Regulated Vs Unregulated Switch Approving Laws Rules Guidelines

By Trevor Hellawell 


As part of the Law Society’s response to the SRA’s consultation on the future direction of travel for their Codes of Conduct and Accounts Rules, the Society make much of the suggestion that, in future, firms can choose whether or not to be SRA-regulated at all. They question many of the SRA’s assumptions.


Part of this suggestion is the SRA assertion that there is a significant unmet legal need in the market and that the general public should be able to access legal services at a cheaper cost. This, they say, is to be achieved by allowing solicitors to act as such through the medium of an unregulated provider, which will have none of the costs of regulation to bear, and nor will it have all the burdensome PII premiums and complaints machinery that engaging a solicitor brings with it.


The SRA say that such a body could pass those cost savings on to the customer and offer unreserved and unregulated legal services to the general public at a much lower cost. The Consumer Panel of the Legal Services Board will no doubt welcome this pressure to lower costs, as it continues with its pressure to publish average costs as a banner of consumer choice.


The SRA also trumpet protection of the consumer as another of its aims. I wonder whether these two aims are inconsistent.


I am all for reducing unnecessary costs, and the profligacy of some, but I wonder whether the aim for ever-lower costs will ultimately work against the interests of clients.


Take conveyancing fees for instance. Most firms who offer quotes set out to compete with everyone else and thus reduce the per-matter fee to something around £400-500 per transaction. Bear in mind what that will buy you – a reasonable armchair, perhaps, or two-thirds of a laptop for the new school term, or one-tenth of the last service bill for my car. What are you getting for that?


What you should be getting is the focused attention of a legally-qualified fee-earner on all aspects of the transaction – obtaining and interpreting searches, investigating title to your property, drafting the key documentation, advising on Stamp Duty issues, affecting exchange and completion and attending to registration – and liaising over all the transactional infrastructure of completion, moving etc.


Clients will expect all this, and the possibility of complaint, redress, secrecy, confidentiality, insurance, overarching supervision and the ability to sue the lawyers if they send their money to the wrong place through no fault of theirs – and all for £400?


Many law firms have been bemoaning the state of the conveyancing fee market for some time but without doing much about it. Is it time for us to set our charges at a more realistic level? We all know that ‘factory firms’ will offer a service but with none of the bells and whistles that clients demand these days. The SRA say that as lawyers we must make it clear to the (uninterested) client what their protections are – but how many will roll their eyes heavenward when they realise – too late – that their chosen conveyancer only did half a job for the cut-price they were quoted?


Maybe, as a regulated profession, we are not cheap. But there is a good reason for that.


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