A solicitor, as an officer of the Court, is subject to the Court's inherent jurisdiction. As such, a solicitor can be summarily compelled to comply with an undertaking which they have given. Failure to make good a solicitors' undertaking may be regarded as misconduct.

For an undertaking to be a solicitors' undertaking, it must  have been given by the solicitor in their capacity as a solicitor.

Harcus Sinclair LLP v Your Lawyers Ltd [2021] UKSC 32 concerned a non-disclosure agreement between two firms of solicitors in relation to a formal collaboration agreement for a group action. The Supreme Court considered the term of the non-disclosure agreement, whereby Harcus Sinclair agreed to not accept instructions , or to act on behalf of any other group of Claimants, in the contemplated group action.

The Court found that this term was not a solicitor's undertaking, rather that the subject matter of the undertaking was a business arrangement, not involving legal activity.

The Court provided further guidance on determining if an undertaking was  given in capacity as a  solicitor;

(1) What is the subject matter of the undertaking? Does it require the solicitor to do something which is in the course of their ordinary professional practice; and

(2) What is the reason for giving the undertaking and to what extent does the cause to which it relates involve the work which solicitors carry out as part of their ordinary legal practice?

However, it is the obiter commentary that has been the source of apprehension and specifically that, even had the undertaking been a solicitors' undertaking on the part of Harcus Sinclair LLP , it could not be enforced (on these specific facts) as it was not given by the solicitor in a personal capacity, but rather on behalf of the LLP. By signing on behalf of the LLP, the solicitor incurred no personal liability and the Court held that LLPs are not subject to the Court's inherent jurisdiction to  enforce undertakings. The legislation which created  the ability for corporate entities fails to address whether LLPs are subject to the Court's supervisory authority.

Whilst the disparity in the rules remains  unsatisfactory, it is not the case that the undertakings are unenforceable; only that the Court does not have the inherent jurisdiction to enforce comparatively to when a solicitor gives an undertaking in their professional capacity. The Legal Sector's initial response is generally that undertakings in relation to the conveyancing process remain enforceable but other routes will need to be utilised to attain compliance (for example breach of contract)- potentially increasing the time required and consequentially the cost. Of course it remains possible for the SRA (SDT) to  commence regulatory action against a solicitor and LLP for failure to comply with an undertaking but without the ability to award compensation.

It remains to be seen if the Law Society will comment and if Parliament will review the current legislation. Neither of which are likely to happen expeditiously. In the short term, we anticipate that our solicitor clients may be asked to give personal undertakings in addition to in the alternative undertakings by the LLP. Some firms may resist the requirement that they give a personal  undertaking.

We recommend that firms give consideration to explaining to the clients to the associated risks of proceeding without a personal undertaking comparatively to an  undertaking given by an LLP or Ltd entity. It may be prudent to give consideration to the status of the firm which they are dealing with. A failure to appreciate the potential limits of undertakings has the potential to expose the firm to claims.

You can read our recently published briefing note on the case here. 

Our Claims Advocates are happy to discuss this matter with you in further detail should it be of assistance.