Editors Blog

Above the conflict

18 Jun 12

Regulating ABSs does not automatically generate an additional conflict of interest for the Society

Last month’s articles on the future of the Society, particularly the opposition to compulsory membership, are followed in this issue by the replies for the Society – and it appears that there is indeed an alternative legal argument to that put forward by John McGovern. The question of compatibility with article 11 of the Human Rights Convention remains open.

The issue is bubbling away just as we learn the date – 2 July 2012 – for the opening of applications for authorisation as regulator under the Legal Services (Scotland) Act 2010. Intelligence has it that the Society is well ahead of any likely alternative body in its preparations, so those legal services providers that wish to be licensed as alternative business structures will have no choice, initially at least, but to seek the Society’s approval.

Some argue that the “conflict of interest” inherent in the Society’s dual roles is considerably escalated if the Society takes on this further function, in relation to businesses which in their very nature are set up to compete with solicitors’ practices as currently constituted. In reality, matters are nothing like as clear cut. If one of our larger practices wants to give its senior non-lawyer managers a stake in the firm, it must reconstitute as an ABS even if it otherwise carries on as before. Does it thereby acquire interests contrary to those of the rest of the solicitor profession that it did not previously have? ABSs cover such a spectrum that if there is a line to be drawn as to what the Society should attempt to regulate, it does not lie in the very fact of operating as such.

An interesting diversion for me each month is looking through the Journals of yesteryear for our Archive entries, particularly 25 years ago, already some years after I qualified. In June 1987 the Journal recorded a Society general meeting which approved, on a low turnout, the advertising rules in more or less their modern form, the previous, restricted version of which had been the subject of huge controversy only two years before – “an astonishing change of view”, the writer states. Looking back, it can be said that the dire consequences predicted by the opponents of change signally failed to materialise.

Professionalism was said to be under threat then, as it is now. But the 2010 Act is widening, not narrowing, the scope of regulation, and it is surely no bad thing if the Society, the guardian of professional standards, has the main say in how new providers that are effectively solicitor firms should operate.