S.I. No. 429/2020 - Solicitors Professional Indemnity Insurance Regulations 2020

Notice of the making of this Statutory Instrument was published in

“Iris Oifigiúil” of 13th October, 2020.

ARRANGEMENT OF REGULATIONS

CONTENTS

	Page No
1. CITATION:	1
2. INTERPRETATION:	1
3. FIRM:	25
4. MAINTENANCE OF INSURANCE:	25
5. SELF-INSURED EXCESS ON QUALIFYING INSURANCE:	28
6. ESTABLISHMENT OF SPECIAL PURPOSE FUND:	28
7. MAINTENANCE OF INSURANCE IN RUN-OFF:	29
8. DEFAULTING RUN-OFF COVER:	30
9. ENTERING THE RUN-OFF FUND:	31
10. COMPLIANT AND NON-COMPLIANT RUN-OFF FIRMS	33
11. ARBITRATION	35
12. ENTERING THE ASSIGNED RISKS POOL:	36
13. OPERATION OF ARP COVERAGE:	39
14. MEMBERSHIP OF THE ASSIGNED RISKS POOL:	40
15. VARIATION OF THE MINIMUM TERMS AND CONDITIONS IN RESPECT OF COVER GRANTED BY THE ASSIGNED RISKS POOL:	40
16. DEFAULTING FIRMS:	41
17. INSOLVENCY OF PARTICIPATING INSURERS AND OTHER EVENTS:	42
18. RISK MANAGEMENT AUDITS:	43
19. RISK MANAGEMENT AUDIT REPORTS:	45
20. RESPONSIBILITIES OF PRINCIPALS:	47
21. PROFESSIONAL INDEMNITY INSURANCE COMMITTEE:	48
22. SPF MANAGEMENT COMMITTEE:	51
23. PROVISION OF INFORMATION AND CO-OPERATION WITH QUALIFYING INSURERS AND SPF MANAGER:	52
24. AMENDMENT TO INDEPENDENT LAW CENTRES REGULATIONS:	53

ARRANGEMENT OF SCHEDULE

CONTENTS

	Page No
Table of Revocations	55
APPENDIX 1 Minimum Terms and Conditions of Professional Indemnity Insurance for Solicitors in Ireland	56
INTERPRETATION:	56
SCOPE OF COVER:	65
MINIMUM LEVEL OF INSURANCE COVER:	69
SELF-INSURED EXCESS:	70
SPECIAL CONDITIONS:	71
EXCLUSIONS:	73
GENERAL CONDITIONS:	80
DISPUTE RESOLUTION:	82
APPENDIX 2 Risk Management Audit Terms of Reference	85

THE LAW SOCIETY OF IRELAND, in exercise of the powers conferred on it by section 26 of the Solicitors (Amendment) Act 1994 , hereby makes the following Regulations:-

1.

1. Citation:

• (a) These Regulations may be cited as Solicitors Professional Indemnity Insurance Regulations 2020.

• (b) These Regulations shall come into operation on 1 December 2020.

• (c) The regulations listed in the Schedule to these Regulations shall cease to have effect from 23:59:59 on 30 November 2020 to the extent set out in the Schedule.

2.

2. Interpretation:

• (a) In these Regulations, the following terms shall have the following meanings—

“additional ARP premium” has the meaning ascribed to it in Regulation 12(e)(ii);

“ARP” means the assigned risks pool;

“ARP coverage” means an arrangement for indemnification issued by the SPF manager on behalf of those participating insurers that participate in the assigned risks pool in respect of the indemnity period in which the coverage incepts and incorporating the minimum terms and conditions as varied by these Regulations but shall not include coverage issued to a defaulting firm through the assigned risks pool;

“ARP default premium” means the sums payable by a defaulting firm for any coverage arranged pursuant to Regulation 16(a) from time to time;

“ARP eligibility criteria”, in relation to a firm other than a legal partnership or a multi-disciplinary practice, means that the firm does not hold qualifying insurance with a participating insurer and:-

• (i) (a) in respect of a firm that held ARP coverage from the assigned risks pool for the indemnity period which commenced on 1 December 2010, that the firm has not been in the assigned risks pool for more than 24 (twenty four) of the 60 (sixty) months preceding the date of its application to enter the assigned risks pool and is not a succeeding practice to such a firm; or

• (b) in respect of all other firms, that the firm has not been in the assigned risks pool for more than 12 (twelve), or such other period [not to exceed 24 (twenty four) months] as the PII Committee may from time to time determine, of the 60 (sixty) months preceding the date of its application to enter the assigned risks pool and is not a succeeding practice to such a firm; and

• (ii) in respect of a firm which commenced practice on or subsequent to the operative date, it established qualifying insurance with a participating insurer or more than one (1) participating insurer with effect from the date of commencement of its practice; and

• (iii) that no direction in relation to the firm is in effect pursuant to Regulation 18(g) or Regulation 19(e)(iv); and

• (iv) that the firm is not a defaulting run-off firm;

“ARP eligibility dispensation” means, in respect of any firm other than a legal partnership or multi-disciplinary practice, a dispensation under Regulation 12(b);

“ARP eligible firm” means a firm other than a legal partnership or multi-disciplinary practice that satisfies the ARP eligibility criteria or in respect of which an ARP eligibility dispensation is in effect;

“ARP premium” means, in respect of each firm other than a legal partnership or multi-disciplinary practice which has been issued with an ARP coverage, the initial ARP premium and the additional ARP premium in respect of an indemnity period (or part thereof);

“ARP premium schedule” means the schedule to be determined by the PII Committee and published by the Law Society from time to time which sets out the terms pursuant to which premium levels, in respect of firms other than legal partnerships or multi-disciplinary practices which are issued with coverage in the assigned risks pool, are to be determined by the SPF manager in accordance with these Regulations;

“ARP run-off cover” means run-off cover from the run-off fund on like terms and conditions to ARP coverage;

“ARP run-off eligibility criteria” means in relation to a firm other than a legal partnership or a multi-disciplinary practice:-

• (i) a firm which held ARP coverage on the date of cessation of its practice; and

• (ii) in respect of a firm which held ARP coverage prior to the operative date, continued to satisfy the ARP eligibility criteria on the operative date; and

• (iii) a firm in respect of which there is no succeeding practice; and

• (iv) a firm which is not a defaulting firm;

• (v) Where the firm has been authorised as a limited liability partnership, each and every principal of the firm, prior to ARP run-off cover being arranged, irrevocably and unconditionally agrees, accepts and guarantees that, notwithstanding the firm’s status as a limited liability partnership, the principals of the firm shall be personally liable, jointly and severally in respect of any liability arising under Regulation 9(f), if applicable, and in respect of any liability that may arise against the principals of the firm under Clause 8 of the ARP Run-off Minimum Terms and Conditions.

“ARP run-off eligible firm” means a firm other than a legal partnership or a multi-disciplinary practice which satisfies the ARP run-off eligibility criteria;

“assigned risks pool” means the assigned risks pool referred to in Regulation 8 through which an ARP eligible firm or a defaulting firm may obtain or be granted coverage that incorporates the minimum terms and conditions as varied by these Regulations;

“authorised insurer” means an insurer that holds an authorisation to carry on insurance business for the purposes of Directive 2009/138/EC or that is otherwise entitled to carry on non-life assurance business in the State;

“claim” means a request or demand for, or an assertion of a right to, or an intimation of an intention to seek:-

• (i) civil compensation of any nature or civil damages of any nature; or

• (ii) any award to be made pursuant to the provisions of the Solicitors Acts 1954 to 2015, the Legal Services Regulation Act 2015 , or any regulations made thereunder, for compensation or restitution to clients or any other obligation that may be imposed on solicitors or registered lawyers to compensate or make restitution to clients by statute from time to time, but for the avoidance of doubt, the term “claim” does not include any claim for the payment of costs incurred by any insured in defending or resisting proceedings seeking an award against that insured of the nature described in this sub-paragraph (ii) where the insurance, in accordance with the minimum terms and conditions, excludes the insurer’s liability to indemnify the insured in respect of such costs.

For the purposes of sub-paragraph (ii) above, the discharge of an obligation of an insured, following receipt by an insured of a notification of a requirement to rectify, shall be treated as a “claim” (subject to the provisions of the regulations and/or minimum terms and conditions) notwithstanding that a formal award pursuant to the provisions of the Solicitors Acts 1954 to 2015, the Legal Services Regulation Act 2015 , or any regulations made thereunder, has not been made;

“client account” shall have the same meaning as prescribed in the Solicitors Accounts Regulations or the meaning prescribed in any statute or statutory instrument amending or replacing the Solicitors Accounts Regulations;

“close of practice guidelines” means the close of practice guidelines to be published by the PII Committee from time to time;

“Commercial Property Regulations” means the Solicitors (Professional Practice, Conduct and Discipline — Commercial Property Transactions) Regulations 2010;

“compliant run-off firm” means a run-off firm which is designated as a compliant run-off firm by the SPF manager pursuant to Regulation 10(a) or 10(b);

“compliant run-off firm eligibility criteria” means, in relation to a run-off firm, a run-off firm which:

• (i) (a) complies with the close of practice guidelines; and

• (b) notifies the SPF manager of its intention to cease practice in accordance with Regulation 9(a); and

• (c) sends its most recently completed proposal form to the SPF manager in accordance with Regulation 9(a); and

• (d) ceases to practice on the date specified in the written notice of its intention to cease practice provided by the firm to the SPF manager; and

• (e) complies with the ROF risk management audit under Regulation 9(a)(ii); or

• (ii) ceases to practise due to the death of a principal of the firm who was in practice at the time of his or her death or the critical illness of a principal of the firm who was in practice at the time he or she became critically ill; or

• (iii) ceases to practise due to occurrence of matters personal to the sole principal of the firm which, in the opinion of the SPF Manager, did not allow sufficient time for the firm to comply with the criteria listed in (i)(a) to (d) above, including, but not limited to, the appointment of the sole principal of the firm to the judiciary or other public office or the election of the sole principal to public office; or

• (iv) ceases to practise due to the suspension or strike-off of the sole principal from practice and:

• (a) complies with the close of practice guidelines; and

• (b) notifies the SPF manager of its intention to cease practice prior to the end of the indemnity period in which it ceases to practice; and

• (c) sends its most recently completed proposal form to the SPF manager prior to the end of the indemnity period in which it ceases to practice; and

• (d) ceases to practise on the date specified in the written notice of its intention to cease practice provided by the firm to the SPF manager; and

• (e) complies with the ROF risk management audit under Regulation 9(a)(ii).

“Council” means the council of the Law Society;

“coverage period” means the period for which the qualifying insurance or the ARP coverage (as the case may be) held by a firm affords cover;

“defaulting firm” means a firm other than a legal partnership or a multi-disciplinary practice that does not hold qualifying insurance and which falls within one (1) of the following categories:

• (i) in the case of a firm that is an ARP eligible firm, it has failed to make an application to be admitted into the assigned risk pool prior to the start of any relevant indemnity period or immediately prior to the expiry of its coverage period, whichever is the earlier; or

• (ii) in the case of a firm that is not an ARP eligible firm, it is a firm that is carrying on a practice without qualifying insurance; or

• (iii) a firm designated as a defaulting firm pursuant to Regulation 12(h);

“defaulting run-off firm” means a firm other than a legal partnership or multi-disciplinary practice that ceases a practice in circumstances where it is required pursuant to these Regulations to establish and maintain run-off cover, but where it is neither an ROF eligible firm nor an ARP run-off eligible firm and does not obtain run-off cover from a participating insurer (and a firm on whose behalf the SPF manager makes arrangements for run-off cover to be extended to that firm following the cessation of its practice, through the run-off fund, because it is neither an ROF eligible firm nor an ARP run-off eligible firm and does not obtain run-off cover from a participating insurer shall be regarded as a defaulting run-off firm);

“defence costs” mean legal costs and disbursements and investigative and related expenses reasonably and necessarily incurred with the consent of a participating insurer (such consent not to be unreasonably withheld) in relation to a claim including without limitation the costs of:-

• (i) defending any proceedings; or

• (ii) conducting any proceedings for indemnity, contribution or recovery; or

• (iii) investigating, reducing, avoiding or compromising any actual or potential claim;

but the term “defence costs” does not include:-

• (a) any internal overhead expenses of a firm or a participating insurer or the cost of any insured’s time; or

• (b) any costs incurred by an insured in defending or resisting proceedings seeking an award against that insured of the nature described in paragraph (ii) under the definition of “claim” where the qualifying insurance, in accordance with the minimum terms and conditions, excludes a participating insurer’s liability to indemnify an insured in respect of such costs;

“distressed firm” means a firm other than a legal partnership or a multidisciplinary practice where a firm has ceased practice as a result or consequence of an order striking off or suspending each and every principal of a firm, an order suspending each principal’s practising certificate or the abandonment of the practice by the principal(s) of the firm within the meaning of the Solicitors Acts 1954-2015;

“distressed firm premium” has the meaning assigned to it in Regulation 7(d);

“earlier regulations” means the 1995 Regulations, the 2007 Regulations, the 2011 Regulations, the 2014 Regulations, the 2016 Regulations, the 2017 Regulations, the 2018 Regulations and the 2019 Regulations;

“financial institution” means any of the following:-

• (i) a credit institution as defined in section 2(1) of the Consumer Credit Act 1995 (as amended); or

• (ii) a credit institution that is the holder of an authorisation for the purposes of Article 3(1) of Directive 2013/36/EU; or

• (iii) a retail credit firm authorised pursuant to section 31 of the Central Bank Act 1997 (as amended); or

• (iv) a home reversion firm authorised pursuant to section 31 of the Central Bank Act 1997 (as amended); or

• (v) any other party that engages on a professional basis in the business of providing financial accommodation of any nature to another person; or

• (vi) any assignee of debt from an entity that has been engaged in the business of providing financial accommodation of any nature to another person, including without limitation, NAMA;

but, for the avoidance of doubt, does not include a Minister of the Government in the exercise of the functions, powers or duties of his office;

“firm” means:-

• (i) any partnership of two (2) or more solicitors or registered lawyers (as constituted from time to time, whether before or during any relevant indemnity period); or

• (ii) a legal partnership (as constituted from time to time, whether before or during any relevant indemnity period), where such partnership includes at least one (1) solicitor or registered lawyer; or

• (iii) a multi-disciplinary practice (as constituted from time to time, whether before or during any relevant indemnity period), where such multidisciplinary practice includes at least one (1) solicitor or registered lawyer; or

• (iv) any sole practitioner being either a solicitor or registered lawyer, and including a sole practitioner who employs one (1) or more solicitors or registered lawyers, and a sole practitioner who, although having established a practice, is employed by a person who is not a solicitor or registered lawyer, or

• (v) a limited liability partnership, where such partnership includes at least one (1) solicitor or registered lawyer;

where the relevant partnership or relevant sole practitioner, as the case may be, carries on a practice;

“firm’s practice” means the practice carried on by a firm, and includes the business of any trustee, nominee, service or administration company owned, in whole or in part, by one or more of the principals of the firm;

“indemnity period” means any period of one (1) year starting on 1 December in each year;

“initial ARP premium” has the meaning ascribed to in Regulation 12(e)(ii);

“insolvency event” means, in relation to a participating insurer:-

• (i) the appointment of a liquidator, receiver, administrative receiver, administrator or examiner to the participating insurer (or an analogous appointment being made in respect of the participating insurer in any jurisdiction outside the State); or

• (ii) the passing by the members of a participating insurer of a resolution for a voluntary winding up (or an analogous step being taken in relation to a participating insurer in any jurisdiction outside the State); or

• (iii) the making of a winding up order in relation to a participating insurer (or an analogous order being made in relation to a participating insurer in any jurisdiction outside the State); or

• (iv) the approval of a voluntary arrangement or similar form of composition with creditors in respect of a participating insurer (or an analogous event occurring in relation to a participating insurer in any jurisdiction outside the State);

but, for the avoidance of doubt, an insolvency event does not occur unless so declared by the PII Committee;

“insurance” means the professional indemnity insurance or coverage required by each firm pursuant to the Regulations;

“insured” means, in respect of a firm:-

• (i) the firm; or

• (ii) each trustee, nominee, service or administration company owned, in whole or in part, by the firm and/or one or more of the principals of the firm from time to time; or

• (iii) each director, officer or employee of any such company as is referred to in paragraph (ii) above from time to time; or

• (iv) each principal or former principal of the firm from time to time; or

• (v) each employee or former employee of the firm from time to time; or

• (vi) the estate or legal personal representatives of any deceased former principal or employee of the firm;

“insurer” means the underwriter of the insurance or the provider of the coverage the subject of the minimum terms and conditions;

“insurer reimbursement claim” means a claim maintained and upheld against a participating insurer, by a claimant other than a financial institution, which would have been paid by a participating insurer:-

• (i) in circumstances where if that claimant had been a financial institution, the participating insurer would have been entitled to exclude liability for the claim in accordance with clause 6.15 of the minimum terms and conditions; and

• (ii) the participating insurer has not recovered the full extent of the sums paid by it by way of a claim for reimbursement pursuant to clause 7.2 of the minimum terms and conditions;

“investment advice” has the meaning given in the Investment Intermediaries Act 1995 ;

“investment business service” has the meaning given in the Investment Intermediaries Act 1995 ;

“Law Society” means the Law Society of Ireland;

“legal partnership” has the meaning assigned to it by the Legal Services Regulation Act 2015 ;

“legal services” means services of a legal or financial nature and includes any part of such services, and for the avoidance of doubt, includes (without limitation):-

• (i) any investment business services, or investment advice provided by a firm; and

• (ii) acting as personal representative or trustee; and

• (iii) acting as notary public; and

• (iv) acting as a commissioner for oaths; and

• (v) acting as liquidator or receiver; and

• (vi) acting as company secretary; and

• (vii) acting as director of any body corporate owned in whole or in part by one or more of the principals of a firm that provides trustee, nominee, administration or other similar services; and

• (viii) acting as arbitrator, mediator, expert determiner, adjudicator, or conciliator; and

• (ix) acting on a pro bono basis; and

• (x) acting as personal insolvency practitioner; and

• (xi) acting as an expert witness and/or providing opinions as a professional expert; and

• (xii) acting as a patent agent; and

• (xiii) acting as a registered trade mark agent; and

• (xiv) acting as a European trade mark & design attorney;

“limited liability partnership” has the meaning assigned to it by the Legal Services Regulation Act 2015 ;

“minimum common risk management standard” means the minimum common risk management standard or any equivalent by whatever name called published by the Law Society (in terms approved by the PII Committee) from time to time or if none is published or in force then as shall be determined by the SPF management committee;

“minimum terms and conditions” means the minimum terms and conditions set out in Appendix 1 to these Regulations with which a qualifying insurance (or, in the case of a qualifying insurance provided as a co-insurance, any part thereof) underwritten by a participating insurer is required by these Regulations to comply, or in the case of ARP coverage and run-off cover, such minimum terms and conditions, as varied by or pursuant to these Regulations, to apply in respect of such cover;

“misconduct” has the meaning given in section 3 of the Solicitors (Amendment) Act 1960 ;

“multi-disciplinary practice” has the meaning assigned to it by the Legal Services Regulation Act 2015 ;

“NAMA” means the National Asset Management Agency;

“non-compliant firm premium” has the meaning assigned to it in Regulation 10(f);

“non-compliant run-off firm” means a run-off firm which is designated as a non-compliant run-off firm by the SPF manager pursuant to Regulation 10(a) or 10(c);

“non-performance event” means, in relation to a participating insurer the loss by that participating insurer of its ability to lawfully fulfil any obligations undertaken by it in respect of qualifying insurance in the State (whether by withdrawal or qualification of its authorisation to do so or otherwise) but, for the avoidance of doubt, a non-performance event does not occur unless so declared by the PII Committee;

“notification of a requirement to rectify” means a notice in writing (including email) from the Registrar of Solicitors or from such other person as may be appointed by the Law Society for that purpose:-

• (i) notifying an insured that a deficit has arisen on one or more of the insured’s client accounts; and

• (ii) informing the insured of the insured’s obligation to rectify such deficit(s); and

• (iii) setting out the regulatory consequences for the insured should such rectification not occur within a specified period of time;

“operative date” means 1 December 2020;

“participating insurer” means, in respect of an indemnity period,

• (i) an authorised insurer which has entered into and duly executed a participating insurers agreement with the Law Society on or before 1 November immediately prior to the commencement of that indemnity period and which is effective to permit such insurer to underwrite qualifying insurance; or

• (ii) an authorised insurer which has entered into and duly executed a participating insurers agreement with the Law Society in accordance with Regulation 17(e) and which is effective to permit such insurer to underwrite qualifying insurance;

“participating insurers agreement” means an agreement in such terms as the PII Committee may from time to time designate setting out the terms and conditions on which a participating insurer may provide qualifying insurance to firms in the State and the terms on which such participating insurer shall participate in the special purpose fund;

“personal insolvency practitioner” has the meaning ascribed to such term in the Personal Insolvency Act 2012 ;

“phoenix firm” means, in relation to any firm (a “predecessor firm”), a firm that is carrying on a practice that, in the absolute discretion of the PII Committee, is largely similar to or is a succeeding practice to the practice formerly carried on by a predecessor firm or any part thereof, and two (2) or more firms may be treated as each being phoenix firms to a single predecessor firm for the purpose of these Regulations;

“PII Committee” means the professional indemnity insurance committee constituted under Regulation 21;

“practice” means a business (which term includes any gainful occupation) or any part thereof consisting of the provision of legal services from an establishment in the State and where such legal services (as they involve the provision of legal advice) relate to the law of the State (including European Union law as it forms part of the law of the State);

“practice manager” means a person appointed by the Law Society to any firm in accordance with section 61 of the Solicitors Act 1954 [as substituted by Section 31 of the Solicitors (Amendment) Act 1994 ];

“practising certificate” has the meaning given in section 46 of the Solicitors Act 1954 ;

“preceding practice” means each practice:

• (i) which has ceased practice; and

• (ii) to which the firm’s practice is a succeeding practice;

“predecessor firm” is a firm in relation to which pursuant to these Regulations another firm is a phoenix firm;

“principal” means:-

• (i) the sole practitioner of any firm which during any indemnity period carries on or carried on business as a sole practitioner and includes a sole practitioner who employs or employed one (1) or more solicitors or registered lawyers; or

• (ii) every partner of a firm being a solicitor or registered lawyer and every person held out as a partner of a firm that during any indemnity period carries on or carried on business as a partnership; or

• (iii) a practice manager.

“qualifying certificate” has the meaning given in the European Communities (Lawyers’ Establishment) Regulations 2003 (Statutory Instrument No. 732 of 2003);

“qualifying insurance” means a policy or policies of insurance which (in the case of a single such policy) includes the relevant minimum terms and conditions or (in the case of a number of policies) taken together include the minimum terms and conditions in effect at the date of inception, extension, renewal or replacement of the policy or policies of insurance;

“re-calculated ARP premium” has the meaning ascribed to it in Regulation 12(f);

“registered lawyer” means a lawyer that has been granted a registration certificate by the Law Society and has been entered onto the register maintained by the Law Society within the meaning of and in accordance with the European Communities (Lawyers’ Establishment) Regulations 2003 (Statutory Instrument No. 732 of 2003) and a reference to a registered lawyer in these Regulations, where consistent with the context thereof, includes a former registered lawyer or a deceased registered lawyer;

“Registrar of Solicitors” means the holder of the office of Registrar of Solicitors appointed by the Law Society pursuant to section 8 of the Solicitors Act 1954 ;

“relevant person” has the meaning ascribed to it in the Commercial Property Regulations;

“relevant premium income” has the meaning ascribed to it in the Participating Insurers Agreement;

“residential property” has the meaning ascribed to it in the Commercial Property Regulations;

“residential property transaction” has the meaning ascribed to it in the Commercial Property Regulations;

“risk management audit” means an investigation of the practice of a firm that has been admitted to or that seeks to be admitted to the assigned risks pool, with a view to ascertaining the management and other conditions prevailing within the firm and the management and professional competence of the personnel employed by or engaged in the firm’s practice (including the principals of the firm);

“risk management auditor” means any person or persons (including any body corporate, partnership or unincorporated body) selected and appointed by the SPF management committee to conduct a risk management audit in accordance with these Regulations;

“risk management audit recommendations” means any recommendations made by a risk management auditor in a risk management audit report in relation to the future management of the practice of a firm;

“risk management audit report” means a report produced by a risk management auditor appointed to conduct a risk management audit into the practice of a firm, and detailing in particular (but without limitation) the following matters:-

• (i) the risk management auditor’s view as to the management and other conditions prevailing within the firm and the management and professional competence of the personnel employed by or engaged in the firm’s practice and of the principals of the firm; and

• (ii) providing such information in relation to the practice conducted by the firm as is necessary to ensure that the report responds to the matters required to be addressed by the risk management audit terms of reference; and

• (iii) giving the views of the risk management auditor as to the reasons why the firm was unable to obtain qualifying insurance; and

• (iv) making recommendations as to the steps that should be taken by the firm to enhance its prospects of being in a position to obtain qualifying insurance from a participating insurer outside the assigned risks pool in the future;

“risk management audit terms of reference” means the matters set out in Appendix 2 to these Regulations, as such matters as may be varied from time to time by the PII Committee;

“ROF” means the run-off fund;

“ROF coverage” means an arrangement for indemnification issued by the SPF manager to an ROF eligible firm on behalf of those participating insurers that participate in the special purpose fund and incorporating the minimum terms and conditions as varied by or pursuant to these Regulations;

“ROF eligibility criteria”, in relation to a firm, means a firm other than a legal partnership or a multi-disciplinary practice:-

• (i) which:

• (a) was carrying on a practice on the operative date and which established qualifying insurance with a participating insurer or more than one (1) participating insurer with effect from the operative date; or

• (b) commenced a practice subsequent to the operative date and which established qualifying insurance with a participating insurer or more than one (1) participating insurer with effect from the date it commenced practice; and

• (ii) held qualifying insurance with a participating insurer or more than one (1) participating insurer immediately prior to becoming a run-off firm; and

• (iii) was not a defaulting firm immediately prior to the operative date; and

• (iv) in respect of which there is no succeeding practice in accordance with the meaning of the term “succeeding practice” as it was defined in regulations made by the Law Society pursuant to section 26 of the Solicitors (Amendment) Act 1994 and which were in force on the date on which the firm ceased to carry on a practice;

• (v) Where the firm has been authorised as a limited liability partnership, each and every principal of the firm, prior to entry into the ROF irrevocably and unconditionally agrees, accepts and guarantees that, notwithstanding the firm’s status as a limited liability partnership, the principals of the firm shall be personally liable jointly and severally in respect of any liability arising under Regulation 9(f) and in respect of any liability that may arise against the principals of the firm under Clause 8 of the ROF Minimum Terms and Conditions.

“ROF eligible firm” means a firm other than a legal partnership or a multi-disciplinary practice that satisfies the ROF eligibility criteria;

“ROF premium schedule” means the schedule to be determined by the PII Committee and published by the Law Society from time to time which sets out the terms pursuant to which premium levels, in respect of firms other than legal partnerships or multi-disciplinary practices which are issued with coverage in the run-off fund, are to be determined by the SPF manager in accordance with these Regulations;

“ROF prior notice terms” means Regulation 9(g)(ii) and Regulation 9(g)(iv);

“ROF risk management audit” means an investigation of the practice of a firm that has been admitted to or that seeks to be admitted to the ROF, with a view to ascertaining the management and other conditions prevailing within the firm and the management and professional competence of the personnel employed by or engaged in the firm’s practice (including the principals of the firm);

“roll” has the meaning ascribed to it in the Solicitors Act 1954 ;

“run-off cover” means an arrangement for indemnification issued by the SPF manager on behalf of those participating insurers that participate in the special purpose fund for a firm other than a legal partnership or a multi-disciplinary practice that has ceased to carry on a practice which includes the relevant minimum terms and conditions as varied by or pursuant to these Regulations;

“run-off cover rules” means the model terms and conditions to be published by the PII Committee pursuant to Regulation 6(g);

“run-off firm” means a firm other than a legal partnership or a multi-disciplinary practice that:-

• (i) was carrying on a practice on the operative date or that subsequently commenced a practice; and

• (ii) has ceased to carry on a practice; and

• (iii) in respect of which there is no succeeding practice in accordance with the meaning of the term “succeeding practice” as it was defined in regulations made by the Law Society pursuant to section 26 of the Solicitors (Amendment) Act 1994 and which were in force on the date on which the firm ceased to carry on a practice;

“run-off fund” means the run-off fund established pursuant to Regulation 6(c);

“self-insured excess” means an amount that the Insured is required by the terms of any contract between the Insured and the Insurer to pay to the Claimant in the event of a Claim;

“solicitor” has the meaning given in section 3 of the Solicitors Act 1954 (as amended by section 3 of the Solicitors (Amendment) Act 1994 ) and a reference to a solicitor in these Regulations, where consistent with the context thereof, includes a former solicitor or a deceased solicitor;

“Solicitors Accounts Regulations” means the Solicitors Accounts Regulations 2014 ( S.I. No. 516 of 2014 ) or any statute or statutory instrument amending or replacing the Solicitors Accounts Regulations 2014 ( S.I. No. 516 of 2014 );

“SPF management committee” means the SPF management committee constituted under Regulation 22;

“SPF manager” means any person (including any body corporate, partnership or unincorporated body) from time to time appointed by the PII Committee to manage the special purpose fund, and includes any replacement to such a person appointed from time to time;

“special purpose fund” means the special purpose fund constituted under Regulation 6;

“succeeding practice” means a practice that satisfies any one (1) or more of the following conditions in relation to another practice (such other practice being a preceding practice for these purposes):-

• (i) it is held out as being a successor to the practice or part thereof of the preceding practice by whatever means such holding out occurs; or

• (ii) it is conducted by a partnership where two or more of the principals are identical to those persons who were principals of any partnership that conducted the preceding practice; or

• (iii) it is conducted by a sole practitioner who was the sole practitioner conducting the preceding practice; or

• (iv) it is conducted by a sole practitioner who was one of the principals conducting the preceding practice; or

• (v) it is conducted by a partnership in which the sole practitioner conducting the preceding practice is a partner and where no other person has been held out as a successor to the preceding practice; or

• (vi) the partnership which, or sole practitioner who, conducts the practice has assumed the liabilities of the preceding practice;

However, notwithstanding the foregoing, a practice shall not be treated as a succeeding practice for the purposes of the minimum terms and conditions pursuant to paragraphs (ii), (iii), (iv), (v) or (vi) of this definition if another practice is or was held out by that other practice as the succeeding practice.

“the 1995 Regulations” means The Solicitors Acts 1954 to 1994 (Professional Indemnity Insurance) Regulations 1995, as amended by the Professional Indemnity Insurance (Amendment) Regulations 1998, The Solicitors Acts 1954 to 1994 (Professional Indemnity Insurance) (Amendment) Regulations 1999, The Solicitors Acts 1954 to 1994 (Euro Changeover) Regulations 2001, The Solicitors Acts 1954 to 2002 (Professional Indemnity Insurance)(Amendment) Regulations 2004 and The Solicitors Acts 1954 to 2002 (Professional Indemnity Insurance)(Amendment) Regulations 2005;

“the 2007 Regulations” means The Solicitors Acts 1954 to 2002 (Professional Indemnity Insurance) Regulations 2007 (Statutory Instrument No. 617 of 2007) as amended by The Solicitors Acts 1954 to 2008 (Professional Indemnity Insurance) (Amendment) Regulations 2009 (Statutory Instrument No. 384 of 2009), The Solicitors Acts 1954 to 2008 (Professional Indemnity Insurance) (Amendment No. 2) Regulations 2009 (Statutory Instrument No. 441 of 2009) and The Solicitors Acts 1954 to 2008 (Professional Indemnity Insurance) (Amendment) Regulations 2010 (Statutory Instrument No. 495 of 2010);

“the 2011 Regulations” means The Solicitors Acts 1954 to 2008 (Professional Indemnity Insurance) Regulations 2011 (Statutory Instrument No. 409 of 2011) as amended by the Solicitors Acts 1954 to 2011 (Professional Indemnity Insurance) (Amendment) Regulations 2012 (Statutory Instrument No. 452 of 2012) and by the Solicitors Acts 1954 to 2011 (Professional Indemnity Insurance) (Amendment) Regulations 2013 (Statutory Instrument No. 433 of 2013);

“the 2014 Regulations” means The Solicitors Acts 1954 to 2011 (Professional Indemnity Insurance) Regulations 2014 (Statutory Instrument No. 445 of 2014) as amended by the Solicitors Acts 1954 to 2011 (Professional Indemnity Insurance) (Amendment) Regulations 2015 (Statutory Instrument No. 403 of 2015);

“the 2016 Regulations” means the Solicitors Acts 1954 to 2011 (Professional Indemnity Insurance) Regulations 2016 (Statutory Instrument No. 534 of 2016);

“the 2017 Regulations” means the Solicitors Acts 1954 to 2015 (Professional Indemnity Insurance) Regulations 2017 (Statutory Instrument No. 389/2017);

“the 2018 Regulations” means the Solicitors Professional Indemnity Insurance Regulations 2018 (Statutory Instrument No. 351/2018);

“the 2019 Regulations” means the Solicitors Professional Indemnity Insurance Regulations 2019 (Statutory Instrument No. 465/2019) and the Solicitors Professional Indemnity Insurance (Amendment) Regulations 2020 (Statutory Instrument No. 157/2020);

“working day” means every day, not including a Saturday, Sunday or public holiday, on which banks are generally open for the transaction of normal banking business in the State.

• (b) Other words and phrases in these Regulations shall have the meanings (if any) assigned to them by the Solicitors Acts 1954 to 2015 or the Legal Services Regulation Act 2015 .

• (c) The Interpretation Act 2005 shall apply for the purpose of interpreting these Regulations as it applies to the interpretation of an Act of the Oireachtas, except insofar as it may be inconsistent with the Solicitors Acts 1954 to 2015, the Legal Services Regulation Act 2015 or with these Regulations.

• (d) A reference in these Regulations to any, directive, statute, statutory provision, statutory instrument or other similar instrument includes:-

• (i) any subordinate legislation made under it; and

• (ii) any provision which it has superseded or re-enacted (with or without modification) or amended, and any provision superseding it or re-enacting it (with or without modification) or amending it either before, at or after the date of commencement of these Regulations.

3.

3. Firm:

• (a) Every firm must have a principal with a valid practising certificate or qualifying certificate in place in order to carry on a practice.

• (b) If a principal with a valid practising certificate or qualifying certificate is not in place, the firm must immediately cease practice until such time as a principal with a valid practising certificate or qualifying certificate is appointed.

4.

4. Maintenance of Insurance:

• (a) Every solicitor or registered lawyer that provides or wishes to provide legal services during an indemnity period shall not provide such legal services unless there is in place qualifying insurance with a qualifying insurer covering the provision of legal services by that solicitor or registered lawyer.

• (b) Every firm that carries on a practice during an indemnity period shall, subject to and in accordance with the remaining provisions of these Regulations, establish and maintain in place qualifying insurance with a participating insurer.

• (c) Where a firm is required by these Regulations to establish and maintain in place qualifying insurance during an indemnity period, no individual solicitor or registered lawyer employed by or engaged in the firm’s practice shall, during his or her period of employment or engagement with the firm, also be required to establish or maintain in place qualifying insurance in respect of that part of such individual’s practice as is carried on in the name of and for the account of the firm.

• (d) If qualifying insurance is not in place or ceases to be in place in respect of a solicitor, registered lawyer or a firm, that solicitor, registered lawyer or firm shall immediately cease practice until such time as insurance, as provided for in these Regulations, is in place.

• (e) Subject to Regulation 24, Regulation 4(a) shall not apply to or in respect of any solicitor or registered lawyer who provides legal services only as part of an employment within the State to provide legal services to and for his or her employer, provided that:-

• (i) the solicitor’s or registered lawyer’s employer is not a solicitor or registered lawyer; and

• (ii) the solicitor or registered lawyer confirms to the Law Society in a manner acceptable to it that, for the duration of a relevant indemnity period, the solicitor or registered lawyer has not and will not engage in the provision of legal services to or for any person other than his or her employer.

• (f) A solicitor or registered lawyer, who is exempted from Regulation 4(a) by virtue of Regulation 4(e), shall notify the Law Society immediately in writing if the exemption from Regulation 4(a) under Regulation 4(e) shall cease to apply in respect of the solicitor or registered lawyer.

• (g) A firm to which Regulation 4(b) applies shall be required to establish and maintain qualifying insurance in respect of any indemnity period (or part thereof) in which the firm carries on a practice, or as at and from the commencement by the firm of a practice, whichever is the earlier.

• (h) Each firm which submits a proposal form to a participating insurer(s) in respect of qualifying insurance (whether directly to the insurer or through a broker, agent or intermediary who is advising the firm on establishing and maintaining qualifying insurance) shall ensure that such proposal form does not contain any material misrepresentation or material non-disclosure (save for an innocent misrepresentation or innocent non-disclosure) on the part of the firm.

• (i) The PII Committee shall be entitled, in its discretion at any time and from time to time, for such period or periods as it considers fit and subject to such conditions as it may specify, to recognise a policy of insurance held by a firm (including, but not limited to, a firm at least one (1) of the principals of which is a registered lawyer) as being equivalent to qualifying insurance for all or some of the purposes of these Regulations. For the avoidance of doubt, the PII Committee shall be entitled to exercise its discretion under this Regulation 4(i) by prescribing categories of policies of insurance or other arrangements for coverage that shall be regarded as equivalent to qualifying insurance for all or some of the purposes of these Regulations.

• (j) The PII Committee shall have power to treat a firm as complying with any requirements of these Regulations notwithstanding that the firm has failed so to comply where such non-compliance is regarded by the PII Committee in a particular case or cases as being insignificant.

• (k) The PII Committee shall have power at such time or times and on such conditions as it thinks fit, to waive any provision or part of a provision of these Regulations in a particular case or cases, including by extending the time, either prospectively or retrospectively, for the doing of any act under any provision of these Regulations.

• (l) No firm shall be permitted to agree a coverage period with a participating insurer which is greater than 24 (twenty-four) months.

• (m) A firm shall provide to the Law Society such evidence that it has established and is maintaining qualifying insurance in accordance with these Regulations as the Law Society may from time to time require.

• (n) Without prejudice to the generality of Regulation 4(m), a firm shall be required to provide the Law Society, or procure that there is provided to the Law Society on its behalf, such confirmation and evidence, in any form designated by the Law Society, that it has established and is maintaining qualifying insurance within three (3) working days of the commencement of the coverage period to which the qualifying insurance relates.

• (o) Without prejudice to the generality of Regulation 20(a), every principal of a firm to which these Regulations apply shall be responsible for ensuring:-

• (i) that the firm has established and maintains in place qualifying insurance where required under these Regulations during any indemnity period (or part thereof) in which the firm carries on a practice; and

• (ii) that the firm provides in a timely manner any evidence that may be required under or pursuant to these Regulations that it has established and is maintaining qualifying insurance where required under these Regulations.

• (p) A phoenix firm shall not be in compliance with its requirement to establish and maintain qualifying insurance with a participating insurer pursuant to Regulation 4(b) unless its professional indemnity insurance cover includes cover in accordance with the minimum terms and conditions for claims made against any other firm in respect of which it is treated as a phoenix firm pursuant to Regulation 4(q).

• (q) The PII Committee may, in its absolute discretion at any time, decide to treat any firm as being a phoenix firm to another firm, or as not being a phoenix firm to another firm, in circumstances where the effect of treating the first-mentioned firm as a phoenix firm to the second-mentioned firm, or the effect of treating the first-mentioned firm as not being a phoenix firm to the second-mentioned firm, would be that the first-mentioned firm would not then be, or would then be, an ARP eligible firm or a run-off firm (as the respective case may be) and the PII Committee may, for the purposes of making any such decision, take into account such facts and matters as to it appear appropriate and relevant.

• (r) A solicitor or registered lawyer is deemed to be in compliance with the provisions of Regulation 4(a) where:-

• (i) The solicitor or registered lawyer has obtained cover pursuant to any policy or policies approved by the Law Society in accordance with section 23 of the 1960 Act; or,

• (ii) In the case of a registered lawyer, that registered lawyer has obtained cover pursuant to a policy of insurance that complies with the provisions of Regulation 6(2)(b) of the European Communities (Lawyers’ Establishment) Regulations 2003.

Notwithstanding any other provision in these Regulations, where a solicitor, registered lawyer or firm has obtained cover in compliance with paragraphs (i) and (ii) of this Regulation 4(r), the solicitor, registered lawyer and/or firm in question shall not be eligible for entry into the ROF or ARP in any circumstances and the SPF Manager shall be under no obligation to arrange for cover for any such solicitor, registered lawyer or firm in any circumstances.

5.

5. Self-Insured Excess on Qualifying Insurance:

• (a) A firm shall be permitted, in accordance with the minimum terms and conditions, to agree with its participating insurer a self-insured excess in respect of its qualifying insurance, to be borne by the firm in the event of a claim, provided that the participating insurer has agreed that, in any case where the firm defaults in making payment of any part of such self-insured excess to a claimant when lawfully due, the participating insurer will pay the outstanding amount directly to the claimant.

• (b) Every firm shall be required to make prompt payment to a claimant, in the event of a claim being upheld against it, of the amount of any self-insured excess provided for under a qualifying insurance when the same is lawfully due to the claimant.

• (c) Without prejudice to the generality of Regulation 20(a), every principal of a firm to which these Regulations apply shall be responsible for ensuring that the firm makes prompt payment of any self-insured excess under its qualifying insurance as required by these Regulations.

6.

6. Establishment of Special Purpose Fund:

• (a) On the operative date, there shall be and is hereby established by these Regulations a fund to be known as the “special purpose fund” to fulfil the functions assigned to it by these Regulations.

• (b) From the operative date, the assigned risks pool shall form a constituent part of the special purpose fund.

• (c) On the operative date there shall be and is hereby established by these Regulations a fund to be known as the run-off fund. The run-off fund shall form a constituent part of the special purpose fund and shall fulfil the functions assigned to it by these Regulations.

• (d) In each indemnity period, the special purpose fund shall be participated in by each insurer which is a participating insurer in that indemnity period.

7.

7. Maintenance of Insurance in Run-off:

• (a) Every run-off firm shall be required to establish and maintain run-off cover from the expiry of the coverage period during which its practice ceases.

• (b) The run-off cover required to be obtained by a run-off firm pursuant to Regulation 7(a) shall be as follows:-

• (i) for a run-off firm that is an ROF eligible firm, ROF coverage.

• (ii) for a run-off firm that is an ARP run-off eligible firm, ARP run-off cover.

• (c) No premium shall be payable by an ROF eligible firm or an ARP run-off eligible firm for run-off cover from the run-off fund, unless:-

• (i) Such firm is a distressed firm within the meaning of these Regulations, in which case, Regulation 7(d) shall apply; or

• (ii) Such firm is a non-compliant run-off firm for the purposes of Regulation 10.

• (d) A distressed firm shall pay in advance of entry to the ROF such sum by way of an advance payment of premium to be known as the “distressed firm premium” as the SPF manager may determine in accordance with the ROF premium schedule.

• (e) The run-off cover provided by the run-off fund established by these Regulations shall commence from the expiry of the coverage period during which that firm’s practice ceases and shall continue for a duration of six years from the date of commencement of the run-off cover, such cover to be provided on the basis of the minimum terms and conditions as varied by or pursuant to these Regulations.

• (f) For the avoidance of doubt, where run-off cover is extended to an ROF eligible firm or to an ARP run-off eligible firm by the run-off fund, that firm shall be deemed to have “established” run-off cover for the purposes of the definition of defaulting run-off firm and any other relevant definitions or provisions that require a firm to “establish and maintain” run-off cover.

• (g) Run-off cover is not subject to cancellation on any basis whatsoever, save that it may be cancelled on terms to be agreed between the SPF manager and the firm where the following conditions are met:-

• (i) the firm has obtained replacement qualifying insurance in accordance with the minimum terms and conditions on the date of cancellation of the relevant run-off cover; and

• (ii) the participating insurer or participating insurers under the replacement qualifying insurance referred to in Regulation 7(g)(i) have confirmed in writing to the firm and to the SPF manager that they are providing qualifying insurance on the basis that the firm’s practice is to be treated as a continuation of the firm’s practice prior to the cessation thereof and that accordingly they will be liable for any claims against the firm arising from matters that occurred prior to the cessation; and

• (iii) the participating insurer or participating insurers under the replacement qualifying insurance referred to in Regulation 7(g)(i) have provided any required confirmations of coverage to the Law Society pursuant to these Regulations.

• (h) The PII Committee may from time to time, prior to the beginning of an indemnity period, publish model terms and conditions to apply to run-off cover, which shall when published constitute the minimum terms and conditions applicable to such cover.

• (i) A legal partnership and a multi-disciplinary practice shall not be eligible for entry into the ROF.

• (j) A legal partnership and a multi-disciplinary practice shall be required to establish and maintain run-off cover, as defined in regulations made by the Legal Services Regulatory Authority in accordance with Section 47 of the Legal Services Regulation Act 2015 , from the expiry of the coverage period in which the practice ceases in accordance with regulations made by the Legal Services Regulatory Authority under Section 47 of the Legal Services Regulation Act 2015 .

8.

8. Defaulting Run-off Cover:

• (a) The SPF manager shall make arrangements to ensure that a defaulting run-off firm is covered through the run-off fund in respect of any period during which such a firm does not hold run-off cover in accordance with its obligations under Regulation 7 and such arrangements shall procure that a defaulting run-off firm in respect of which the arrangements apply is covered in respect of all claims and circumstances where coverage would extend to a defaulting firm through the assigned risks pool. Any arrangements made by the SPF manager pursuant to this Regulation 8(a) in respect of defaulting run-off firms shall not be regarded as run-off cover for the purposes of satisfying Regulation 7(a).

• (b) No premium shall be payable by a defaulting run-off firm for arrangements made under Regulation 8(a), unless such firm is a distressed firm within the meaning of these Regulations, in which case, a distressed firm shall pay in advance such sum by way of an advance payment of premium to be known as the “distressed firm premium” as the SPF manager may determine in accordance with the ROF premium schedule.

• (c) The SPF manager, on behalf of participating insurers, shall be entitled to recover from each and every principal in a defaulting run-off firm all amounts paid in or towards the discharge of a claim and defence costs pursuant to arrangements made under Regulation 8(a) together with interest thereon at two percent (2%) over the base lending rate of the European Central Bank from time to time.

• (d) A defaulting run-off firm which was authorised as a limited liability partnership immediately prior to its failure to obtain or maintain run-off cover in accordance with these Regulations cannot maintain limited liability partnership status as the firm’s authorisation as a limited liability partnership shall stand revoked by virtue of Section 129(3) of the Legal Services Regulation Act 2015 due to the failure of the firm to obtain or maintain run-off cover in accordance with these Regulations.

• (e) Any arrangements made by the SPF Manager under Regulation 8(a) are subject to Regulation 8(d) and the condition that the defaulting run-off firm does not make an application for authorisation as a limited liability partnership under Section 125 of the Legal Services Regulation Act 2015 for the duration of the said arrangements.

9.

9. Entering the Run-off Fund:

• (a) A firm other than a legal partnership or a multi-disciplinary practice which intends to cease practice:

• (i) Shall provide the SPF manager with a written notice of its intention to cease practice at least 60 (sixty) days, or such other period as the PII Committee may from time to time determine, prior to ceasing practice and at least 60 (sixty) days, or such other period as the PII Committee may from time to time determine, prior to the expiry of its coverage period, whichever is the earlier. The firm shall include its most recent completed proposal form with such notice; and

• (ii) Shall be required to submit to and co-operate with an ROF risk management audit prior to entry to the ROF to be conducted by a risk management auditor selected and appointed by the SPF management committee on such terms, at such times and at such intervals as the SPF management committee may in its absolute discretion determine. The SPF Manager may waive the obligation to submit to and co-operate with an ROF risk management audit if the SPF Manager is satisfied that it is appropriate to do so in the prevailing circumstances.

• (b) A firm which provides the SPF manager with written notice of its intention to cease practice pursuant to Regulation 9(a) shall cease practice on the date specified in such notice unless otherwise previously agreed in writing with the Law Society.

• (c) The SPF manager shall procure that:-

• (i) in respect of an ROF eligible firm, ROF coverage shall be issued to the firm with effect from the date of expiry of the coverage period in which its practice ceases; and

• (ii) in respect of an ARP run-off eligible firm, ARP run-off cover shall be issued to that firm with effect from the date of expiry of its coverage period.

• (d) Every firm that holds run-off cover through the run-off fund, or in respect of which arrangements are made under Regulation 8(a), shall notify any claim or circumstance required to be reported or notified to the SPF manager pursuant to its run-off cover or arrangements within any time prescribed therefor under such run-off cover or arrangements.

• (e) ROF coverage issued to an ROF eligible firm shall have a self-insured excess equal to the self-insured excess applicable to the qualifying insurance held by that firm at the time it ceased practice. ARP run-off cover issued to an ARP run-off eligible firm shall have a self-insured excess equal to the self-insured excess applicable to ARP coverage.

• (f) Subject to Regulation 9(h), the SPF manager may pay any amount that is within the self-insured excess of any firm’s run-off cover to a claimant but shall be entitled to recover any amount so paid from the following:-

• (i) the principal(s) of the firm at the date that the firm entered the ROF; or

• (ii) Where one or more of the principal(s) of the firm at the date the firm entered the ROF are deceased, the estate of any such deceased principal(s),

but the SPF Manager shall not be entitled to recover any amount so paid from a practice manager that stands appointed to a firm at the date that the firm entered the ROF.

• (g) Where a run-off firm fails to:-

• (i) comply with the close of practice guidelines; or

• (ii) notify the SPF manager of its intention to cease practice in accordance with Regulation 9(a); or

• (iii) cease practice on the date specified in the written notice of its intention to cease practice provided by the firm to the SPF manager; or

• (iv) send its most recently completed proposal form to the SPF manager in accordance with Regulation 9(a); or

• (v) comply with the minimum common risk management standard; or

• (vi) fully co-operate with the SPF manager in the conduct of claims; or

• (vii) notify any claim or circumstance required to be notified to the SPF manager pursuant to Regulation 9(d) within a reasonable period of time; or

• (viii) comply with the ROF risk management audit under Regulation 9(a)(ii);

an additional self-insured excess shall apply to that firm’s run-off cover as determined by the SPF manager in accordance with the run-off cover rules.

• (h) The SPF manager shall not be obliged to pay any amount which is within the additional self-insured excess (as determined by the SPF manager in accordance with Regulation 9(g)) in respect of a claim made by a financial institution.

• (i) Every run-off firm that is issued with run-off cover by the run-off fund, or in respect of which arrangements are made under Regulation 8(a), shall provide to the SPF manager such information as the SPF manager may from time to time in its discretion reasonably require to deal efficiently and effectively with that firm’s membership of the run-off fund.

10.

10. Compliant and Non-Compliant Run-off Firms

• (a) With effect from 1 December 2017 and on 1 December of each year thereafter, each run-off firm shall be designated as either a compliant run-off firm or a non-compliant run-off firm by the SPF manager in accordance with the following:

• (i) in relation to a run-off firm which ceased to practice on or after 1 December 2012 and on or before 30 November 2016,

• (a) a run-off firm shall be designated as a compliant run-off firm by the SPF manager, if, in the opinion of the SPF manager, such firm has cooperated with the SPF manager in a manner which has allowed the SPF manager to deal efficiently and effectively with the firm’s membership of the run-off fund and any claims made against the firm;

• (b) a run-off firm shall be designated as a non-compliant run-off firm by the SPF manager, if, in the opinion of the SPF manager, such firm has not cooperated with the SPF manager in a manner which has allowed the SPF manager to deal efficiently and effectively with the firm’s membership of the run-off fund or any claims made against the firm;

• (ii) in relation to a run-off firm which ceased to practice on or after 1 December 2016,

• (a) a run-off firm shall be designated as a compliant run-off firm by the SPF manager with effect from the date the firm is first provided with ROF cover, if, in the opinion of the SPF manager, the firm has complied with the compliant run-off firm eligibility criteria;

• (b) a run-off firm shall be designated as a non-compliant run-off firm by the SPF manager with effect from the date the firm is first provided with ROF cover, if, in the opinion of the SPF manager, the firm has not complied with the compliant run-off firm eligibility criteria;

• (b) A run-off firm which is designated as a non-compliant run-off firm by the SPF manager pursuant to Regulation 10(a), may be re-designated as a compliant run-off firm by the SPF manager at any time during the course of the relevant indemnity period, if, in the opinion of the SPF manager, such firm has cooperated with the SPF manager in a manner which has allowed the SPF manager to deal efficiently and effectively with the firm’s membership of the run-off fund and any claims made against the firm.

• (c) A run-off firm which is designated as a compliant run-off firm by the SPF manager pursuant to Regulation 10(a), may be re-designated as a non-compliant run-off firm by the SPF manager at any time during the course of the relevant indemnity period, if, in the opinion of the SPF manager, such firm has not cooperated with the SPF manager in a manner which has allowed the SPF manager to deal efficiently and effectively with the firm’s membership of the run-off fund or any claims made against the firm.

• (d) A run-off firm which has been designated as a non-compliant run-off firm by the SPF manager may appeal its designation as a non-compliant run-off firm to the SPF management committee. This appeal shall be dealt with by the SPF management committee in accordance with the applicable appeal procedures published by the SPF management committee from time to time. The SPF manager shall be recused from and shall not participate in any business or activity of the SPF management committee in respect of an appeal brought before it by a non-compliant run-off firm pursuant to this Regulation 10(d). An appeal of the decision of the SPF management committee shall be subject to arbitration in accordance with Regulation 11.

• (e) With effect from 1 December 2017, ROF coverage shall not extend to a non-compliant run-off firm in respect of any claim made against that run-off firm by a financial institution.

• (f) A run-off firm which has been designated a non-compliant run-off firm by the SPF manager shall pay such sum by way of a payment of premium, to be known as the “non-compliant firm premium”, as the SPF manager may determine in accordance with the ROF premium schedule.

11.

11. Arbitration

• (a) Any dispute or claim arising out of or in connection with Regulation 10(d) shall be referred, by written notice from either party, to the decision of a single arbitrator, as may be nominated by agreement between the parties to the arbitration, or failing such agreement within 21 (twenty one) days of a written notification being made by one (1) of the parties to the arbitration, by an arbitrator appointed by the Chairperson for the time being of the Chartered Institute of Arbitrators (Irish Branch) or in the event of his being unwilling or unable to do so, by the next senior officer at the Chartered Institute of Arbitrators (Irish Branch) who is willing and able to make the appointment.