Many thanks to Robert Forman, senior consultant at Murdochs Professional Discipline Solicitors, who joined Fox & Partners’ Catriona Watt, Caroline Field and Eleanor Diamond at the recent Fox Breakfast Briefing: Conducting internal investigations in law firms.
Our expert panel took attendees through a case study in the context of sexual misconduct and sex discrimination, dealing with issues arising from the perspectives of the firm, the complainant, the subject of the investigation and the regulator.
Below we have summarised some key points raised by our expert panel and you can watch the recording of the full webinar here.
- There is no one size fits all for undertaking an internal investigation. Assuming a substantive investigation is required, the firm should ensure clarity at the outset in respect of: its aims and objectives, terms of reference, scope, methodology and the issues to be decided.
- Planning is key. The firm’s early considerations should include: what documents are needed; will witnesses be interviewed and will their evidence be recorded; are there relevant processes that need to be followed. Thorny issues around confidentiality and privilege should also be considered at the outset.
- The firm should consider carefully who will undertake the investigation; is there someone who will meet the requirements of independence and impartiality. If not, consider engaging an external investigator.
- From a regulatory perspective, firms should look to rule 2 of the SRA Code of Conduct for Firms which requires effective governance structures, arrangements, systems and controls including monitoring and managing risks. This applies in the context of Principle 6 (regulated parties must act in a way which encourages equality, diversity and inclusion) and Principle 5 (regulated parties must act with integrity). On 8 February 2022, the SRA published their Workplace Culture Thematic Review indicating its expectation of firms to create and maintain the right culture and environment for the delivery of competent and ethical legal services to clients.
- When considering the threshold for reporting misconduct, the focus is any serious misconduct the SRA might want to investigate. Firms do have time to investigate before reporting. From the regulator’s perspective, identifying where (if) they have gone wrong and how they intend to put things right is often as important as actions taken to avoid issues in the first place.
- As part of any investigation it commences, the SRA is permitted to see all documents, except privileged advice received in respect of the firm’s regulatory response.
- Complainant employees/partners should carefully consider the risks before removing documents from the firm even if it is for the purpose of obtaining legal advice, which may give rise to cause for complaint and action by the firm (see Nissan v Passi [2021] EWHC 3642 (Ch)).
- In considering this issue, the SRA will be interested where client confidentiality has been breached, it will take into account: a) what the firm’s policy was in relation to taking documents home and whether the partner kept the documents secure; and b) was the partner acting in good faith in removing the documents.
- The firm should not react in haste when dealing with a complainant partner who has removed documents from the office, particularly against the backdrop of sexual misconduct and sex discrimination allegations. Rather, the firm should seek relevant explanations and assurances for the documents to be returned or kept secure.
- The obligation to report is rule based, the threat of a report should not be used as an improper tool of commercial litigation. The SRA will be more concerned where there is a condition linked to the threat.
- Where relationships have broken down, there may be benefits for all parties in reaching agreement which involves an individual leaving and avoiding an investigation. However, wider cultural implications of this should be borne in mind, together with the separate reporting obligations and terms which can be offered as part of any settlement to offer comfort to all parties.
For further information or questions, please get in touch with us at events@foxlawyers.com.
