I agree that the legal profession should not engage in ambulance chasing or unseemly trawling through the media to chase down useful or financially beneficial claims that might be made in the courts. However, this measure is being introduced largely because of the problems being experienced by the Minister's colleague, the Minister for Defence, Deputy Smith. He is having huge problems with the legal profession and the Minister for Justice, Equality and Law Reform appears to be doing him a good turn by introducing legislation which targets the legal profession, a profession which, his colleague believes, has abused its position in respect of the Army deafness claims.

I am not sure that it is good to introduce legislation to deal with a specific area that is seen to be a problem by one person. The Minister for Defence is on record as saying that the legal profession has been at fault in the manner in which it has pursued these claims. He also said the Judiciary was at fault. Regardless of whether there is truth in his criticisms, it should be remembered that the Army deafness claims have shown there was gross negligence by the authorities in allowing the situation to continue over a number of decades. This led to generations of soldiers having their health damaged.

The legal profession can only operate within law. While certain members of the profession are in receipt of large sums of money following Army deafness cases, they are pursuing legitimate cases in legal terms. We may not be happy with the manner in which the process is taking place, the amount of damages being granted, some of the decisions of the Judiciary or certain members of the profession having a large number of cases and becoming very rich as a result. We were not happy with the way the tribunals operated where barristers were the main beneficiaries and they made fortunes. It showed in many ways that we were at fault for the way we had carried out our business in establishing legal structures.

I hope solicitor bashing does not result because over the years they did not seek wide ranging access to advertising for their products. It is not something for which they have been responsible. They did not make the request that opened the gates to large scale advertising. Will the Minister comment on the background to this legislation? Hard cases make bad law. I am concerned that this Bill has come about as a result of a specific issue in another Department and it is only for that reason that it has been introduced.

If the Minister is prepared to argue that is not the reason, will he provide an audit of cases where severe abuses or breaches of the code of practice of solicitors have been experienced? What level of complaints is received by the Law Society? Has its disciplinary tribunal dealt with any breaches? How many complaints does it receive annually? Occasionally, we hear of cases involving substantial fines and in one case an individual who had been in breach of the code of practice was struck off the register.

I support the legislation given that any right minded person would not want to see a profession brought into disrepute. My only concern is that it has been introduced for one specific reason. What serious breaches brought this issue to the Minister's attention? Why is he concerned that strict controls on advertising are put in statutory form?

Minister for Justice, Equality and Law Reform (Mr. O'Donoghue)

I thank all who contributed. I greatly appreciate the general welcome given to the Bill and the constructive approach to the debate. In my introductory remarks I indicated that the main purpose of the Bill is to provide stricter controls on advertising by solicitors, particularly in the area of personal injuries. It is intended to ensure that the nature of the advertising engaged in by them is appropriate, not in bad taste, objectionable or of a nature which induces persons to engage in litigation unnecessarily.

While the Bill imposes controls on the nature of solicitors' advertising it does not aim to prohibit it. Indeed, it sets out what may be contained in such advertising to ensure that members of the public can be made fully aware in a clear and unambiguous manner of the full range of services solicitors provide. It is unfortunate that since the Law Society changed its rules on advertising in 1988 a minority of solicitors have engaged in forms of advertising which are unacceptable. I am determined to put an end to these objectionable and misleading forms of advertising, particularly in the area of personal injuries.

A number of issues were raised by Senators which I wish to address. Senator Connor referred to the lengthy debate in the solicitor profession on whether they should be allowed to advertise. I indicated in my introduction to the debate that the Law Society had given a warm welcome to this Bill. However, I am conscious that not all members of the profession are in agreement on the question of advertising. It should be remembered that such advertising was banned until 1988 when the society introduced new regulations which allowed solicitors to advertise under certain conditions.

The decision by the society to change its policy was not taken lightly. For many years advertising had been the subject of serious and heated debate within the profession and support for and against it was finely balanced. In an effort to resolve the issue a working party of the council of the society was set up in 1986 to examine the matter in detail. While it proposed that solicitors should be allowed to advertise under certain conditions the proposal was rejected by a majority of almost two to one when presented to the 1986 AGM of the society. Following further examination and refinement of the proposal the society put it to postal ballot of all its members in October 1988. The ballot resulted in a narrow majority in favour of allowing advertising. As a result advertising regulations were made by the society. It was very anxious in bringing them forward to ensure that the form of advertising in which solicitors engaged was appropriate and would not bring the profession into disrepute.

Consequently, while the 1988 regulations allowed solicitors to advertise they also prohibited advertising which was in bad taste, false or misleading, claimed specialist knowledge or superior quality of service or was critical of other solicitors. It is unfortunate that some solicitors engage in advertising which is a blatant flouting of the profession's rules. Senator Costello and others are correct in that this accusation does not apply in the majority of cases but, unfortunately, it does in some. The profession itself has expressed concern at the unacceptable nature of the advertising in which some of its members engage.

During a submission on Army hearing loss cases by the Law Society to the Oireachtas Committee on Public Accounts on 4 February 1998 the society indicated that it considered certain forms of advertising being engaged in by some solicitors as "undesirable". When pressed about what action it had taken to ensure that solicitors complied with the provisions of its advertising regulations and to prevent them from engaging in undesirable forms of advertising the society replied that it had taken counsel's opinion as to whether it would be supported in the courts if its proposals to ban a particular advertisement were challenged by a judicial review, as it believed they would be.

It was advised that it would not be supported in the court and that the judicial review would succeed. That is the context in which the society monitors advertising. When complaints are made, undertakings are extracted from solicitors' firms not to repeat those advertisements; that is how the system works. The society's position is that it wants this type of advertising banned by legislation.

I trust that that answers the queries posed by Senator Costello and others as to whether there is monitoring or analysis of advertisements. While preparing this Bill my Department had detailed discussions with the Law Society on the nature of the controls necessary and the difficulties the society encountered in the effective implementation of their 1996 advertising regulations. It is clear from the society's experience, on the basis of the legal advice available to it, that the imposition of controls on advertising solely by way of regulation is not effective in controlling proper advertising. I am satisfied that in order to put an end to the objectionable form of advertising a number of solicitors are engaging in, it is necessary to provide effective controls by way of legislation. That is why I am bringing this legislation forward. The regulations have not proven to be effective, but I believe the statute will be.

Senator Liam Fitzgerald stated correctly that the introduction of the 1988 regulations was a matter of what was perceived then as the right way to allow for competition within the profession. When the Law Society decided then to lift the ban on solicitors advertising and to introduce regulations to control the type of advertising solicitors could engage in, the Fair Trade Commission endorsed this approach. Its 1990 report on restrictive practices in the legal profession stated:

The 1988 regulations made by the Law Society which remove the prohibition on advertising by solicitors but which to some extent limit the content of advertisements are in broad agreement with the principles which are considered acceptable by the Commission. We commend the Law Society for the adoption of the new, more liberal regulations since we consider the previous restrictive regulations amounted to unfair practices which were not in accord with the common good.

The commission's views on advertising by professional bodies generally were considered carefully in the course of the preparation of this Bill. The commission's view is that the freedom to advertise goods and services is second in importance only to price competition in the effective operation of a competitive economy. It considers advertising to be an important stimulus to improving efficiency, to the introduction of innovative methods and as a primary means of ensuring there is effective price competition.

It is of fundamental importance that consumers are given accurate information regarding the availability of goods and services to make an optimum choice from alternatives. The commission feels that selection among competing suppliers or providers of services can be made properly only if information is available to consumers, who can then choose the most appropriate combination of price and quality.

Conversely, the commission believes that any prohibition or restriction on the freedom to advertise is a very serious limitation on competition and operates to the disadvantage of the consumer. The commission states that if consumers are not provided with knowledge of alternative suppliers or providers, they cannot exercise an informed choice, and without choice there can be no competition. It is clear from the commission's report that the question of advertising by professional bodies is about making appropriate information available to the public about the services the profession provides in order to ensure that the public is in a position to make an informed choice.

While the commission considers that restrictions on advertising of professional services is not in the interests of consumers, it recognises that the content of certain advertisements could bring a profession into disrepute or lead to loss of confidence in the profession or the individual practitioner. It is the commission's view, therefore, that there are grounds for allowing a degree of control in respect of the content of advertisements placed by members of professional organisations. This Bill introduces a comprehensive range of balanced measures which are designed to control objectionable advertising while at the same time ensuring that appropriate information on the services provided by the solicitor profession can be made available to the public in a manner which will operate to the mutual benefit of both consumer and profession.

Senator Fitzgerald also said correctly that the Bill does not seek to prevent legitimate claims for personal injuries. To suggest that this Bill is intended to reduce the number of claims for personal injuries is to draw the corresponding analogy that the purpose of advertising is to increase the number of claims for personal injury. The purpose of solicitors advertising is to provide useful information to members of the public and to promote competition between members of the legal profession. It is recognised by the Fair Trade Commission, the Law Society and others that the contents of certain advertisements can bring the solicitor profession into disrepute and lead to a loss of confidence in the profession. Therefore a balance has to be struck on the nature of advertising which is acceptable and which is not, and the Bill is about achieving that balance.

The Bill applies to solicitors advertising generally and not just in the area of personal injury. Even in the area of personal injury, the Bill makes clear that the words "personal injury" may be used in an advertisement, thus ensuring that potential clients for services in that area will be able to access those legal services and that solicitors who provide a service in that area will be able to canvass the public through advertisements.

Senator Norris asked what was meant by public policy and a question was also asked about the Bill's provision which prohibits advertising which is contrary to public policy. The use of the words "contrary to public policy" in our laws is of long standing and is to be found in a wide range of statutes. The notion of public policy is well established in common law and has been widely commented on by our courts in a wide range of decisions. The general principle in law is that a person will be not permitted to do that which has a tendency to be injurious to the public or against the public good. Certain acts are said to be contrary to public policy when the law refuses to recognise or enforce them on grounds that they are injurious to the interests of the State or community. This will be a matter for the courts to determine in the final analysis by reference to the particular circumstances of the case and whether a particular advertisement is contrary to public policy.

Senator Quill referred to touting for personal injuries. This is specifically prohibited under section 1(2)(i). I am sure the Senator is pleased to hear that.

Ambulance chasing was referred to by a number of Senators. It is a disgraceful practice. The definition in subsection (10) of "inappropriate location" is of considerable relevance and includes a hospital, clinic, doctor's surgery, funeral home or cemetery. Many people find it extraordinary that any solicitor would attempt to make a client the richest man in the graveyard. It is extraordinary but unfortunately in a limited number of cases, particularly where the deceased was the victim of an accident, it has been the experience that touting has taken place in such places.

With regard to the question of negligence, in general, Senator Quill is quite correct to point out that, because one breaks one's toe in a supermarket or anywhere else it does not automatically follow that such person is entitled to compensation. Negligence has to be proved based on the balance of probabilities. One is not automatically entitled to compensation because one is injured on another person's premises or a public road. The general rule is that if it could have been reasonably foreseen that such damage would be caused, then a question of negligence arises. Equally, if it could not have been reasonably foreseen then no question of negligence arises.

Senator Costello referred to the Army deafness cases. There are genuine claims and these must be dealt with fairly by the courts. There are also claims which may not be genuine. There is more than anecdotal evidence to suggest that the placing of disquieting advertisements in newspapers, etc. has led to people making claims they might not otherwise have made and that has led to a certain level of fraudulent claims.

It is my sincere wish that this legislation will strike the balance required — a balance between the right of the individual as against people being encouraged by advertisements of a disquieting kind, often put forward by a small minority of unscrupulous people, to bring claims which are not genuine.

I thank Senators for their very constructive contributions and look forward to debating the Bill further on Committee Stage.

Question put and agreed to.

Committee Stage ordered for Wednesday, 21 October 1998.

Sitting suspended at 1.25 p.m. and resumed at 2.30 p.m.

Seanad Éireann debate - Thursday, 15 Oct 1998

Solicitors (Amendment) Bill, 1998: Second Stage.

Seanad Éireann debate -
Thursday, 15 Oct 1998