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Wednesday, 28 September 2016

SRA - one rule for you and one rule for me

There are increasingly heated discussions about how and where Solicitors can offer legal services to the public. To most people this seems fairly obvious. You go and see a Solicitor. But in a rapidly changing world this is could become the exception rather than the rule.

Under the present regulations a Solicitor can only provide legal services to the public via an organisation regulated by the SRA or other approved regulator. Some legal work is ‘reserved’ and some is ‘unreserved’. Reserved work can only be carried out by an authorised person such as a Solicitor. This is a surprisingly limited category of work and includes the power to conduct litigation, to appear before certain courts and the drawing up of certain documents. Almost all other legal work is unreserved which means it can be provided by anybody. So you don’t have to be a Solicitor to set up a business offering advice in say, employment law or welfare benefits. But if you are a solicitor you have to operate through a regulated body – such as a solicitors’ firm. The reason for this is that there are standards and protections that go with the solicitor brand. For example all solicitors’ firms have to carry professional indemnity insurance.  They also have to contribute to a compensation fund.

So if a client instructs a solicitor they know that if anything goes wrong there are levels in protection in place. If solicitor is negligent then the insurers have to meet any claim. If the solicitor is guilty of misconduct, including failing to take out insurance, then the compensation fund is a safety net. This has been a foundation stone of our legal services.

The SRA are planning to change all this.

In a consultation that has recently closed they plan to have two separate sets of professional rules. One will cover individual solicitors and one will cover regulated firms. The proposal is that solicitors will be allowed to provide ‘unreserved’ services through unregulated organisations. So someone can set up an HR Consultancy and will be able to employ solicitors to offer legal advice to the public even though that consultancy is not regulated. The thinking behind the plans is that solicitors are a commercial disadvantage. The cost of regulation means that some organisations can provide the same advice at much lower cost. Insurance is one of the biggest overheads in most forms.

I think this is a recipe for disaster. Firstly, it threatens to devalue the solicitor brand. If someone can see a solicitor in an unregulated firm with no insurance or other regulatory protection then the security of knowing that there are guaranteed protections will disappear. This is not something that can be defined purely by cost. 

I can also see dangers, particularly for young lawyers. The SRA say that solicitors will be subject to the rules that will apply to all of them regardless of where they work. But this will put huge pressure on some individuals. If an inexperienced solicitor is working for an unregulated organisation they can find themselves conflicted between the demands of the business and their personal professional rules. 

The Legal Ombudsman has echoed this worry in its response –

“While a solicitor retains many of their obligations, such as competence, conflict of interest, complaint handling, these are not requirements for an unregulated firm. What should a solicitor do when these obligations come into conflict?”

The plans have also been criticised by the Legal Services consumer Panel and the Law Society. I recently attended a forum in Liverpool where almost all of the lawyers present were opposed to the plans.

We should all encourage moves to bring legal services into the 21st century. The more bodies provided access to legal advice the better. I am also all in favour of easing the burden of regulation. That would give compliance officers like me fewer sleepless nights! But there are also minimum standards of service and protections that have to hand in hand with instructing a solicitor. Without this we will have a two year profession offering services to a confused public.

I hope that the SRA will listen to all of these criticisms and abandon what are badly thought out and dangerous proposals.

Thursday, 22 September 2016

No, Lord McNally I will not shut up about Access to Justice

The Con-Dem coalition already feels like something from the distant past. One name that we will always associate with the attacks on Access to Justice is Lord McNally. As many Liberal Democrats try to distance themselves from the excesses of their years in power, he has robustly defended the cuts which he engineered. In a speech last week he also criticised lawyers, saying –

‘A plea to all the lawyers – those coming up and those already there. You have got to accept that bandying about access to justice, it’s really quite fraudulent. To govern is to choose. Is £1.6bn access to justice? Or is it £2.4bn?’

Leaving aside the obvious insult, his final sentence is very telling. His definition of access to justice is limited to varying sums of money. Access to Justice is neither £1.6bn not £ It is not a commodity it is in fact the foundation stone of a justice system. Why have rights if ordinary people cannot rely on them? 

This cheapening of justice is nothing new. Back in 2015 the former Justice Minister Lord Faulks QC described litigation as  - ‘very much an optional activity’.

So seeking compensation for a catastrophic injury is the same as collecting stamps or going out to a nice restaurant.  Losing the right to pursue or defend their rights can have a devastating effect on a person’s life.

The other problem with McNally’s comment is that he focuses on lawyers as if they are the only ones who are affected – lawyers, as ever, are the easy target!  In fact there are hundreds of voluntary agencies who have lost funding and can longer help the most vulnerable. Back in 2013 I wrote this –

‘Advice on welfare benefits is removed entirely from the scope of legal aid. The Liverpool Citizens’ Advice Bureaux have been among the leading providers of advice in this field. In the last few years they have been able to assist 2500 people in debt cases and 6270 people with welfare rights issues. That is a total of 8770 people is the direst of need. After 1st April they will be able to advise…. None. Of course their dedicated workers do not want to let people down and many will continue help clients on a voluntary basis. But the reality is that thousands of our most vulnerable are going to be deprived of professional advice and assistance.’

Earlier this year the Head of the Supreme Court, Lord Neuberger warned that shrinking of legal aid contributed to threat to Access to Justice –

I for one have no intention of shutting up about this matter. It goes to the heart of a justice system. 

People rights cannot be reduced to simple mathematics or dismissed as optional activities.

Lawyers do not complain out of self interest.

They complain because they tend to be concerned about justice which is what brought many of us into the profession in the first place.