PLC Paper No. CB(2) 1313

Ref: CB2/BC/10/97

Paper for the House Committee Meeting
on 27 March 1998

Report of the Bills Committee on
Legal Practitioners (Amendment) Bill 1998

Purpose

This paper reports on the deliberations of the Bills Committee on the Legal Practitioners (Amendment) Bill 1998

Background

2. Before 1 July 1997, the appointment of notaries public was made by the Archbishop of Canterbury. This system of appointment has since lapsed and it has not been possible to appoint new notaries public in Hong Kong. It is therefore necessary to provide a new legislative framework to establish a system of locally-appointed notaries.

3. The Legal Practitioners (Amendment) Bill 1996 (the 1996 Bill) was introduced into the Legislative Council in February 1996 to localise the appointment of notaries public. It was withdrawn by the Administration after the passage of a Committee stage amendment proposed by the Bills Committee providing for compulsory membership of notaries public with the Hong Kong Society of Notaries (HKSN).

The Bill

4. The purpose of the Bill is to provide for the appointment in Hong Kong of notaries public.

The Bills Committee

5. At the House Committee meeting held on 13 February 1998, Members agreed to form a Bills Committee to study the Bill. The Bills Committee first met on 24 February 1998 and Hon Mrs Miriam LAU was elected Chairman. The membership list of the Bills Committee is at Appendix I.

6. The Bills Committee held two meetings with the Administration and met representatives of the HKSN at the second meeting.

Deliberations of the Bills Committee

7. The main deliberations of the Bills Committee are set out in the following paragraphs.

Compulsory membership and regulatory role of the HKSN

8. The Bill provides for compulsory membership of the HKSN for practising notaries. This requirement is supported by members of the Bills Committee. However, as the Administration previously considered that such prerequisite requirement would probably infringe the right of freedom of association under Article 22 of the International Covenant on Civil and Political Rights (ICCPR) and would be open to challenge in courts, members have asked the Administration to explain the reason for the change in policy. The Administration explains that in withdrawing the 1996 Bill, the Administration was concerned that if the law required notaries public to be members of the HKSN but did not give the HKSN a regulatory role in respect of its members, such compulsory membership would probably infringe the right to freedom of association under Article 22 of the ICCPR. To address this human rights concern, the Administration has included in the current Bill provisions on the regulatory role of the HKSN in relation to the practice, conduct and discipline of notaries public. With the regulatory framework as set out in new sections 40F to 40R, the requirement of compulsory membership of the HKSN would be compatible with Article 22 of the ICCPR.

The Administration’s policy on membership of professional bodies

9. One member has asked the Administration to clarify its policy on membership of professional bodies and in particular, to explain why in comparison, practising medical specialists are not required to be members of the Hong Kong Academy of Medicine (HKAM). In response, the Administration has pointed out that the HKAM and the HKSN have different functions. The HKAM is essentially a professional training body and it offers one of the two routes by which doctors undergoing postgraduate training may be recognised as specialists. Its membership is necessary for a doctor who wishes to undergo training organized by the HKAM, following which he will be recognised as a Fellow of the HKAM and be recommended to the Medical Council to be accredited with the title "Specialist". The HKAM is therefore not a regulatory or registration body - that power lies with the Medical Council. On the other hand, the Bill empowers the HKSN to issue, suspend or cancel a notary public’s practising certificate. In addition, the Council of the HKSN is empowered to make rules regarding the professional practice, conduct and discipline of notaries public. In this regard, the HKSN has similar regulatory power as the two other legal professional bodies, i.e. the Law Society of Hong Kong and the Hong Kong Bar Association.

Qualifications for appointment

10. Members are concerned that under the proposed new section 40A(1)(a), non-practising solicitors such as in-house lawyers who do not hold practising certificates but have been on the roll of solicitors continuously for seven years immediately before the date of their application for appointment could be eligible for appointment as notaries public. In order to maintain the status quo, members have asked the Administration to amend the section to stipulate the requirement for seven years’ practice. In response to members’ proposal and after consulting the HKSN, the Administration has suggested amendments to the appointment criteria under the proposed section 40A(1) so that it is no less stringent than the appointment/admission criteria of notaries prior to 1 July 1997.

11. The draft amendments provide that, in addition to the requirement that the applicant has been on the roll of solicitors continuously for the whole period of seven years prior to his application for appointment as a notary, the applicant must have practised as a solicitor in Hong Kong for an aggregate period of at least seven years before his application.

Powers of Council of Society of Notaries to make rules

12. The proposed new section 73D empowers the Council of the HKSN to make rules relating to the practice, conduct and discipline of notaries public and their employees. In response to members’ request, the Administration has provided information on codes of practice or practice directions in other common law jurisdictions for members’ reference. Members note that the HKSN is satisfied with the provisions and that every rule made by the Council of the HKSN under the proposed new section 73D shall be subject to the prior approval of the Chief Justice.

Indemnity rules for notaries public

13. The new section 73E empowers the Council of the HKSN to make rules concerning indemnity against loss arising from claims in respect of civil liability incurred in connection with a notary public’s practice. Members note that the requirement for indemnity rules is proposed with the aim of protecting the interests of clients of notaries public in general and that the provisions offer a number of alternatives for the HKSN to consider and adopt.

14. In response to the concern expressed by some members about the possible high cost in providing for indemnity, the HKSN has informed the Bills Committee that it plans to provide for indemnity jointly with the Law Society. This will be done by amending the definition of practice in the indemnity rules of the Law Society to include notaries public. As insurance premium for professional indemnity is calculated as a percentage of the gross fee income of the legal practices concerned, the premium for the share of fee income from notarial work could be assessed and paid on the same basis. In this connection, members note that notaries public have been de facto covered in the past. The HKSN has also pointed out that as there has been neither claim in respect of notaries public nor complaint about the conduct of any notary in the past, the HKSN is confident that the proposed arrangement will be accepted by insurers.

Committee Stage Amendments (CSAs)

15. In addition to the CSAs outlined in paragraph 11 above, the Administration will move a number of minor technical amendments. The draft CSAs to be moved by the Administration are at Appendix II.

Recommendation

16. The Bills Committee recommends the resumption of the Second Reading debate on the Bill on 7 April 1998.

Advice Sought

17. Members are invited to support the recommendation of the Bills Committee in paragraph 16 above.

Provisional Legislative Council Secretariat
25 March 1998

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Appendix I

Bills Committee on Legal Practitioners (Amendment) Bill 1998

Provisional Legislative Council Secretariat
5 March 1998