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Claims management companies will have to pay a separate ‘Lord Chancellor’s complaints fee’ of up to £40,000 on top of their annual regulation fee with the shift in complaints handling from the Ministry of Justice to the Legal Ombudsman.

The Legal Ombudsman’s plan to widen its jurisdiction will cause a “muddle”, the Institute of Professional Willwriters has warned, revealing that other ADR providers had indicated an intention to move into the sector themselves.

Thousands of law firms are set to contribute £1.4m to the Legal Ombudsman after the government confirmed that they will no longer be eligible for two ‘free’ complaints every year. Meanwhile, LeO has not ruled out entertaining complaints by third parties, such as against the opposing party’s lawyer.

Regulators need to take urgent action to improve the way lawyers handle complaints after a “hard-hitting” new report highlighted multiple failings. However, although clients are often scared to complain, a positive experience when they do can actually make them likely to recommend the provider.

The Legal Ombudsman is going too far in proposing to allow prospective clients and third parties to complain about lawyers, the Law Society has claimed. Chancery Lane found support from the Council for Licensed Conveyancers.