Tag Archives: sole practitioners

Market structure: continuing growth in the solicitors’ profession

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The Law Society of England & Wales recently published its Annual Statistics Report for 2021, its compendium and analysis of useful numbers about the trends in the solicitors profession.  (In fact, it is the second report published this year, the 2020 report having been delayed by the Covid pandemic.)

I have followed these reports for many years, charting the ups and downs in the trends.  I was therefore brought up short by this comment by the President of the Law Society, as reported in Legal Futures: “The decline in the number of firms also highlights the need for widespread investment in our justice system including legal aid rates to ensure lawyers are there when needed.”

The reason that I. Stephanie Boyce’s comment grabbed my attention is that the two elements of the sentence (decline and need for public investment) do not on the face of it appear to be supported by the data or even connected.  Some further digging into the report and other sources was called for. Continue reading →

Sole practitioners and regulation

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I was interested in a piece in this week’s Law Society Gazette (see http://www.lawgazette.co.uk/news/compliance-rules-may-hit-sole-practitioners).  The Sole Practitioners Group has warned that treating sole practitioner firms (SPFs) in the same way as other firms could lead to many of them no longer practising.

The SRA wants to simplify the regulatory framework, and therefore SPFs would have to appoint a compliance officer for legal practice (CoLP) and a compliance officer for finance and administration (CoFA) – in the same way that other firms and ABSs will be required to do.  The SRA recognises that the same person might be appointed to both roles (although the CoLP must be legally qualified).  But the SPG claims that individuals within SPFs would not have the time to perform both roles effectively.

Now, I have a good deal of sympathy for sole practitioners having to cope with an ever-increasing compliance burden.  It is much the same for many small businesses.  But I have to say that, if a sole practitioner wants the privilege of providing legal services protected by statute (the reserved activities), surely they can’t complain if they are required to be accountable to the regulator for those services through an individual who carries the responsibility?

It is undoubtedly relatively more burdensome for one individual in a sole practice or small firm to discharge compliance functions.  However, it seems to me that clients and the public have a legitimate expectation that those who are regulated will be properly supervised by the regulator.  If SPFs and other small firms cannot do this effectively (apparently on their own admission – or, at least, the SPG’s), this does rather support the argument that they are too small to be economically viable and present too great a risk to the public and the reputation of the profession.

Was that the conclusion the SPG intended us to draw?  Does the Law Society agree?  Does the SRA know?  Are the professional indemnity insurers watching?