Sue Tipper and Linden Talbot look at the reasons for, and effect of, an intervention by the Solicitors Regulation Authority and address the three main concerns clients may have. Intervention is where the SRA closes down a firm and takes possession of all papers, client files and money held by the firm. It can happen for a variety of reasons, mainly involving breaches of the Code of Conduct, which sets out the requirements which all solicitors are required to follow, and breaches of account rules, both of which are in place to protect clients. Whilst the purpose of an intervention is to protect clients’ interests and their money, it can be a worrying time as clients may not find out about it until they attempt to contact their solicitor or receive a letter from the SRA advising of the intervention. What are clients’ main concerns and what can they do about it?
What will happen to my file and any original documents, eg wills, Title Deeds etc? The SRA’s appointed agent (the “Intervention Solicitors”) will remove your file from the intervened firm and look after it. They will then contact you directly to let you know where it is and how to access it. If there are any urgent matters, for example imminent completions, court deadlines etc, the Intervention Solicitors will contact you straight away. If not, you will be contacted in the days/weeks ahead and notified of their action. We can retrieve your file from the Intervention Solicitors on your behalf and review it to see whether any further work needs to be done. We can also retrieve your original documents and if you so require we can store these for you. What if there is outstanding work to be completed? You will likely need another firm to complete your instructions and you should appoint another firm as soon as possible. You may find that deadlines that were not urgent when the intervention took place soon become urgent and require your attention. This may include deadlines for paying stamp duty, complying with court directions and adhering to limitation deadlines. What has happened to the money the firm was holding for me? The firm’s accounts are taken over by the SRA and go into a central “Statutory Trust Fund”. The Intervention Solicitors then go through the process of trying to reconcile the accounting records of the firm with each individual client’s matter ledger. Depending on the size of the firm and the state of the accounts/records this process can take many months to complete. You will need to complete a claim form and file it with the Intervention Solicitors for your claim to be investigated. At the end of the investigation the Intervention Solicitors report to the SRA and any distributions from the accounts are then authorised for payment. If there are insufficient monies to pay all clients a pro-rated amount will be paid out equally. If you do not recover all that you are owed, or you do not want to wait until the conclusion of the SRA’s investigations into the accounts, you can file a claim through the SRA’s Compensation Fund. This is a fund which is maintained to cover instances where clients have lost money or are likely to have lost money as a result of a defaulting firm. You can also claim compensation to finish incomplete work that you have already paid for. The Compensation Fund claims are usually decided upon far sooner than the Intervention Solicitors can complete its detailed investigations into the accounts. How we can help We have experience in retrieving files from intervened firms and taking over conduct of files to ensure minimal disruption to clients. We are able to grasp the issues quickly and ensure as smooth a transition as possible takes place from your old firm to us. Our approach is to advise you on the likely overall costs at the outset and allow you to make an informed choice of you options. We have experience assisting clients to submit claims to the Intervention Solicitors as well as claims to the Compensation Fund and can provide advice specific to you and your needs. If you would like to discuss any of the above please do not hesitate to contact Sue Tipper or Linden Talbot: Sue Tipper, Private Client Department: firstname.lastname@example.org; 01293 596908 Linden Talbot, Litigation Department: email@example.com; 01293 596984