The Gazette 1991

g a z e t t e

april

1991

come from sole practitioners ac- counting for a total of £3.9 million in that period. Late submission to the Society of accountants' cer- tificates is undoubtedly one of the early warning signs and the Socie- ty has now embarked on a policy which will see Practising Cer- tificates withheld where solicitors offend against this requirement. It is also the policy of the Society to issue i n j unc t i on proceedings against solicitors who continue to practise without a Practising Cer- tificate. Recently, staff at Blackhall Place has been augmented to enable effect to be given to this policy. Other measures are also be- ing considered and the matter will, it is hoped, be one of the issues that the forthcoming Solicitors Bill will address. It is in nobody's interest that the protection which the ordinary member of the public enjoys at pre- sent should be lessened in any way; that is not the Society's objective. That could happen, however, if the Fund were not in a position to meet the demands placed upon it. It might also, ,of course, happen if the courts were to hold that the Fund, in its present form, is not in accordance wi th constitutional norms of justice and the Govern- ment would do well to bear that in mind. A challange has already been threatened. The Society intends to continue to press its case for reasonable change while, at the same time, monitoring the profession with the utmost diligence to try to lessen the burden on the honest practi- tioner. Inland [1989] I.R. 234 This case concerned specifically s.21 (4) of the Solicitors (Amendment) Act, 1960, relating to the Compen- sation Fund, which subsection provides as follows:- "Whe re it is proved to the satisfaction of the Society that any person has sustained loss in conse- quence of dishonesty on the part of any solicitor or any clerk or servant of a solicitor in connection with that solicitor's practice as a solicitor or in connection with any trust of which Noel C. Ryan, Director General * Trustee Incorporated Savings Bank -v- Law Sociaty of

the solicitor is a trustee, then, subject to the provisions of this section, the Society shall make a grant to that person out of the Fund and the amount of the grant shall be such as represents in the opinion of the Societyfull indemnity for that loss". By comparison s.23, (2) of the 1960 Act, which provides for the making by solicitors who practice in both parts of Ireland of a combined annual contribution to the Com- pensation Funds of the Incorporated Law Society of Ireland and the Incor- porated Law Society of Northern Ireland, refers to a scheme operated by the Northern Ireland Society requiring contributions to a fund "for the compensation or indemnification of clients for or against losses due to defalcations of such practitioners or their clerks or servants . . . " M., a partner in a firm of solicitors, applied to the plaintiff for a loan which was expressed to be for the purpose of purchasing a house. The plaintiff agreed to make the loan on condition that it received certain undertakings from the applicant's firm. A letter, which contained the required undertakings and which purported to be signed by another partner on behalf of the firm, was forged by M., and presented to the plaintiff, and monies were advanced by the plaintiff to the firm's account. When called upon to do so, both M. and his firm failed to repay the loan. The plaintiff applied to the defendant for compensation in respect of its loss from the fund maintained by the defendant. The defendant refused to pay compensation on the grounds that the plaintiff had not been a client of the solicitor. The plaintiff success- fully applied to the High Court for a declaration that it was entitled to be paid compensation by the defendant out of the fund, and for an order that such payment be made. (See [1987] I.R. 430 for High Court decision of Johnson J. delivered 30/7/87). On the defendant's appeal against the judgment and order of the High Court, it was Held by the Supreme Court (Finaly CJ, Griffin and McCarthy JJ concurring) in dis- missing the appeal, 1. that the fact that s.21, sub-s.4 made specific provision for cases where a person sustained loss in consequence of dishonesty on the part of a solicitor "in connection with any trust of which that solicitor is a trustee" did not mean that the phrase "any person" in the sub-section

should otherwise be interpreted as including only those who had been clients of solicitors; the special provision had been added in recognition of the fact that solicitors were often chosen to act as trustees but, in carrying out such duties, were not necessarily acting in connection with their practices as solicitors. 2. That the description given in s.23, sub-s.4 to the scheme operated by the Northern Ireland Law Society, which was expressed to be for the compensation of " c l i e n t s" of solicitors, had no relevance to the interpretation to be given to s.21, sub- s.4 of the Act. 3. That, interpreting s.21, sub-s.4 according to its plain and unam- biguous meaning, the plaintiff was rightly held to be a person which had sustained loss in consequence of dishonesty on the part of a solicitor, within the meaning of the sub- section. 4. That in providing the plaintiff with a forged letter purporting to contain undertakings and to be issued on behalf of the firm of which he was a partner, M. was guilty of dishonesty in connection with his practice as a solicitor. • m/ James Nash F.S.S. DÍ P .

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