To ask the Secretary of State for Justice, if he will make an assessment of the potential merits of bringing forward proposals to ensure that people who have lost a court case a result of a solicitor's negligence are able to access legal redress in the event that the law firm for which that solicitor worked has gone out of business.
The legal profession in England and Wales operates independently of Government. The responsibility for regulating the sector sits with the approved regulators, overseen by the Legal Services Board (LSB). There are several routes in place to ensure consumers have access to legal redress in the event of the collapse of their solicitor’s law firm.
The Legal Ombudsman (LeO) deals with service complaints against regulated legal services providers – including those who are no longer operational. Their website provides information with regards to the different routes available for consumers depending on their personal circumstances.
If an Ombudsman has made a final decision against a closed legal service provider and the consumer has not received any redress, they can decide to enforce the Ombudsman’s decision in court or make a complaint against the firm’s indemnity insurance. The Ombudsman can help consumers with finding contact details for relevant indemnity insurers.
The Solicitors Regulation Authority (SRA) also considers redress where consumers have lost money as a result of fundamental ethical failures by solicitors that they regulate. Consumers affected by said issues may be able to claim against the provider’s indemnity insurer or the ‘Solicitors Indemnity Fund’ via the SRA’s website, in certain circumstances. The SRA offers support to members of the public in making claims and the relevant form can be found on their website at: www.sra.org.uk/sra-managing-sif . They also may be able to apply to the SRA’s compensation fund if they believe a solicitor owes them money or believe their loss relates to services provided by a solicitor. The form and guidance on this can be found on the SRA’s website at https://www.sra.org.uk/consumers/compensation-fund/application-process/.