Indemnity

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You are reading current version in effect from 1 October 2020

Glossary terms

member (2012)
(i)

means:

(A)

in relation to a company, a person who has agreed to be a member of the company and whose name is entered in the company's register of members; and

(B)

in relation to an LLP, a member of that LLP; save that

(ii)

for the purposes of the SRA Indemnity Rules, means a member of a practice, being:

(A)

any principal (including any principal) therein;

(B)

any director or officer thereof, in the case of a recognised body or a licensed body which is a company;

(C)

any member thereof in the case of a recognised body or a licensed body which is an LLP;

(D)

any recognised body or a licensed body which is a partner or held out to be a partner therein and any officer of such recognised body or a licensed body which is a company, or any member of such recognised body or a licensed body which is an LLP;

(E)

any person employed in connection therewith (including any trainee solicitor);

(F)

any solicitor or REL who is a consultant to or associate in the practice;

(G)

any foreign lawyer who is not an REL and who is a consultant or associate in the practice; and

(H)

any solicitor or foreign lawyer who is working in the practice as an agent or locum tenens, whether he or she is so working under a contract of service or contract for services;

and includes the estate and/or personal representative(s) of any such persons.

previous practice (2012)

means any practice which shall have ceased to exist as such for whatever reason, including by reason of:

(i)

any death, retirement or addition of principals; or

(ii)

any split or cession of the whole or part of its practice to another without any change of principals.

master policy (2012)

means a policy referred to in Rule 5 of the SRA Indemnity Rules.

person (2012)

includes a body of persons (corporate or unincorporated).

indemnity period (2012)

means:

(i)

in the SRA Indemnity Insurance Rules, the period of one year starting on 1 September 2000, 2001 or 2002, the period of 13 calendar months starting on 1 September 2003, or the period of one year starting on 1 October in any subsequent calendar year; and

(ii)

in the SRA Indemnity Rules, the period of one year commencing on 1 September in any calendar year from 1987 to 2002 inclusive, the period of 13 calendar months commencing on 1 September 2003, and the period of one year commencing on 1 October in any subsequent calendar year.

qualifying insurance (2012)

means a policy that provides professional indemnity insurance cover in accordance with the MTC but only to the extent required by the MTC.

SIIR (2012)

means the Solicitors' Indemnity Insurance Rules 2000 to 2010, the SRA Indemnity Insurance Rules 2011 to 2012 or the SRA Indemnity Insurance Rules or any rules subsequent thereto.

fund (2012)

means the fund maintained in accordance with the SRA Indemnity Rules.

private practice (2012)
(i)

for the purposes of the SRA Indemnity Insurance Rules:

(A)

in relation to a firm which is a licensed body means its regulated activities; and

(B)

subject to paragraph (A) of this definition, in relation to all firms includes without limitation all the professional services provided by the firm including acting as a personal representative, trustee, attorney, notary, insolvency practitioner or in any other role in conjunction with a practice, and includes services provided pro bono publico,

but does not include:

(C)

solicitor or REL in the course of employment with an employer other than a firm; or

(D)

non-SRA firm or by an REL through an Exempt European Practice; or

(E)

discharging the functions of any of the following offices or appointments:

(I)

judicial office;

(II)

Under Sheriffs;

(III)

members and clerks of such tribunals, committees, panels and boards as the Council may from time to time designate but including those subject to the Tribunals and Inquiries Act 1992, the Competition Commission, Legal Services Commission Review Panels, Legal Aid Agency Review Panels and Parole Boards;

(IV)

Justices' Clerks;

(V)

Superintendent Registrars and Deputy Superintendent Registrars of Births, Marriages and Deaths and Registrars of Local Crematoria; or

(VI)

such other offices as the Council may from time to time designate;

(F)

solicitor or REL's family, or registered charities; or

(G)

in respect of a sole solicitor or a sole REL, practice consisting only of:

(I)

providing professional services without remuneration for friends, relatives, or to companies wholly owned by the solicitor or REL's family, or registered charities; and/or

(II)

administering oaths and statutory declarations; and/or

(III)

activities which could constitute practice but are done in the course of discharging the functions of any of the offices or appointments listed in paragraphs (E)(I) to (VI) above.

(ii)

for the purposes of the SRA Indemnity Rules "private practice" shall be deemed to include:

(A)

the acceptance and performance of obligations as trustees; and

(B)

notarial practice where a solicitor notary operates such notarial practice in conjunction with a solicitor's practice, whether or not the notarial fees accrue to the benefit of the solicitor's practice;

but does not include:

(C)

practice to the extent that any fees or other income accruing do not accrue to the benefit of the practice carrying on such practice (except as provided by paragraph (B) in this definition);

(D)

practice by a solicitor or REL in the course of his or her employment with an employer other than a solicitor, REL, recognised body, licensed body or partnership such as is referred to in Rule 6.1(d) to 6.1(f); in which connection and for the avoidance of doubt:

(I)

any such solicitor or REL does not carry on private practice when he or she acts in the course of his or her employment for persons other than his or her employer;

(II)

any such solicitor or REL does not carry on private practice merely because he or she uses in the course of his or her employment a style of stationery or description which appears to hold him or her out as a principal or solicitor or foreign lawyer in private practice; or

(III)

any practice carried on by such a solicitor outside the course of his or her employment will constitute private practice;

(E)

discharging the functions of the following offices:

(I)

judicial office;

(II)

Under Sheriffs;

(III)

members and clerks of such tribunals, committees, panels and boards as the Council may from time to time designate but including those subject to the Tribunals and Inquiries Act 1992, the Competition Commission, Legal Services Commission Review Panels and Parole Boards;

(IV)

Justices' Clerks;

(V)

Superintendent Registrars and Deputy Superintendent Registrars of Births, Marriages and Deaths and Registrars of Local Crematoria;

(VI)

such other offices as the Council may from time to time designate.

principal (2012)
(i)

subject to paragraphs (ii) to (iv) means:

(A)

a sole practitioner;

(B)

a partner in a partnership;

(C)

in the case of a recognised body which is an LLP or company, the recognised body itself;

(D)

in the case of a licensed body which is an LLP or company, the licensed body itself;

(E)

the principal solicitor or REL (or any one of them) employed by a non-solicitor employer (for example, in a law centre or in commerce and industry); or

(F)

in relation to any other body, a member of its governing body;

(ii)

in the SRA Authorisation Rules, SRA Practice Framework Rules and SRA Practising Regulations, means a sole practitioner or a partner in a partnership;

(iii)

in the SRA Indemnity Insurance Rules means:

(A)

where the firm is or was:

(I)

a sole practitioner - that practitioner;

(II)

a partnership - each partner;

(III)

a company with a share capital - each director of that company and any person who:

(01)

is held out as a director; or

(02)

beneficially owns the whole or any part of a share in the company; or

(03)

is the ultimate beneficial owner of the whole or any part of a share in the company;

(IV)

a company without a share capital - each director of that company and any person who:

(01)

is held out as a director; or

(02)

is a member of the company; or

(03)

is the ultimate owner of the whole or any part of a body corporate or other legal person which is a member of the company;

(V)

an LLP - each member of that LLP, and any person who is the ultimate owner of the whole or any part of a body corporate or other legal person which is a member of the LLP;

(B)

where a body corporate or other legal person is a partner in the firm, any person who is within paragraph (A)(III) of this definition (including sub-paragraphs (01) and (03) thereof), paragraph (A)(IV) of this definition (including sub-paragraphs (01) and (03) thereof), or paragraph (A)(V) of this definition;

(iv)

in the SRA Indemnity Rules, means:

(A)

a solicitor who is a partner or a sole solicitor within the meaning of section 87 of the SA, or an REL who is a partner, or who is a sole practitioner, or an RFL or non-registered European lawyer who is a partner, and includes any solicitor, REL, RFL or non-registered European lawyer held out as a principal; and

(B)

additionally in relation to a practice carried on by a recognised body or a licensed body alone, or a practice in which a recognised body or a licensed body is or is held out to be a partner:

(I)

a solicitor, REL, RFL or non-registered European lawyer (and in the case of a licensed body any other person) who:

(01)

beneficially owns the whole or any part of a share in such recognised body or licensed body (in each case, where it is a company with a share capital); or

(02)

is a member of such recognised body or licensed body (in each case, where it is a company without a share capital or an LLP or a partnership with legal personality); or

(II)

a solicitor, REL, RFL or non-registered European lawyer (and in the case of a licensed body any other person) who is:

(01)

the ultimate beneficial owner of the whole or any part of a share in such recognised body or licensed body (in each case, where the recognised body or licensed body is a company with a share capital); or

(02)

the ultimate owner of a member or any part of a member of such recognised body or licensed body (in each case, where the recognised body or licensed body is a company without a share capital or an LLP or a partnership with legal personality).

eligible former principal (2012)

means a principal of a previous practice where:

(i)

that previous practice ceased on or before 31 August 2000; and

(ii)

a relevant claim is made in respect of any matter which would have given rise to an entitlement of the principal to indemnity out of the fund under the Solicitors' Indemnity Rules 1999 had the claim been notified to Solicitors Indemnity Fund Limited on 31 August 2000; and

(iii)

the principal has not at any time been a "principal" of the relevant successor practice ("principal" having the meaning applicable to the SIIR); and

(iv)

at the time that the relevant claim is made the principal is not a "principal" in "private practice" ("principal" and "private practice" having the meanings applicable to the SIIR).

relevant successor practice (2012)

means in respect of a previous practice, a successor practice or a "successor practice" (as defined in Appendix 1 to the SIIR) (as may be applicable) against which a relevant claim is made.

expired run-off claim (2012)

means any claim made against the fund for indemnity under the SRA Indemnity Rules in respect of which no preceding qualifying insurance remains in force to cover such claim, by reason only of:

(i)

the run-off cover provided or required to be provided under the policy having been activated; and

(ii)

the sixth anniversary of the date on which cover under such qualifying insurance would have ended but for the activation of such run-off cover having passed; or

(iii)

(in the case of a firm in default or a run-off firm) the period of run-off cover provided or required to be provided under arrangements made to cover such claim through the ARP having expired.

preceding qualifying insurance (2012)

means, in the case of any firm or person who makes an expired run-off claim, the policy of qualifying insurance which previously provided run-off cover in respect of that firm or person, or which was required to provide such cover, or (in the case of a firm in default or a run-off firm) arrangements to provide such run-off cover through the ARP.

claim (2012)

means a demand for, or an assertion of a right to, civil compensation or civil damages or an intimation of an intention to seek such compensation or damages. For these purposes, an obligation on an insured firm and/or any insured to remedy a breach of the Solicitors' Accounts Rules 1998 (as amended from time to time), or any rules (including, without limitation, the SRA Accounts Rules) which replace the Solicitors' Accounts Rules 1998 in whole or in part, shall be treated as a claim, and the obligation to remedy such breach shall be treated as a civil liability for the purposes of clause 1 of the MTC, whether or not any person makes a demand for, or an assertion of a right to, civil compensation or civil damages or an intimation of an intention to seek such compensation or damages as a result of such breach, except where any such obligation may arise as a result of the insolvency of a bank (as defined in section 87 of the SA) or a building society which holds client money in a client account of the insured firm or the failure of such bank or building society generally to repay monies on demand.

insured (2012)

in the SRA Indemnity Insurance Rules means each person and entity named or described as a person to whom the insurance extends and includes, without limitation, those referred to in clause 1.3 in the MTC and, in relation to prior practices and successor practices respectively, those referred to in clauses 1.5 and 1.7 of the MTC.

circumstances (2012)

means an incident, occurrence, fact, matter, act or omission which may give rise to a claim in respect of civil liability.

expired run-off cover (2012)

means either:

(i)

(unless (ii) below applies) the terms of the preceding qualifying insurance, excluding clause 5 (Run-off cover) of the MTC, as if it were a contract between Solicitors Indemnity Fund Limited and the firm or person making an expired run-off claim; or

(ii)

where they are provided to Solicitors Indemnity Fund Limited prior to payment of the claim, the terms of the preceding qualifying insurance, provided that:

(A)

references in the preceding qualifying insurance to the qualifying insurer that issued such insurance shall be read as references to Solicitors Indemnity Fund Limited;

(B)

any obligation owed by any insured under the preceding qualifying insurance to the qualifying insurer which issued such insurance shall be deemed to be owed to Solicitors Indemnity Fund Limited in place of such qualifying insurer, unless and to the extent that Solicitors Indemnity Fund Limited in its absolute discretion otherwise agrees;

(C)

the obligations of the fund and/or any insured in respect of an expired run-off claim shall neither exceed nor be less than the requirements of the MTC which, in accordance with the applicable SIIR, such preceding qualifying insurance included or was required to include.

Solicitors Indemnity Fund Limited shall be under no obligation to take any steps to obtain the terms of any such preceding qualifying insurance, which for these purposes includes the terms on which it was written in respect of the insured firm or person in question, and not merely a standard policy wording.