Reserved legal activities – where next?

The current reserved activities are rights of audience, the conduct of litigation, reserved instrument activities (sometimes inaccurately referred to as the conveyancing reservation), probate activities, notarial activities, and the administration of oaths.  The Legal Services Act 2007 gives the Legal Services Board the power to recommend changes to this list.  The Legal Services Institute (LSI) expressed the view in early 2010 that, before the Board considers exercising its powers, it should establish criteria for reservation that it could apply to both current and prospective activities.  Our first paper therefore investigated the origins of the reserved activities to see if, from their history, any criteria could be suggested.  Unfortunately, we found no coherent policy or rationale underpinning them.  We therefore went on to consider in our second paper (available here) what might provide a contemporary rationale for reservation.

 

The case for reservation

For the future, we consider reservation to be appropriate where:

(1) regulation, and reservation in particular, is in the public interest; and

(2) either other regulatory responses are less effective;

(3) or reservation affords a degree of additional protection to clients.

We suggest that reservation can be justified in principle on the basis of the public interest if it either secures a public good or offers consumer protection.  We therefore suggest that
reservation is justified in the public and consumer interest where, as a result of legal advice or representation, detriment to the consumer’s (a) liberty, (b) physical, mental, emotional or social well-being, or (c) property, could arise, and for which compensation after the event would not represent an adequate or reasonable remedy.  However, we do not think that this supports the reservation of all ‘solicitor services’.

 

Public good reservations

The LSI considers that the requirements of the rule of law, the administration of justice and access to justice, as well as the benefits to England and Wales of having a well functioning legal system, justify the continuing reservation of rights of audience, the conduct of litigation, and court-related reserved instrument activities.  Equally important
are the proper execution of the administration of oaths and notarial activities, for the effective administration of justice, and to support reliable social and trading relationships both domestically and internationally.

There is also a public good in having an effective and reliable property market.  In part, this arises from the support of conveyancing chains and simultaneous completions, which in turn are based on the credibility and enforceability of undertakings given by the authorised persons involved.  Rather than the current narrow reservation of preparing the contract and the instruments of transfer or charge (which does not address the public benefit that needs securing), we believe that there is a strong case for the extension of reserved instrument activities to include all conveyancing services.

We would also consider that immigration advice and services might now be added to the public good group of reservations – moving them into the mainstream of reserved legal activities from being regulated (but not reserved) under a parallel but largely identical regulatory framework.  This was in fact suggested in the White Paper that preceded the Legal Services Act, but was not followed through at the time.

 

Consumer protection reservations

Problems with a will are only likely to come to light after the death of the testator, and after-the-event remedies are not sufficient.  The LSI therefore believes that there is a strong consumer protection case to be made for the reservation of will writing.

The probate reservation is in our view the most contentious of the Act’s current list, and its narrow scope difficult to justify on public good or consumer protection grounds.   We therefore advocate its removal from the list of reserved legal activities, with a strong case then for a broader reservation of the administration of an estate following a grant of probate or letters of administration to protect against misappropriation or misadministration.

Finally, although insolvency practice and claims management services are both currently regulated, we could not see a sufficient justification for bringing them within the framework of reserved legal activities.

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