Isle of Man: Legal Profession
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Isle of Man Information: Business, Taxation and Offshore
On this Page:
- Isle of Man Structure
and Regulation of the Legal Profession
- Isle of Man Codes of Conduct
and Disciplinary Proceedings
- Isle of Man Solicitors'
Accounts' Rules
- Isle of Man Fees and Disputes
- Isle of Man Recent Trends
Isle of Man Structure and Regulation of the Legal Profession
The Island's High Court judges are the two Deemsters, who
have jurisdiction over all the criminal and civil matters
that in England would fall under the High Court, Crown Court
and County Court.
The Manx Appeal Court, consists of the Deemsters and the
Judge of Appeal, a part-time position filled by an English
QC. The final court of appeal is the Judicial Committee of
the Privy Council in London.
The Island has its own lay magistrates (similar to their
English counterparts) and also two stipendiary magistrates
(the High Bailiff and Deputy High Bailiff) who also act as
coroners of inquest and preside over the licensing court.
Members of the Island's bar are called advocates; they are
a fused profession, combining the functions normally carried
out by English barristers and solicitors, and following professional
standards set by the Isle of Man Law Society.
It has been a long-standing practice for senior English barristers
to appear in Manx courts, after being granted a 'temporary
advocate's commission', but this trend is now in decline as
local expertise in complex litigation cases improves.
To be admitted as a Manx advocate, a person is required
to have successfully completed the academic training necessary
for admission as a solicitor in England and Wales and the
Manx Law Examinations, and to have completed a period of two
years' articles (analogous to the English training contract)
with a local firm. Manx Advocates may employ, but not enter
into partnership with, lawyers qualified in other jurisdictions.
The Manx Law Society is, however, currently considering the
introduction of multi-qualified partnerships.
Legislation was passed in 1986 allowing law practitioners
qualified in other jurisdictions to practice as registered
legal practitioners and advise on commercial law and international
taxation, but it excludes them from conducting proceedings
in Manx courts and certain tribunals or to prepare documents
relating to Manx real estate. In effect, local firms have
a monopoly on local litigation and property work and as a
result only a few foreign law firms have established a presence
in the Island, specialising in commercial and offshore private
client work.
The admittance and qualifications of lawyers is governed
by the Advocates Act 1995 (Part II) which replaces most parts
of the Advocates Acts 1826-1976. Further regulations were
laid down under the Advocates Regulations 1998, setting out
qualification requirements. Sections 15-17 of the 1995 Act
allow for the issue of a temporary advocate's licence to non-Manx
lawyers provided that:
-
he/she is a member of the Bar of England
and Wales, Scotland or Northern Ireland;
-
no Manx advocate is available for the
proceedings; or
-
he proceedings require knowledge and experience
of a nature not ordinarily available in the Island.
Notaries play an important role in the Manx
legal system and are regulated under Part III of the Advocates
Act 1995.
Law firms are required to be licensed if giving investment
advice. As with the offshore jurisdictions, law firms tend
to have associate fiduciary companies and therefore it is
common for legal advisers to also act as investment advisers.
However, advocates are exempted from the requirement to
be separately licensed by the Financial Supervision Commission
in the conduct of investment business by virtue of membership
of the Isle of Man Law Society, provided they obtain an appropriate
certificate from the Law Society and comply with the Law Society's
Investment Business Rules 1993.
In 2008 there were 171 practising Advocates, 17 non-practising
Advocates, 4 associate members and 32 student members.
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Isle of Man Codes of Conduct and Disciplinary Proceedings
These are set out in the Advocates Disciplinary Rules 2009.
The Advocates Disciplinary Tribunal Guidance Notes have been
produced to provide general information regarding the procedures
adopted in dealing with formal complaints about advocates’professional
misconduct. Where the rules are silent, the Isle of Man Law
Society will tend to look for guidance from the equivalent
English provision. As with the Channel Islands, difficulties
may arise where the rules conflict. Additional information
can be obtained from the Law Society.
As in other small legal markets, issues of conflict may arise
during the course of obtaining legal or investment advice.
The rules relating to conflict of interest are essentially
the same as those applying to solicitors in England, ie it
is not acceptable to have lawyers from the same firm acting
for different parties to the same transaction.
With regard to confidentiality, there are no specific statutory
provisions. The position in the Isle of Man is basically the
same as that pertaining in England:
-
codes of practice affirming client confidentiality;
-
express/implied term of contract between
advocate and his client;
-
equitable duty of confidence;
-
legal professional privilege.
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Isle of Man Solicitors' Accounts' Rules
Professional indemnity insurance is mandatory in the Isle
of Man. There is no client compensation fund.
The holding of client money is regulated by the Isle of Man
Law Society's Advocates' (Accounts) Rules 1993, which are
similar to the English Solicitors' Accounts Rules and stipulate
that client money be held in a designated client account.
Rules also cover a client's entitlement to interest.
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Isle of Man Fees and Disputes
Notarial fees, where relevant, are included in the final
bill to the client. Neither percentage nor contingency fees
apply.
Given the diversity of work and expertise in the Isle of
Man, billing rates differ widely depending on the nature of
the work undertaken, whether it is domestic or international
or which firm is acting. Leading firms advising on international
transactions charge approximately GBP225-GBP275 per hour for
a partner, and GBP150 per hour for a fee-earner.
The Advocates Act 1995 introduced a new regime for the assessment
of Advocate's fees. Under Part III of the 1995 Act, advocates
are under a duty to provide all clients with a written estimate
of fees likely to be payable on an ongoing basis. Clients
are also entitled to a written detailed breakdown of the fees
payable. New clients may be asked to give money on account.
General complaints in respect of an advocate's professional
conduct are dealt by the Advocates Disciplinary Tribunal,
a body set up under the Advocates (Disciplinary) Rules 1997,
updated by the Advocates Disciplinary Rules 2009.
The Tribunal is unable to deal with matters of negligence
(a matter for the court), compensation claims or disputes
as to fees (see below). The Tribunal may dismiss the complaint
or, if proved, reprimand the advocate or order the advocate
to pay the Treasury a penalty not exceeding GBP2,000. Very
serious breaches of professional conduct may be referred to
the Lieutenant Governor.
In the case of a dispute as to fees, the client may seek
taxation by the Taxing Master. The Taxing Master assesses
a bill of costs in accordance with the Advocates' Scale of
Fees. Although the Taxing Master acts within the framework
of the court system, and the taxation system is primarily
used to assess litigation costs, theoretically any bill of
costs, contentious or non-contentious, may be taxed. Accordingly,
in the areas of international corporate and commercial work,
advocates tend to ensure that clients are aware that fees
will be charged on a time basis at an hourly rate.
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Isle of Man Recent Trends
The Advocates Act 1995 has not changed the current controversial
rule that advocates and registered legal practitioners cannot
be partners in the same firm. The rules are in effect contrary
to EU equal treatment provisions. Increasingly, local law
firms are employing English-qualified lawyers at below partner
level.
In terms of the Island's legal market, leading advocates
report a continuing healthy domestic and international workload.
In particular, there has been an increase in all areas of
substantive international financial and corporate work including:
- asset finance (ships and aircraft)
- securitisation;
- securities offerings;
- investment funds and asset management;
- ship management;
- corporate and banking transactions.
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