MINISTER FOR Justice Alan Shatter has told the Law Society to make it clear to its members that he is not taking sides in a vote on a bailout of a private mutual fund that provides professional indemnity for solicitors.
Members of the society are balloting on a proposal to charge each solicitor €200 a year over 10 years, which the society says is required to fund an “orderly wind-down” of the Solicitors Mutual Defence Fund (SMDF).
The society appointed one solicitor to write a 500-word paper in favour of the proposal and another to write a paper arguing against.
The paper arguing the case for the bailout stated: “The Minister for Justice has backed the proposal as being in the public interest, which it clearly is.”
Law Society president John Costello e-mailed members on Tuesday to issue a “clarification” after the society was contacted by the Minister.
“The Minister has reiterated to the society that he believes it to be in the public interest that the described difficulties being experienced by the SMDF be resolved by the solicitors’ profession,” Mr Costello wrote. “However, he has asked the society to make it clear that he is expressing neither support nor opposition to the proposal on which its members are currently voting.”
There has been extensive lobbying of members of the profession from both sides, with eight members of the society’s own council writing to them outside the ballot process to seek a Yes vote. The society has rejected any suggestion that the 17 members of the council who are also members of the fund have any conflict of interest. Some 78 per cent of solicitors’ firms are insured with private insurers, while 22 per cent are with the fund.
The fund claims insolvency and the society estimates its liabilities at €170 million. However, solicitor Vincent Crowley, who wrote the argument against the bailout, said the society’s own adviser, Deloitte, estimates the fund’s liabilities to be about €308 million.
He wrote to solicitors last week expressing disappointment that eight members of the society’s council had separately contacted solicitors urging a Yes vote.