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Solicitor trust…

...and why the consumer deserves a new look legal service

Alistair Morris,

CEO of Pagan Osborne, writes:

Where do lawyers rate in your estimation?

It is an interesting question to pose after a few traumatic weeks for the legal profession where we have seen one solicitor jailed for fraud and a very well respected Scottish firm fall foul of the hard economic times and shut its doors.

Lawyer Richard Housley, and accountant Caroline Laing were found guilty of money laundering in January, having helped businessman Michael Voudouri and his associates hide £1.8m of cash from the authorities. Housley was also convicted of income tax fraud and a separate charge under the Proceeds of Crime Act.

Semple Fraser, a law firm of long standing that employed over 120 staff suddenly announced it was going into administration in March, with many clients switched to other firms.

It is always very difficult when events undermine the trust and reputations of the many thousands of Scottish solicitors who are doing a very good job, every day. Yet, beyond these headlines, the profession is currently undergoing a very profound and dramatic change, which more than anything else should be welcomed by those who want a legal sector that puts the consumer first.

By the end of this year it is hoped that there will be new kinds of law firms emerging - or Licenced Legal Services Providers (LPs) as they will be known in Scotland - that will be owned and run, not just by lawyers but also by other professionals or business people. While the majority ownership will be in the hands of solicitors, new non-legal expertise on the management board introduces a wider perspective: new skills can drive a more relevant legal service and ultimately a greater check and measure on a firm’s activity.

It may mean trusted brands such as the Co-op will start to offer legal services in Scotland or that related services such as financial advice are more closely integrated with advice about your legal position. In time, we may also see highly bespoke services for elderly care or home ownership that include all the legal considerations as part of the package.

The fundamental rationale behind this change is to boost competition and increase investment, but above all empower the consumer. Greater competition provides greater consumer choice and greater consumer power drives innovations in terms of service, price, delivery and transparency.

The impact of opening up ownership of legal services businesses will be significant and while the legal professional still has some way to go, the consumer doesn’t have to look too far to see some of the changes that are already taking place.

Lawyers are likely to be far more accessible than they were before: Saturday clinics, longer office hours and constantly availability via mobile phones are part of what we now do at Pagan Osborne and are not the rarities across the profession that they once were. Information is also far more readily available, particularly online, which helps with all decision making, from the choice of solicitor to knowing what to ask when sat in front of them. There’s also increasing commoditisation from Wills to conveyancing, opening up a spectrum of service levels, from the do-it-yourself through to the 360 degree bespoke relationship, that simply did not exist before.

The Legal Services Consumer Panel (LSCP) reported that 22 per cent of consumers now shop around for legal services, up from 19 per cent the previous year, with evidence that consumers are finding it easier to compare providers. It won’t be long before a ‘compare the market’ style comparison website will be as familiar to consumers for legal services as it is currently for car insurance.

But there is another side to the coin.

Our open and fair society is protected by the Rule of Law and access to justice for all. A strong independent and trustworthy legal profession is critical to this. With profound change in the air, traditional values are more relevant than ever. It is incumbent on the Scottish legal profession to embrace the transfer of power to the consumer but it must also respect its continuing role in wider society.

Some will argue that the introduction of non-legal shareholders within a legal firm will undermine the integrity of the profession. For me, this is far from inevitable. If approved by the Scottish Government, the Law Society of Scotland (LSS) will be the regulator of the new LPs to ensure consistency and maintain high standards. It was this system, with its thorough inspection regime that unearthed the misconduct of Richard Housley.

In 2011, the LSS asked MORI to conduct a survey of consumer opinion. It found 95% trusted their own solicitor with 86% trusting the profession as a whole.  These are good figures but not ones to be complacent about. What is particularly interesting in the new legal landscape now that LPs are on our doorstep is that consumer opinion will play a far greater role in determining the success or failure of a law firm.

It all comes back to trust and trust has to be earned.

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