Looking to the Future

INTRODUCTION

Looking to the Future

WINTER 2021

Having served as Council Member for Central and South Middlesex since 2005, I will be leaving the Council at the next AGM to be held in October 2022 by which time a new council member will have been elected to represent North West London. It is crucial to the ability of the Law Society to function well and lead the profession whilst adapting to meet the ever-changing needs of members that experienced members stand for election where they believe they have the interest and skills or can otherwise contribute to the work of the Council or its Committees.

During my period of tenure, the advice and support from our members has been a source of knowledge and encouragement enabling views to be strongly represented and issues to be confidently raised to meet the needs of practising members.

Reflecting upon the period since 2007 when the Legal Services Act was passed, I believe it has brought changes that have to some extent been liberating to members wanting ever more deregulation but, in other ways perhaps damaging to the standing and values of our profession through many unintended or ignored consequences.

The early years of the Solicitors Regulation Authority were marked by difficult discussions concerning areas of responsibility and reluctance on the part of the regulator to work within guidelines respecting the respective roles of the regulator and interests of the representative Society as laid down in the Act.

More recently, the Legal Services Board [LSB] has become markedly more political and activist. It has encouraged the SRA to further unpick elements of the regulatory structure without full regard for unintended or perhaps intended consequences as so amply illustrated by the opening of the Land Register since 2003 with ever increasing fraud and theft of title ownership. This is a threat to the standing of the profession and the trust placed in it by the public.

Models of practice have been deregulated and there is pressure to unbundle services and automate them as the SRA is ‘supporting the adoption of technology and innovation in the legal sector including by building new partnerships in the lawtech arena’. Comprehensive public protection through insurance is repeatedly questioned.

The demographics in the profession have changed with male solicitors now comprising a minority and the female majority in the profession are aged under 45. Around 25% of the profession now works in organisations which are not solicitor firms. The traditional law firm is no longer a popular model, and the modern profession wants more defined and narrower responsibility, high wages and work/life balance. Meanwhile the new entry requirements and SQE heralded to reduce cost and maintain standards are under way and it is uncertain who will be the winners from this change.

As this process continues, difficulties are arising over ethical values and the boundaries for professional privilege and other conflicts of interest. The recent Postmasters case highlights some of the difficulties where professional obligations come under pressure from commercial interests. The judgment in the shocking case is now the subject of a judge led enquiry (Bates and Post Office [2019] EWHC 3408). Even the efficacy of a solicitors’ undertaking has recently come into focus in the Harcus case discussed elsewhere and changes to procedure will no doubt follow.

A recent initiative by the LSB introduced new Internal Governance Rules. These required the structural separation of the SRA from the Law Society and control of the process for approval of annual funding from the profession that enables activities of the SRA and the Society. This year all SRA operations have been transferred from the Law Society to a separate company which is being registered as a charity organisation. This may give rise to further difficulties in the future.

The budget constraints are of continuing concern as the budget for 2022 has been capped at the same amount for the third year. The PCF (Practice Fee Application) is prepared separately by the SRA and the Society, and the LSB is now applying new and strict rules over the way in which applications must be prepared and how they will be considered for approval. It is now almost impossible for the Law Society to increase its share of the practice fee income unless this has been forecast and notified 3 years in advance. These constraints may have to be addressed in coming years.

The budgetary constraints on the Law Society are very real. The Society has worked with an allocation of about £28m which is under severe strain from pandemic disruption, wage inflation and the high cost of maintaining online services. The costs of the programme of capital investment in technology and updating the premises at 113 Chancery Lane have not been recovered and further investment is needed. The Society will be publishing a Reserves Policy and it seems likely that funds will be needed to ensure that the organisation remains viable and has the resources it needs to support its offering to members.

With the benefit of the new technology, offers for training and new accreditations are being developed and it is to be hoped that this activity which is very much of the essence of a good membership organisation will be allowed to survive.

Meanwhile the LSB encouraged by the Competition and Markets Authority openly states that it has ambitions to change the sector. It oversees 9 approved regulators and yet its sector wide strategy for reshaping legal services ranges far beyond and well into the world of unregulated services and their providers. One is led to question whether this is a legitimate role under the Legal Services Act or rather whether this should be a matter for legislation.

The clear problem that no one is able to adequately tackle is public legal education. Law is not taught at school and most have no experience of business or consumer issues until much later and then learn from experience or avoid the law as too remote and impenetrable. Modern legislation is too complex for society to accept that situation.

This provides the backdrop for a diet of issues that will continue to vex the practitioner but also opportunities that will prompt the next generation of solicitors to target different areas of practice than in the past. I wish them and my successor well. ■

Michael Garson

Michael Garson

Council Member The Law Society