Warning notice

Employed solicitors: publicity and information provided to third parties

Issued on 8 July 2014

Status

This warning notice does not form part of the Solicitors Regulation Authority (SRA) Handbook. However, the SRA will have regard to it when exercising its regulatory functions.

Who is this warning notice relevant to?

In-house/employed solicitors

Our concerns

There have been a number of complaints from the public regarding misleading information contained in letters and in letterheads, of some in-house solicitors. These complaints arise as a result of in-house solicitors giving the impression, through the wording contained in letters, through the use of business names by in-house solicitors, by the description of their regulatory status and by their contact details that they are an independent firm of solicitors or other legal services firm.

Overall, these approaches appear to be attempts to give the impression to a third party that an external agency or firm has been instructed to take legal action, up to and including, court proceedings.

These complaints have arisen most commonly in debt collection or enforcement matters where solicitors are employed in-house by the organisation seeking to recover the debt.

Further concern has been caused by complaints of solicitors having taken unfair advantage of a third party’s lack of legal knowledge, particularly in debt collecting matters, where the third party is unrepresented.

The SRA Principles

The SRA Principles are mandatory and apply to all solicitors and to those acting under their supervision. The following SRA Principles are of particular relevance to this issue.

  • Principle 2 – You must act with integrity
  • Principle 6 – You must behave in a way that maintains the trust the public places in you and in the provision of legal services

SRA Mandatory Outcomes

The Outcomes in the SRA Code of Conduct 2011 are mandatory and describe what firms and individuals are expected to achieve in order to comply with the relevant SRA Principles. However, they are not an exhaustive list of the application of all the Principles.

The following Outcomes are of particular relevance to this issue.

  • O(8.1) – your publicity in relation to your firm or in house practice or for any other business is accurate and not misleading, and is not likely to diminish the trust the public places in you and in the provision of legal services.
  • O(8.4) – clients and the public have appropriate information about you, your firm and how you are regulated.
  • O(11.1) – you do not take unfair advantage of third parties in either your professional or personal capacity.

Regulatory action

Failure to comply with this warning notice will lead to regulatory action. Regulatory action may also be necessary because of misconduct that has already taken place.

Our expectations

All solicitors must act with integrity and maintain the trust the public places in them and in the provision of legal services. We expect that all publicity and information regarding your position, as an in house/employed solicitor, is compliant with the Principles and relevant Outcomes in the SRA Code of Conduct 2011.

We have reviewed a number of complaints and a range of letters sent by solicitors employed within financial (and similar) institutions to pursue debts or other outstanding sums of money. We consider that, through a range of approaches, attempts are being made to mislead third parties (invariably individual debtors) that their case has been referred by the organisation owed money to an independent law firm to pursue the debt, notably the "naming" of in-house legal teams in the style of independent law firms.

We consider that such approaches do not meet the requirements of Principles 2 and 6 and of Outcomes 8.1, 8.4 and 11.1.

Letterheads must be clear as to the organisation employing you and you must not give any impression that you are part of an independent law firm or firm of solicitors or an independent solicitor.

Any contact details should ensure the third party is aware who they are contacting whether you directly, the in-house legal department or other staff of your employer.

Any correspondence from you, or sent under your supervision, must indicate your individual status as a solicitor regulated by the SRA but must not seek to give any impression that the organisation which employs you is regulated by the SRA.

Overall, the obligation on you is to take positive steps to ensure that third parties are clear about your status and relationship with the organisation seeking recovery of the debt.

In considering any complaints or regulatory action the SRA will consider whether the Principles are being complied with and Outcomes being met. We will consider the overall impact on the third party of information provided in the letterhead, the body of the correspondence and in the references made to regulatory status. In particular we will consider whether the totality of the information provided makes the solicitor’s status clear or whether it gives a false impression and may mislead.

Further help

If solicitors require further help, they can call or email the SRA Ethics helpline.