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Legal Services Act 2007 (Functions of an Approved Regulator) Order 2009

Volume 715: debated on Wednesday 2 December 2009

Considered in Grand Committee

Moved By

That the Grand Committee do report to the House that it has considered the Legal Services Act 2007 (Functions of an Approved Regulator) Order 2009.

Relevant Document: 23rd Report, Session 2008-09, from the Joint Committee on Statutory Instruments.

My Lords, I shall also speak to the second order in my name on the Order Paper.

Noble Lords who have followed the reform of legal services regulation will be aware that it has long been the Government’s intention to see the new Legal Services Act 2007 regulatory regime go live at the beginning of 2010. The sixth Legal Services Act commencement order, which we intend to bring into force in January 2010, will see the Legal Services Board assume its full regulatory powers and approved regulators authorising individuals and bodies to carry on reserved legal activities. Provisions relating to the Office for Legal Complaints and alternative business structures will be commenced at a later stage.

The 2007 Act contains provisions needed for the new regulatory regime to be effective, such as the repeal of current mechanisms for authorising legal professionals, transitional arrangements for those currently authorised, and consequential amendments to primary legislation which ensure that references in primary legislation to the authorisation of legal professionals take account of the new regime.

The 2007 Act also provides powers to make subsequent amendments to primary and secondary legislation to accommodate the changes being brought about by the Act. These two orders use those powers to make amendments to existing legislation to ensure that it will be compatible with the changes being commenced in the sixth commencement order.

I turn first to the Legal Services Act 2007 (Consequential Amendments) Order 2009. This order is made principally under Sections 208(2) and (3) of the Legal Services Act 2007, to which I shall refer as the 2007 Act. Section 208(2) allows the Lord Chancellor to make any supplementary, incidental, consequential or transitional provision necessary to give full effect to the Act. Section 208(3) allows the Lord Chancellor to amend, repeal or revoke existing legislation, again as necessary to give effect to the Act.

As I mentioned in my introduction, one of the key elements of the new regulatory regime is the requirement for persons to be authorised by approved regulators if they are to carry on reserved legal activities. This will replace a number of existing provisions that allow persons to carry on legal activities by virtue of their professional titles or by definitions such as “authorised advocates” and “legal representatives”. Schedule 21 to the 2007 Act amends references in primary legislation so that they refer to the new authorisation regime, once commenced in early 2010.

However, Schedule 21 does not include changes needed to secondary legislation, such as references to “authorised advocates” and “appropriate officers” in the Coroners Rules 1984 and the definitions of “legal representatives” and “professional legal advisers” in the Family Proceedings Rules 1991. This order amends such references in secondary legislation to ensure that they refer to the authorisation regime established under the 2007 Act.

The order similarly amends references to “legal representatives” in the Court of Protection Rules 2007 and the Mental Health Review Tribunal for Wales Rules 2008. As these rules were made after the Session in which the 2007 Act was passed, the amendments could not be made using the Section 208 powers and had to be made instead using the powers in the original enabling Acts for those rules—Section 78 of the Mental Health Act 1983 and Section 51 of the Tribunals, Courts and Enforcement Act 2007. The necessary statutory consultation process, with the Administrative Justice and Tribunals Council, the Lord Chief Justice and the Judicial Appointments Commission, was followed for the amendments to these rules.

The order also updates the definition of “qualified lawyers”, specifically in relation to compromise agreements. This ensures that fellows of the Institute of Legal Executives may continue to advise on compromise agreements if they become managers of legal disciplinary practices, a possibility introduced by changes made to the regulation of solicitors’ practices by the 2007 Act in March 2009.

The order also makes minor consequential and technical amendments to primary and secondary intellectual property legislation when the responsibility for the registers of patent attorneys and trade-mark attorneys passes from the Intellectual Property Office to the Chartered Institute of Patent Attorneys and the Institute of Trade Mark Attorneys respectively. For example, references to “agent” will be replaced by “attorney” and references to “individual” will be replaced by “person”, recognising that entities as well as individuals can apply for registration.

Finally, the order amends a number of outdated references to “taxation”, “taxing officers” and “taxed” in the Charities Act 1993. The Legal Services Act replaces most outdated references to “taxation” in primary legislation, primarily the Solicitors Act 1974, with the more modern terms relating to “assessment”. However, no provision was made for the references in the Charities Act, and it has therefore not been possible to commence related amendments to other legislation. This order amends the Charities Act, and other related amendments will now be commenced.

As the order amends a range of existing legislation, it was important to consult other government departments and key stakeholders, such as the Law Society and other professional bodies, at an early stage and gain their approval. The Lord Chief Justice of England and Wales, the Judicial Appointments Commission and the Administrative Justice and Tribunals Council also gave their approval to the amendments.

I turn now to the Legal Services Act 2007 (Functions of an Approved Regulator) Order 2009. Again, this order is necessary as a consequence of changes that will be introduced with the sixth Legal Services Act commencement order. The order amends an inadvertent drafting error in the 2007 Act which, if left uncorrected, would result in the Institute of Trade Mark Attorneys being unable to regulate trade-mark attorney work undertaken outside the UK when it becomes an approved regulator at go-live. Correcting the error will also ensure that the scope of regulation applying to trade-mark attorneys mirrors the scope of regulation applying to patent attorneys.

New Section 83A of the Trade Marks Act 1994, as inserted by Section 184 of the 2007 Act, replicates a drafting discrepancy between the two statutory instruments which govern the registration of patent attorneys and of trade-mark attorneys. Unlike the instrument relating to patent attorneys, the definition in the trade-mark order of trade-mark attorney work does not include “or elsewhere”. The result is that the Institute of Trade Mark Attorneys would not be able to regulate trade-mark attorney work undertaken outside the UK, while its counterpart, the Chartered Institute of Patent Attorneys, is able to regulate patent work outside the UK. It is not the policy intention of the 2007 Act to make such a distinction, so the order corrects the oversight and ensures parity between the regulation of patent and trade-mark work.

The amendment is being made under Section 69 of the Legal Services Act, which provides for the Lord Chancellor, by order, to modify or make other provision relating to the functions of an approved regulator or any other body. As required by Section 69, the order is being made on the recommendation of the Legal Services Board. The board is obliged to consult whenever it recommends a statutory instrument to the Lord Chancellor under these provisions. Accordingly, a consultation paper, together with a draft order and draft impact assessment, was circulated to consumer organisations, regulatory bodies, other professional representative bodies and other key stakeholders during the summer. Six responses were received, which either provided no comment on or approved the proposed amendment.

These orders are required to reflect the changes introduced by the 2007 Act and to ensure consistency of terminology across different pieces of legislation. It is important that the orders are made to coincide with the sixth Legal Services Act commencement order, so that references to the new regulatory regime are consistent when it is commenced in early 2010. It is also important to note that the orders do not expand the scope of existing policy or extend the categories of person who can carry out reserved legal services. I commend these orders to the Committee.

My Lords, I thank the noble Lord, Lord Tunnicliffe, for that lengthy explanation of the two orders, and assure him that I will be considerably briefer; I want to make only two or three points. He dealt with the instruments in inverse order, so I will follow him and start with the Legal Services Act 2007 (Consequential Amendments) Order 2009. I was not involved with that Act—I think Lord Kingsland dealt with it—but I remember its passage. As the Minister made clear, the purpose of the instrument is to amend both primary and secondary legislation. It is obviously appropriate that secondary legislation be amended by secondary legislation but, in the main, we regret Henry VIII powers—they are obviously used here—that allow the amending of primary legislation. I say “in the main”; having looked at what the consequential amendments order tries to do, I think that it is probably right that the powers were there and were used. On this occasion, we are content with the order and what it is seeking to do. We think it is right to ensure, as the noble Lord put it, that members of bodies such as ILEX who are managers of legal disciplinary practices are able to continue to advise on compromise agreements as set out in the order. I have no further comment to make about that.

The second order regarding the functions of an approved regulator appears at first sight to be innocuous. The Minister made clear that it amends an inadvertent drafting error in the Legal Services Act 2007. He ought to think long and hard about those words, “inadvertent drafting error”, and remember the remarks of the noble and learned Lord, Lord Woolf, on the second day of the Queen’s Speech debate when he referred to the torrent of legislation emanating from departments, particularly the Ministry of Justice and the Home Office. If there had not been quite such a torrent of legislation and the Government had confined themselves to properly drafted Bills dealing with single subjects—for which I commend the Bribery Bill, which we are dealing with next week, and which was also commended by the noble and learned Lord—we might not have had those inadvertent errors that have involved the Government having to come back with obscure orders of this sort later on. Those are my only comments on this and I hope that the Minister will take them on board, particularly with regard to future orders that he might want to put before us.

My Lords, I was involved in the passage of the Legal Services Act 2007. I have spoken long and boringly on that to reopen all those issues again.

With regard to the Legal Services Act 2007 (Consequential Amendments) Order, I am rather sorry to see the loss of the word “taxation” from the Charities Act. It was certainly well understood. My costs are still taxed by a taxing officer, as far as I am aware; that is why I do not get as much as I ask for. The concept is still being maintained, with assessments and costs officers, so why we have to modernise the terminology, I am not sure. I have no objection to either of these orders going through.

My Lords, I thank noble Lords for their comments. I think all Members of the House have a natural concern about Henry VIII powers, and I thank the noble Lord, Lord Henley, for his scrutiny and his acceptance that they are appropriate in this case.

I apologise on behalf of the Government for the drafting errors. I do my best to ensure that we make no errors, but I am afraid that we do. However, I am not going to apologise for the “torrent of legislation”, as it has been put. In the past Session I have been involved in a good amount of legislation, and one of its intentions has been to make things more appropriate, simpler and more straightforward. The 2007 Act is such a piece of legislation, as are the Acts that we will be coming on to.

I am sorry that the noble Lord, Lord Thomas, has lost the word “taxation” in the consequential amendments order, but the world moves on. I think we are right to present the order that causes its loss.

Motion agreed.