241.Paragraphs 6 to 8 adjust section 43 of the 1980 Act which deals with the Guarantee Fund. The primary change here is to make the regulatory committee of the Law Society responsible for the management and control of the Fund. The Guarantee Fund has also been renamed the “Client Protection Fund”.
242.The changes in paragraph 6(2) and (3) are consequential on the provisions made in section 4(4). These enable the Fund to be used for the purpose of providing loans to judicial factors and limiting the claims that an applicant can make in relation to a particular act of dishonesty.
243.Paragraph 6(6) inserts a new section into the 1980 Act to enable the Scottish Ministers to adjust section 43 and schedule 3 of the 1980 Act in respect of the circumstances when claims can be made, the maximum amount of any grant payable and in connection with administrative matters. This power can only be exercised at the request of the Lord President, the regulatory committee or the independent advisory panel of the Commission. Before making a request, the person or body must consult the regulatory committee, the independent advisory panel and any other appropriate persons or bodies. The requestor must also secure the Lord President’s agreement. A request must include a document setting out an explanation of the change sought through the request and the reasons for making the request, along with copies of any written representations received during the consultation period. In addition, there is placed on the person or body making the request a requirement to publish those documents.
244.This new section 43A is not wholly consequential on the Law Society becoming a category 1 regulator. While it may be used to adjust the provisions governing the Fund for that purpose, it may also be used for making other changes. It is included in this Part of the schedules as it sits naturally with the other changes being made to section 43.
Schedule 1 – Law Society of Scotland Client Protection Fund