Law firms are authorised and regulated by the SRA and the subject of a number of Acts and Instruments. Prospective managers of law firms should ensure they are familiar with the following:
The Law Society provides some helpful guidance in this respect and in particular the note on law firm regulatory requirements is highly recommended: http://www.lawsociety.org.uk/support-services/advice/practice-notes/setting-up-a-practice-regulatory-requirements/.
Perhaps the best place to start would be to review Chapter 7 of the SRA Code of Conduct (the “Code”) which deals with the management of law firms and, in short, requires well planned and considered management designed to protect the interests of clients, minimise risk and ensure standards are maintained throughout the profession. Chapter 1 on client care should also be regarded as essential reading.
The Code refers to outcomes rather than rules. This move to results based regulation is welcome and provides law firms with more scope to take a proportionate view to the risks they face, but in no way should this change be considered a “light touch”. The SRA expects to see effective systems and controls in place to comply with the relevant regulations. This should include evidence that the material risks and duties have been considered, a plan has been put in place to address them/comply with them and further that such plan is effective. It is therefore a good idea to draft the following policies and precedents:
Putting these policies together can be a time consuming business. Template policies which are adequate for most firms can be purchased online (see Compliance Office website). The SRA expect suitable polices to be in place, but that alone does not achieve the relevant outcomes. Instead every law firm must be familiar with and comply with the policies. Regular internal training is also a requirement.
However, help is at hand in the form of a number of external compliance consultants who can make the process of achieving proportionate compliance possible and retaining a compliance expert can be very cost effective. One such expert is Matthew Moore of Infolegal. Infolegal offers compliance support by way of a retainer or an ad hoc basis, it also offers packages of relevant compliance documents, guidance notes and factsheets.
There is an alternative solution if you seek all the flexibility and freedom of setting up your own law firm but wish to avoid the investment inherent in setting up.