The lawyer and the plumber

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When I've finished this. love, I'll knock you out a will

By Neil Rose, Editor, Legal Futures

In my last blog, I posed a question that hardly any lawyers I have come across have been able to answer: can you name the eight legal professions? As promised, now I ask another that I suspect a similar number of lawyers will know the answer to: can you name the six reserved legal activities that can only be undertaken by an authorised lawyer?

I won’t keep you in suspense this time. They are:

• The exercise of rights of audience;
• The conduct of litigation;
• Reserved instrument activities (that is, dealing with the transfer of land or property under specific legal provisions);
• Probate activities;
• Notarial activities; and
• The administration of oaths.

For the full detail, see schedule 2 of the Legal Services Act 2007 – here.

This detail is important, particularly in relation to probate activities, because for the purposes of the Act, these are restricted just to preparing papers on which to found or oppose a grant of probate, or a grant of letters of administration. Nothing on the actual administration of an estate, say, which one might argue is where the greater risk of mischief lies and where the reassurance of ensuring it is dealt with by a properly qualified professional might be essential.

Anyway, this list of six activities is, in some ways, all that separates a solicitor from a plumber who fancies setting himself up as, say, a “legal adviser” (although it is already well established that the plumber would not be interested in doing legal aid work because it doesn’t pay as well as his day job). It is quite a sobering thought and one reason why alternative business structures may not be quite the revolution some predict – the fact is that many of those who want to get into the legal market can already do what they want (on the same note, nothing has stopped Halifax Legal Express bringing together all the elements of a legal service under its brand – all it cannot do at the moment is own some of them).

It is also a sobering thought that, if they wanted to, the big City law firms could stop paying millions in practising certificate fees for their many transactional lawyers who never go near reserved work, which would not be good news for other PC holders who would have to pick up the slack. No wonder the SRA is moving to charging most of its fees on an entity basis.

The debate over reserved legal activities tends to focus on what should be added to the list, rather than, perhaps, taken away, with will-writing the main suspect. It might seem quite a straightforward consumer protection argument that those who write wills should be qualified lawyers, but my interview with Dianne Hayter, chairwoman of the Legal Services Consumer Panel (see here), indicates that it has many more layers to the issue than one might have thought, which will disappoint those like the Law Society who have campaigned on this issue so vigorously.

The Legal Services Board has the issue of reserved legal activities in its 2010/11 business plan, starting with work to understand the costs and benefits of regulating currently unreserved legal activities and identifying criteria for determining whether an area of advice should be regulated. It will have to weigh up the need to ensure consumer choice with the need to have a level playing field across the legal services market. My sense is that there will not be a rush to add areas to the list.

Essentially, though, the point is that innovation is already possible and already out there because so little work is reserved. Take the terms and conditions and privacy policy on this website. I was pointed to a website run by a qualified solicitor but whose business, the site clearly states, is a legal consultancy, not a firm of solicitors, and so not regulated by the Solicitors Regulation Authority. This is no doubt much cheaper and easier for him. Interestingly, this service could be offered by anyone, but I was reassured by the fact that a solicitor with experience of the field was behind it, showing there remains much value in the brand.

He has produced template T&Cs and privacy policies, with advisory notes to help users customise them, for download after paying around £30 each. No need to be regulated because there is nothing remotely reserved about this activity. I didn’t have to go to the expense of a lawyer drafting something from scratch, while the solicitor just sits back and keeps on making money from a single piece of expert work. In Richard Susskind language, this is moving from the traditional one-to-one model of providing legal advice to a one-to-many model.

The clever solicitor might examine the nature of his workload and hive off the non-reserved work, such as will-writing, into a limited company, maybe with external investment so as to ramp up its scale and efficiency, although the risk is that the LSB’s review of what is reserved could throw everything up in the air again.

But what this also shows is that it is an issue that may look esoteric, but is central to the future of lawyers. The argument has been made, by Law Society chief executive Des Hudson among others, that the transfer of registered land is essentially an administrative, rather than legal, task. Should it therefore still be a reserved activity? Think of the potential fall-out if it wasn’t.