In what circumstances can a casual conversation turn in to legal advice? We ask a panel of experts for their thoughts on how lawyers can navigate around the perils of informal advice. The panel: Peter Steel, partner at Bevan Brittan LLP, Richard Moorhead, Professor of Law and Ethics at University College London, and Mark Stobbs, director of legal policy at the Law Society
When does a chat down the pub turn in to legal advice?
Peter Steel: Being asked for informal advice by family and friends is an everyday occurrence for solicitors and other legal professionals. Providing some guidance or advice in such a context is unlikely to cause any problem, but that is not to say it is an entirely risk-free activity. Clearly, there is unlikely to be a formal retainer in such circumstances (though if there were, the informal setting would not relieve the solicitor in question from their Chapter 1 or ‘know your client’ obligations, or indeed any other restrictions on accepting clients imposed by the SRA Code of Conduct or his or her firm or employer).
The law in this jurisdiction does not provide any hard and fast guidance as to when the proverbial chat down the pub becomes legal advice (in the sense of creating obligations between the solicitor and whoever he or she is advising), but there may be some help in the line of cases stemming from Caparo Industries v Dickman [1990] 2 AC 605, [1990] 1 All ER 568 and Hedley Byrne & Co Ltd v Heller & Partners Ltd [1964] AC 465, [1963] 2 All ER 575.
Where a solicitor has assumed responsibility towards someone he advises to the extent that he or she owes them a duty of care, there may also be an inference that the solicitor has assumed some or all of the normal professional obligations he or she would owe to a client. BBCI (Overseas) Ltd (in liquidation) v Price Waterhouse [1998] Lloyd's Law Rep (Banking) 85 sets out the factors that are looked at when assessing whether an advisor has assumed responsibility, which include:
The fact that legal advice was given between friends in an informal situation such as a pub (and where it might have been difficult for the lawyer in question to provide a meaningful disclaimer) would have to be taken into account in deciding whether any duty of care or professional responsibility arose, but this would not necessarily preclude such duties arising.
From a regulatory perspective, the SRA, CILEx and Bar Codes of Conduct still apply in this setting, as they would potentially to any behaviour outside the normal work context. As regards solicitors, the SRA Principles underpin all aspects of ‘practice’ meaning (according to the SRA Glossary) ‘…the activities, in that capacity…of a solicitor…or a lawyer of England and Wales’. So where you are acting as a solicitor, you are potentially subject to the principles and there do not appear to be any exceptions made for when advice is given in a social setting.
Professor Richard Moorhead: The Alistair Brett (Times Newspaper) case shows the perils of advising employees informally or off the record. There a journalist sought off the record advice about hacking a policeman’s email account. Brett offered confidentiality when he could not and got into a situation where there was or may have been a conflict of interest. Other problems led to him being suspended from practice.
Mark Stobbs: While there is nothing wrong with lawyers providing informal legal information and discussion of cases to friends or providing advice on a pro bono basis, there are obvious dangers about too great involvement and about those receiving the information giving greater weight to the advice than is appropriate. The lawyer may not be in possession of the full facts and will almost certainly not be intending to provide advice which should be relied up. There is a spectrum of advice from a discussion of general principles through looking over documents to providing detailed procedural advice.
How should lawyers act when friends ask for legal advice outside of a formal client relationship?
Peter Steel: The risk-free course would be to decline to advise at all in such circumstances, particularly if the question falls outside your field of expertise. That may be a counsel of perfection though. Clearly, indicating where the friend could find appropriate legal advice (eg recommending a firm specialising in the right area) is not likely to cause any problem. You may wish to offer some form of disclaimer to the effect that any other discussion is not to be relied on as legal advice. You may equally wish to be circumspect about discussing anything that might be considered confidential to the friend or doing anything (such as writing to a court on their behalf) that might be interpreted as agreeing to act for the friend. If offering views in an advice column or via an internet forum or similar, you ought to include a disclaimer indicating that your comments are only a very brief commentary on the issues raised and should not be relied on as legal advice—that no liability is accepted for such reliance and that anyone needing such advice should consult a solicitor or other authorised person. Further, if you are employed as a lawyer or are otherwise involved in a legal business you may be well advised to indicate that any views expressed are your own and not those of your employer or firm, to avoid potential difficulties with employers or your firm’s insurers.
Professor Richard Moorhead: There is an interesting case on giving advice pro bono to a client who came in off the street. The Court of Appeal was not impressed by a suggestion that the standard of care should be lower because the person was pro bono (Padden v Bevan Ashford (a firm) [2013] EWCA Civ 824, [2013] All ER (D) 186 (Jul))
Mark Stobbs: There are some obvious common-sense precautions that lawyers can take:
What are the risks of giving informal legal advice? Have there been any examples of lawyers getting in trouble for giving informal advice?
Peter Steel: There is in theory at least a risk of professional sanction or of a claim for negligent advice (or possibly breach of confidence). There does not appear to be much, if any, relevant case law in this jurisdiction (which may indicate the scale of the risk), though Howes v Hinckley & Bosworth Borough Council [2008] UKEAT 0213_08_0407 would suggest that even advice given informally by a lawyer may be considered as being given in his or her professional capacity. In this case, an employee had sought disclosure of legal advice given to her employer in relation to a formal grievance. The employee contended that the advice was not protected by legal advice privilege because the solicitor, from whom the employer obtained the advice, was acting as an employment consultant and not in his capacity as a solicitor. She argued that this was comparable to a solicitor offering advice to a friend outside a professional relationship. The EAT accepted that if the solicitor instructed by the employer had provided advice in his professional capacity that advice would be protected from disclosure. It also acknowledged that although there could be circumstances in which a qualified lawyer might offer legal advice in some other capacity, there is a presumption that it is offered professionally if he or she is practising as a solicitor. It was held that despite the fact the advice was not given in the capacity of a qualified solicitor, it did attract legal advice privilege. Again this supports the view that professional obligations could arise as a result of the chat down the pub.
Perhaps inevitably, the US offers many more examples of lawyers being pursued for damages as a result of informal legal advice—for example, Togstad v Vessely 291 N.W.2d 686 (Minn. 1980) in which a lawyer, after consulting with a prospective client, declined to take a case, but added gratuitously that he did not think the case was worth pursuing. This proved to be incorrect advice. However, by the time the client had discovered she had a valid claim, she was out of time to bring it. She successfully sued the lawyer for damages for legal malpractice.
Professor Richard Moorhead: It’s possible to conceive of situations where advice given informally to a friend is relied on, and where the lawyer accepts it will be relied on. The friend de facto becomes a pro bono client. In those circumstances there may be a risk of liability, I suppose. Common sense, candour and friendship would push in the same direction. If your friend needs proper legal advice and you cannot provide it competently then the right thing to do is to counsel them on what they do need and how to get it.
Mark Stobbs: In practice, we are not aware of solicitors being caught out either through negligence claims or regulatory action and we suspect that the courts and regulators will be easily able to recognise on the facts of each case whether or not the solicitor was acting as such or simply giving an informal discussion which was not intended to be relied on.
Solicitors Regulation Authority: As far as the risks are concerned, we’d expect any solicitor at all times to have regard to the Principles of the Code of Conduct—for example that they uphold the rule law (Principle 1) or act in the best interests of each client (Principle 4).
Any disciplinary action against a solicitor for failing to uphold the Principles in such instances would be recorded as ‘breach of Principle 4’ and not ‘didn’t give proper informal legal advice’, so we wouldn’t have any data around such breaches.
What is the position of the regulators on the giving of informal advice?
Peter Steel: An informal poll of a sample of legal regulators suggests that lawyers will still have to have regard to their professional codes in such situations. Both the SRA and CILEx professional ethics teams offered the view that a solicitor or legal executive would be bound by their respective codes of conduct even when giving informal advice.
Professor Richard Moorhead: Unless one was taking advantage of a friend in some way, or doing something which called into question one’s integrity, then I don’t see the regulator having any role unless the informal conversation in fact assumed the nature of a lawyer client relationship.
Interviewed by Anne Bruce.
The views expressed by our Legal Analysis interviewees are not necessarily those of the proprietor.
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