REG/42227-2009
REGULATORY SETTLEMENT AGREEMENT
1. Mr David Lamb, Ms Kirsten Scott, Mr Mark Quigley (partners/former partner) of Beecham Peacock Solicitors, agree to the following outcome in connection with the Findings of a Forensic Investigation Report dated 1 May 2009.
References in this agreement to the Firm are references to Beecham Peacock Solicitors.
Background
2. Mr Lamb, Ms Scott and Mr Quigley were all equity partners at the Firm during the relevant period. Mr Quigley left the Firm in 2005.
3. At the relevant time the majority of the Firm’s work comprised of Personal Injury work. The management structure was such that each partner had responsibility for different areas of the practice and Mr Quigley was solely responsible for the supervision of Personal Injury matters.
4. All three partners received a profit share in relation to Personal Injury matters.
5. On 8 April 2008 the Solicitors Regulation Authority commenced an inspection at the Firm. A Report dated 11 May 2009 identified that:
Introductions and Referrals
5.1 From around September 2002 until March 2004 (the date from which the Solicitors Introduction and Referral Code 1990 was revised), 528 payments ranging from £35.00 to £300.00 and totalling £113,855.00 were made by the Firm to FreeClaim Plc, formerly Industrial Diseases Compensation Ltd (IDC).
5.2 For the above fee IDC prepared work histories, diagnosed asbestos cases and made application on behalf of client to the Department of Social Security (now known as the Department of Work and Pensions).
5.3 Post March 2004 the Firm paid referral fees to reflect the revised provisions of the Solicitors’ Introduction and Referral Code 1990.
5.4 Referrals obtained from IDC stopped in 2007.
Deductions
5.5 By virtue of individual agreements between clients and IDC, in successful claims dealt with under the relevant Claims Handling Agreements clients were liable to pay a settlement fee from their damages to IDC.
5.6 Prior to January 2004 deductions were made in 15 matters referred by IDC and full refunds totalling £2,446.60 have now been made to the clients by the Firm.
5.7 In response to national publicity relating to firms taking additional costs from miners’ compensation to pay introducers the partners decided in (approximately) January 2004 that the firm would discharge such clients’ liabilities from their own profit costs. No element of clients’ damages were paid to the Firm.
Findings
6. Mr Lamb, Ms Scott and Mr Quigley make, and the SRA accepts, the following admissions:
6.1 Mr Lamb, Ms Scott and Mr Quigley failed to comply with Rule 1 of the Solicitors Practice Rules 1990 by acting in a manner which impaired their duty to act in the best interests of clients. They failed to consider the terms of the agreement entered into between clients and Industrial Diseases Compensation Ltd (IDC) and the impact of the Claims Handling Agreements (CHA’s) on the charges made by IDC for their services following introduction of the CHA’s in 1999. The main basis for the agreement between IDC and their clients was to provide an indemnity against costs. This was illusory as following the introduction of CHA’s the claimants would not in any circumstances have been liable for legal costs.
6.2 Mr Lamb, Ms Scott and Mr Quigley failed to comply with Rules 1 of the Solicitors Practice Rules 1990 as by deducting success fees from damages and passing these to IDC failed to act in their clients’ best interests.
6.3 Mr Lamb, Ms Scott and Mr Quigley failed to comply with Rules 3 & 9 of the Solicitors Practice Rules 1990 and Sections 2 & 3 of the Solicitors’ Introduction and Referral Code 1990, as prior to March 2004 they acted in association with IDC, a claims assessor, part of whose business was to make, support or prosecute personal injury claims and who solicited or received contingency fees in respect of that business, and paid what was considered to be referral fees to IDC.
Mitigation
7. Mr Lamb, Ms Scott and Mr Quigley put forward the following mitigation to the above:
7.1 At the time that the breaches identified above occurred, the partners considered the IDC Scheme to be similar to that of the Law Society endorsed scheme run by Accident Line Protect. The partners understood IDC to be providing a valuable service which saved time, expense and was permitted.
7.2 As soon as concern about making deductions from settlements was publicly highlighted the practice of doing so ended. Where deductions have been made the money has now been repaid in full.
7.3 The proportion of fees recovered by Beecham Peacock in relation to IDC matters represented less than two-percent of their total gross fees for the period in question.
Regulatory Outcome
8. Mr Lamb, Ms Scott and Mr Quigley are reprimanded for the breaches identified at paragraph 5 above.
9. Mr Lamb, Ms Scott and Mr Quigley agree that this agreement may be published by the Solicitors Regulation Authority and that it may also be disclosed to any person upon request or otherwise.
10. Mr Lamb, Ms Scott and Mr Quigley agree that they will not act in any way inconsistent with this agreement such as, for example, by denying the misconduct found in paragraph 6 above. This restriction will not however prevent the Firm contesting on its merits an individual complaint to the Legal Complaints Service which might be made.
11. If Mr Lamb, Ms Scott or Mr Quigley act in any way inconsistently with this agreement, any such failures/inconsistent actions will be considered as a matter of professional misconduct on the basis that these constitute breach of Rule 1 of the Solicitors’ Code of Conduct 2007.
12. The partners agree to pay the costs of the investigation of the SRA, these being £1,950.00 within 14 days of the date of this agreement.
13. The date of this agreement is 7 June 2010.
Signed:
Mr David Lamb
Ms Kirsten Scott
Mr Mark Quigley
Mr David J Middleton
Legal Director
for the Solicitors Regulation Authority