Rescue rules offer 'breathing space'

A NEW statutory code of conduct for solicitors is being considered by the Republic of Ireland's Incorporated Law Society after a “disturbing” level of complaints by the public.

The society, which regulates the conduct of Ireland's 4,000 solicitors, says it is “acutely aware of the need for resolute action to reduce the volume of complaints”.

In the past year there have been 1,200 complaints arising from 6,000 letters to the society. The figures are revealed in the first annual report by two lay observers appointed to the registrar's committee, one from Irish trade unions, the other from Irish business.

The report, which has been sent to the former Irish justice minister, Maire Geoghegan-Quinn, calls for improvements in the society's complaints machinery and recommends the introduction of procedures to tackle the difficulties in solicitor/client relationships.

The main complaints relate to the failure of solicitors to communicate with clients and delays in dealing with the problem. Failure to hand over files and to account properly are also cited, as well as unauthorised action by assistants in solicitors' practices.

The law society has endorsed the recommendations and is promising “appropriate action to ensure they are implemented”. It is considering the issue of a new statutory code of conduct which will deal with complaints handling procedures within firms.

NEW rules covering partnership rescues come into force this week – too late to save Deacon Goldrein Green.

But some leading insolvency practitioners claim changes to the Insolvency Partnership Order could prevent other law firms from collapsing.

The order, which comes into force on 1 December, extends company voluntary arrangement (CVA) procedures to partnerships.

Firms in trouble will be able to use the administration procedure which protects the business until parts of it, or all of it, are sold off, or until debts and assets are realised.

Andrew Laycock, of Leeds-based Carrick Read Insolvency, says: “The idea is to give some protection and therefore a bit of breathing space for the firm.”

Laycock says creditors often see the benefits of allowing businesses to continue if they have a better understanding of the situation. This is more likely to be the case when protection is given.

“The implementation of the order will help the administration of failed partnerships and hopefully enable firms to continue to trade with the approval of creditors,” he says.

But the imminent change in the rules has left collapsed Liverpool firm Deacons'

receivers, Pannell Kerr Forster, in “something of a twilight zone” as the change approaches.

Craig Blakemore, of Liverpool firm Mace & Jones, which is acting for the receivers, says it has been working in “unchartered waters”. However, the new rules lay down procedures for dealing with partnership insolvencies.

A court hearing was due to take place as The Lawyer went to press, at which the receivers were to be given further directions by the court.