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Improper Fee Arrangements

 Letter sent to All Members of the Bar on 18 November 2008  

The Professional Practice Committee is receiving a disturbing number of reports of arrangements being made between sets of chambers, barristers who undertake mainly publicly funded work and solicitors. These arrangements seem either to display potential maladministration of those sets or commission payments (direct or disguised) to secure work.

There are two main strands to these reports: one, actual repayments to solicitors of percentages of barristers’ fees in order to secure work and, two, the provision of very junior barristers to some solicitors’ firms at low rates in order to secure work for more senior members.

The PPC’s view is that any payment, whether apparent or disguised, to secure work is prohibited by the Code of Conduct and is a serious matter.  It will, if established, be likely to result in disciplinary action against any barrister who is a party to such an arrangement.  If the payment is being made with the knowledge or connivance of the staff in any set or is known to be occurring in it, then this would be prima facie evidence that the set was not being properly administered by the Head of Chambers, any barrister charged with administering the set and, in some circumstances, all members of the set.  This is a separate and serious breach of the Code of Conduct.

The provision of junior barristers for a fee clearly below the market rate, or that prescribed by regulation or subject to a protocol such as the Magistrates’ Courts Protocol, is capable of being a disguised commission payment.  It is also a serious abuse of the most vulnerable in the profession.  As such, it renders the Head of Chambers (and any barrister charged with administering the set and, in some circumstances, all members) in a set employing such practices liable to disciplinary action for maladministration of the set.  The Committee wants to make it clear that, under the Code of Conduct, it is no defence for a Head of Chambers to say the set is run by a committee rather than the Head of Chambers personally, even though others may also be charged. It goes without saying that this sort of abuse is an extremely serious matter: the more junior the tenant or vulnerable the barrister (eg pupils) the graver the potential offence.

These problems are not new.  Whenever there is a squeeze on payments to the profession, efforts to get round the Code become apparent amongst a minority of individuals and sets.  The Committee strongly supports the prohibition against these types of behaviour set out in the Code.  Although they are usually dressed up as efforts to be “commercial” these practices generally have three things in common: the younger and more vulnerable members lose out, presumably on a promise of “jam tomorrow”; barristers who observe the Code lose work to those who do not and an unhealthy relationship exists between certain barristers and certain solicitors which devalues the independence of the profession.

In the past a small minority of barristers have believed themselves immune from action, imagining that it would be impossible for the BSB (or formerly the Professional Conduct Committee) to obtain evidence and it would be difficult for young barristers to complain.  That in itself shows how corrupting these arrangements are. However, the PPC is happy to advise barristers concerned about these issues on a confidential basis.  It is often possible for the BSB to obtain evidence without having to disclose identities and the BSB itself can be the complainant.  It also has a power to inspect a set of chambers that is giving cause for concern.  This is a very powerful tool in these sorts of cases.

The Chairman of the Bar, the Leaders of the Circuits, the Young Barristers’ Committee and this Committee are forming an increasingly clear idea of precisely where these problems are emerging and it is our unreserved view that they need tackling quickly and urgently.  We shall pass on to the BSB’s Complaints Committee our specific concerns and we shall support the most vigorous action to stamp out this conduct.

This Committee would, therefore, advise Heads of Chambers to make absolutely sure no such arrangements exist in their sets, particularly if they do not take an active part in day-to-day administration.  To those who know of these kinds of arrangements, particularly if they are occurring in your own set, the Committee would urge you to contact the PPC, your Circuit Leader or the YBC to discuss the matter confidentially.  This is already happening so you will not be alone.  To those small minority of barristers and sets who are operating, planning or taking part in any such schemes, or who are tempted so to do, the Committee would urge you to consider the position very carefully.  This letter will be evidence that you cannot have been ignorant either of the true position under the Code of Conduct or the likely consequences of involvement in such practices.
 
David Etherington QC
Chairman, Professional Practice Committee 

Key Code References:

Fundamental Principles

307. A barrister must not:
(a) permit his absolute independence integrity and freedom from external pressures to be compromised;
(b) do anything (for example accept a present) in such circumstances as may lead to any inference that his independence may be compromised;
(c) compromise his professional standards in order to please his client the Court or a third party, including any mediator;
(d) give a commission or present or lend any money for any professional purpose to or (save as a remuneration in accordance with the provisions of this Code) accept any money by way of loan or otherwise from any client or any person entitled to instruct him as an intermediary;
(e) make any payment (other than a payment for advertising or publicity permitted by this Code or in the case of a self-employed barrister remuneration paid to any clerk or other employee or staff of his chambers) to any person for the purpose of procuring professional instructions…

Heads of Chambers

404.1 The obligations in this paragraph apply to the following members of chambers:
(a) any barrister who is head of chambers;
(b) any barrister who is responsible in whole or in part for the administration of chambers;
(c) if there is no one within (a) and (b) above, all the members of the chambers.
404.2 Any person referred to in paragraph 404.1 must take all reasonable steps to ensure that:
(a) his chambers are administered competently and efficiently and are properly staffed;
(b) the affairs of his chambers are conducted in a manner which is fair and equitable for all barristers and pupils…


Letter sent to All Members of the Bar on 9 December 2008  

I wrote to you recently about unacceptable practices in accepting work which had been drawn to the attention of the Professional Practice Committee.

This has provoked some interesting responses, some questions, and, sadly, further accounts of certain abuses.

I appreciate that some arrangements for accepting work fall into areas which may need the guidance of the Bar Council and the Bar Standards Board.

My letter was aimed, however, at obvious and clear concerns about practices towards pupils and very junior barristers, which any reasonable person would regard as unacceptable.

In the fourth paragraph of the letter, I wrote this: The provision of junior barristers for a fee clearly below the market rate, or that prescribed by regulation or subject to a protocol such as the Magistrates’ Courts Protocol, is capable of being a disguised commission payment in certain circumstances.  By that, I was referring to the provision of junior barristers by a set of Chambers in the context of the matters referred to in the second paragraph, namely: actual repayments to solicitors of percentages of barristers’ fees in order to secure work and the provision of very junior barristers to some solicitors’ firms at low rates in order to secure work for more senior members.

Barristers are, of course, always free to accept work at whatever fee is acceptable to them and those instructing them provided no commission payment to those instructing counsel is being paid. What is not acceptable is where barristers, particularly pupils and very junior barristers, are forced by their sets to accept instructions at low rates (or, in some instances, no payment at all) in some kind of arrangement where a solicitor offers in return to send a quantity of his work to more senior members in the set.

Where a barrister as an individual, or a Head of Chambers on behalf of his set has honestly and conscientiously examined arrangements made for accepting work and has satisfied himself or herself that these arrangements do not involve any form of commission payment to those providing instructions or unfairness to any member of the set (including pupils) and are compliant with current guidance and relevant protocols (such as the Magistrates’ Court Protocol) then this is powerful evidence that the barrister (or the set) is administering his practice (or the set is being administered) properly.

Some junior members and pupils have expressed doubts as to how they may raise concerns without damaging their prospects.  I appreciate that there is no easy answer to this and that it is easier for senior members of the profession to give bland assurances than for junior members to act upon them.  What I can say is that the Bar Council is alive to the very real difficulties posed for a minority of very junior barristers (including pupils) and is determined to overcome these.

As I said in my original letter, there are mechanisms which can help alleviate these problems. First, matters can be raised through a surrogate such as another member of the Bar, members of the Young Barristers’ Committee or the Leader of the Circuit.  Further, any barrister may raise an issue with the Professional Practice Committee and his or her identity will not be revealed without specific consent.  As I also indicated previously, once a particular problem is identified enquiries can be made to obtain evidence which will not necessarily require that any barrister is a named complainant.  No barrister could be a named complainant without his or her consent.  I gave some illustrations of this in my previous letter.

I am also aware that, although I am bound to send these letters to each and every barrister in independent practice, the unacceptable practices are only happening amongst a small minority of sets and practitioners.  Indeed, the queries received by the Secretariat and myself show just how conscientious and careful most barristers and sets are in administering their practices and their sets.  Unsurprisingly, no queries have been received from those administering sets about the sorts of unacceptable conduct which I have identified in these letters. In my view, it is vital to the profession that these issues are addressed rigorously.  Not only do we owe a duty to the most vulnerable, but also the practices I have identified are unfair to the overwhelming majority of practitioners and sets who conduct themselves according to the letter and spirit of our Code.


David Etherington QC
Chairman, Professional Practice Committee