Succeeding Practice Rule

Head of Practice Regulation 30/09/2025

The purpose of this practice note is to provide guidance to the profession on the succeeding practice rule for the 2024/2025 indemnity period. This information is intended as general guidance and does not constitute a definitive statement of law. 

Ceasing firms

Where a firm ceases practice, valid professional indemnity insurance (PII) claims made against the firm are covered in one of two ways:

  1. If the ceased firm has a succeeding practice or succeeding practices, the insurance of any succeeding practice(s) covers such claims,
  2. If the ceased firm does not have a succeeding practice or succeeding practices, the firm enters the Run-Off Fund. The coverage provided under the Run-Off Fund covers such claims.

Whether or not a firm is a preceding practice or a succeeding practice in relation to any other firm will depend on a detailed analysis, taking account of the facts of the particular case. No generalised practice guidance can be given, and each case must be individually examined with reference to the definitions of preceding and succeeding practice as set out in the regulations.

Definitions

‘Preceding practice’ means a practice that has ceased practice and to which the firm’s practice is a succeeding practice.

‘Succeeding practice’ means a practice that satisfies any one or more of the following conditions in relation to another practice (with such other practice being a preceding practice for these purposes):

Succeeding practice rule is found in the current PII Regulations - Solicitors Professional Indemnity Insurance (Amendment) Regulations 2022 (S.I. No. 585 of 2022) as follows, 

and a firm automatically becomes a succeeding practice if any of conditions of the definition apply:

(a) 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

(b) 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

(c) it is conducted by a sole practitioner who was the sole practitioner conducting the Preceding Practice; or

(d) it is conducted by a sole practitioner who was one of the principals conducting the Preceding Practice; or

(e) 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

(f) the Partnership which, or sole practitioner who, conducts the practice has assumed the liabilities of the Preceding Practice.

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 (b), (c), (d), (e) or (f) of this definition if another practice is or was held out by that other practice as the Succeeding Practice.

Multiple succeeding practices

Depending on the precise circumstances, more than one firm can be a succeeding practice to a preceding practice, and a number of factors may need to be taken into account to identify the succeeding practices that meet the definition in the regulations.

For example, the definition of a succeeding practice includes a practice that is held out as being a successor to the preceding practice or any part thereof. In this context, the ‘part’ of the practice that the succeeding practice is being held out as a successor to may mean a recognisable part of the practice, such as all the conveyancing or litigation or probate files, or all of the residential conveyancing or personal injury or debt collection or family law files, or all the files of a branch office, depending on the context and structure of the practice. However, this is not an exhaustive list. Therefore, the preceding practice could be broken into a number of succeeding practices holding themselves out as a successor to specific parts of the preceding practice.

It should be noted that a firm may take on the files of a preceding practice without being deemed to be a succeeding practice so long as they do not meet any of the conditions in the definition of a succeeding practice, including holding themselves out as a successor to all or part of the preceding practice.

Determination of whether a firm is a succeeding practice

It is clear from the definition of a succeeding practice that determination of whether a firm is or will be deemed to be a succeeding practice depends on the particular circumstances in question. While the Society will seek to assist firms in relation to the general definition of preceding and succeeding practices, the Society will not, and cannot, provide any advice, declaration or ruling as to whether a firm would be considered to be a succeeding practice. The Society considers that it is best practice for the relevant firm to liaise with its broker and/or insurer with a view to ascertaining its views on whether the firm would be considered to be a succeeding practice and to discuss generally the impact on its PII.

How to avoid being held out as a succeeding practice

A firm is NOT a succeeding practice if any of the following apply

  • None of the conditions in the definition of succeeding practice apply
  • Another practice is or was held out as a succeeding practice
  • A sole principal retires and passes their files to another firm that does not hold itself out as a succeeding practice

To avoid being deemed a succeeding practice, if you are only taking on the files of a closed practice, ensure the following:

  1. Stationery - Do not include any reference to the ceased practice on any of your firm’s business stationery including notepaper, business cards, or invoices. This also includes your website and social media
  2. Advertising - Do not advertise the fact that your firm has taken on the business of a ceased practice
  3. Continuation - Do not lead clients of the ceased firm to believe that your firm is a continuation of the ceased firm.
  4. Promotion - Despite being desirable in business development terms, do not use the name of the ceased practice for promotional or any other purpose
  5. Notification - Send a formal written notification to the Law Society that your firm is not a succeeding practice to the ceased firm.

When you write out to the clients of the ceased firm, you should ensure the correspondence follows these guidelines:

  1. Make a clear distinction between your firm and the ceased firm
  2. Make it clear that your firm is a separate practice – it is not a continuation of the ceased firm
  3. Inform the clients that your firm has reached an agreement to take on the files of the ceased firm in order to offer a continuity of services to its clients to ensure that there is no disruption in the handling of their legal affairs
  4. Remember that the files belong to the client – give them the option to nominate your firm as their new solicitor, to have the file sent on to another nominated solicitor, or to have the file returned to the client

Phoenix firm and anti-abuse provisions

Phoenix firm provisions are in place to prevent abuse of the ROF by firms closing to dump their claims into the ROF and then reopening in another form. It should be noted that the phoenix firm provisions apply regardless of how much time passes since the ceased firm entered the ROF. If a firm is deemed to be a phoenix firm, the Society can prevent the new firm from opening or prevent the principal of a run-off firm from joining another firm as a partner/principal until succeeding practice cover is in place.  Principals of run-off firms can join other firms as consultants or assistant solicitors without triggering the phoenix firm provisions, so long as the firm they have joined does not trigger the succeeding practice rule. Designation as phoenix firm is at the absolute discretion of the PII Committee

A firm may be a phoenix firm if any of the following apply:

  1. The new firm meets the definition of succeeding practice.
  2. The firm they have joined triggers the succeeding practice rule.
  3. New firm is largely similar to or has succeeded the ceased practice.
  4. Two or more firms can be treated each as being a phoenix firm.

The ceasing firm entering the ROF is required to sign a declaration stating that the principal(s) have no intention in forming a succeeding practice at any time in the future, and confirming that all claims and circumstances have been notified to their existing insurers up to the expiry of the firm’s insurance

A “phoenix capture” system is run by the Society to identify any phoenix firm that attempts to open in practice and such firms will be designated as phoenix firms by the PII Committee

Phoenix firms are required to declare and cover the new firm as a succeeding practice to the ceased firm in order to be permitted to commence in practice. Such insurance should cover all claims against the ceased firm since the date of cessation. Insurers will have a right of reimbursement for claims already paid by the ROF for the ceased firm. Phoenix firms that do not obtain the required succeeding practice insurance will not be allowed to practice.

For more information contact: piihelpline@lawsociety.ie