The Solicitors Regulation Authority will impose no penalty on a firm that did not report the conduct of a junior solicitor which led to her being struck off.
Instead the regulator has written to Capsticks - its own appointed legal adviser - reminding the firm of its reporting obligations.
The Solicitors Disciplinary Tribunal opted to strike off Claire Matthews following a four-day hearing earlier this year, after finding that she lied to colleagues about leaving sensitive documents on a train.
But it emerged in the recently-published tribunal judgment that her former employer Capsticks did not report Matthews’ conduct to the regulator. The firm had reported, as required, the loss of the documents, but the tribunal noted that neither Capsticks nor Matthews had voluntarily notified the SRA of the facts and circumstances giving rise to her misconduct.
Instead, the tribunal stated that the later investigation of Matthews’ case concerning regulatory conduct was instigated following a complaint made by a person named in the documents. During cross-examination, Capsticks partner Tracey Lucas confirmed the firm had not reported the matter to the SRA on the basis of Matthews’ dishonesty or in any regulatory capacity relating to her conduct.
Matthews, who represented herself at the tribunal, submitted that the decision not to report the matter should be considered a factor in finding misconduct allegations not proven.
All regulated firms, according to the SRA’s reporting obligations, must report any facts or matters that could amount to a serious breach of rules by any of their staff. Firms must report promptly ‘any facts or matters that you reasonably believe should be brought to our attention’, so that the SRA may investigate whether any breach has occurred.
The SRA has confirmed to the Gazette it has contacted Capsticks over the issue but will take no further action.
An SRA spokesperson said: 'There was a delay in Capsticks providing us with the information we needed to investigate a potential misconduct issue. We investigated this issue and wrote to Capsticks to remind the firm of its obligations to promptly report possible misconduct.'
Capsticks declined to comment. The firm is appointed as the SRA’s sole legal provider for disciplinary and litigation work. It has worked with the regulator since 2009, remaining on a panel following a tender in 2013 and becoming the sole provider in 2017.
The SRA did not use Capsticks for the prosecution because of a potential conflict of interest, instead retaining City firm Fieldfisher.
Following the decision to strike off Matthews, the SRA claimed for £55,000 in costs. The tribunal considered the hourly rates claimed – up to £380 for a panel solicitor compared with Capsticks’ usual hourly rate of £130 – were 'too high' and that they effectively penalised Matthews for Capsticks being conflicted. The tribunal said costs should instead be £18,000, reduced to £10,000 because of her limited means.
The SRA has confirmed it has no plans to investigate Fieldfisher over the tribunal’s remarks, saying the firm did not claim for work not carried out or mislead anyone about the expertise required.
The Gazette understands lawyers offering to work pro bono on an appeal have made contact with Matthews, who now works in an NHS call centre. A decision on whether to challenge the tribunal’s decision must be made today.