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The best option?

15 August 05

Outline of the Law Society of Scotland's response to the consultation on regulation, with comments from solicitors and non-solicitors involved in complaints handling


Why the Society went its own way

By the time you read this, the deadline for responses to the Scottish Executive Consultation “Reforming Complaints Handling, Building Consumer Confidence” will have been and gone.

Gone but not forgotten. The consultation is only a step in a long process and could bring in changes which would have an enormous impact on the legal profession in Scotland – whichever option those in power ultimately decide on.

The effects of decisions made now will be felt not only by the Society, its staff, Council, client relations committees, lay members and clients, but by every solicitor working in Scotland – including those who have never had a complaint made against them. The reason for this is costs – every option in the consultation has a cost implication, some higher than others.

The Society has responded fully to the consultation, setting out its views on each of the four options proposed, and adding a fifth, option E – to keep complaints handling with the Society, building on the improvements already made.

This option has been put forward by the Society’s Council and proposes internal changes with enhanced independent oversight. It takes account of the fact that the reality of complaints is very different from the perception – out of hundreds of thousands of transactions handled every year by Scottish solicitors just 0.2% lead to a complaint. That perspective should not be forgotten.

In the consultation foreword Cathy Jamieson MSP, the Justice Minister recognises the many improvements the Society has made in recent years. These include the completely new complaints handling system, an increase to 50% non-solicitor members of committees looking at complaints, an increase to 14 complaints committees, achieving and maintaining the target of completing 90% of complaints in nine months, increased funding of the Client Relations Office, and the development of a new case management system recently announced which will help achieve the next target of completing 75% of complaints within six months.

The Society is continuing to modernise its complaints process, considering many other improvements and calling for changes to the now outdated legislation within which the Society works so it can meet the challenges of the 21st century.

One of the most important issues which the consultation raises is the financial impact of each of the options. Some of the options have estimates of costs and some do not.

Option A

What is it? Option A keeps complaints handling with the professional bodies, but gives the Scottish Legal Services Ombudsman additional powers including investigating the original decision made by the professional bodies; enforcing recommendations; conducting general audits of complaints files; prescribing general timescales for the resolution of complaints; and directing the professional bodies to investigate a complaint.

The Society’s response: The Council firmly disagrees with some of the additional powers proposed for the Ombudsman and it goes one step further – proposing that the Ombudsman as an individual is replaced by a board, for consistent decision-making.

Estimated cost: Not given.

Who pays? The taxpayer.

Option B

What is it? A single gateway for complaints about all legal practitioners, with oversight functions.

The Society’s response: The Society’s Council disagrees with option B for the same reasons as option A – the difficulties with enhancing the role of the Ombudsman – and because a single gateway could increase bureaucracy and delay, both of which the Society has successfully reduced.

Estimated cost: £100,000 additional costs to run the Ombudsman’s office.

Who pays? The taxpayer.

Option C

What is it? A single gateway for complaints against solicitors and advocates with substantive complaint handling functions.

The Society’s response: The Society’s Council does not support this option as it could create an additional layer of bureaucracy, potentially leading to more delay. The cost of this option could be considerable as a separate appeal body would have to be set up. The Council does not agree with the estimated costs (see below), as an independent system would have to be set up, and funded by the taxpayer, through the Executive.

Estimated cost: The consultation says £2m a year (£300,000 from the Ombudsman’s office and £1.7m from the Law Society of Scotland, but this is an underestimate as a recent parliamentary question revealed the budget for the Ombudsman’s office was approaching £400,000, whilst the Society’s budget for complaints handling is set to rise to just under £2m in 2006-07, making a total of at least £2,400,000 for this proposal.

Who pays? The professional bodies and the profession through a “polluter pays” scheme, and therefore ultimately the client..

Option D

What is it? Option D is an independent complaints handling body managed by a board with a lay chair and lay majority.

The Society’s response: The Council does not support this option as it believes that keeping complaints with the professional bodies with an equal input from non-solicitors to balance the interests, is the only way to help maintain and improve standards within the profession and to gain valuable feedback from complaints.

Estimated cost: “Broadly similar to Option C but slightly more expensive”, according to the consultation. The Society estimates that setting up an independent body could cost almost £5 million, which is a conservative estimate when you consider the costs of setting up an independent body in England and Wales.

Who pays? The legal profession, on the same basis as option C, and therefore ultimately the client.

Option E

What is it? Proposed by the Society’s Council – internal changes and enhanced external, independent oversight in partnership with the Scottish Executive to improve the existing structure of regulation, make it more transparent and improve remedies for complaints. Option E is designed to enhance consumer representation and reinforce the independence and impartiality of the Client Relations Office, whilst providing substantive relief for people dissatisfied with the Society’s handling of their complaint. The Council also proposes that a new appeal body is established which would be an independent and impartial appeal mechanism with substantive remedies to complainers unhappy with the Society’s handling of a complaint.

The Society’s response: This option was put forward by the Council and is not included in the consultation. The Council takes the view that it is better to improve the existing system rather than create new options.

Estimated cost: The Society has budgeted just under £2m for 2005-06 for running the Client Relations Office. This includes the estimated 2005-06 costs of paying a nominal sum to reporters and committee members, approximately £325,000.

Who pays? The profession through the cost of practising certificates, and ultimately the client.

Are you are still sitting comfortably, and thinking: “What complaints?”

Take the situation if either option C or D were introduced. What if a vexatious complainer intent on damaging your credibility, name and business made numerous, unjustified complaints? Will the “polluter pays” costs continue to mount until solicitors working on tight profit margins are forced out of business? Will larger firms have to employ more than one client relations partner to deal with vexatious complaints? 

The consultation states that the Society will spend £1.7 million this financial year on its complaints handling function.The actual costs are almost £1.9 million this year 2004-05. Next year’s budget is already £2m. Yet this figure is the basis for the estimated cost of the new bodies under options C and D and does not include set-up costs, nor does it accurately reflect the huge contribution of the many people who offer their time to committees work for £50 a meeting, including preparation. The Society is grateful for the tremendous amount of work of the 200 reporters who are paid a flat rate of £100 to prepare and write reports, some of which can take several hours or even days. Would people be as willing to do this for aquango?

Going with the rate of £118 per hour, the cost of a report costing 4.2 hours would be £500. Likewise, with committee members, each meeting lasts approximately three hours, so £50 hardly reflects the time, abilities and commitment required of all members.

Each of the options will cost more than the current system, but that is to be expected – as the professional already knows, improvements come at a price. But how far the Executive will be willing to go and at what cost to the taxpayer and the profession, which already contributes almost £1 billion to the Scottish economy, should be one of the consultation’s major talking points.

Then there is the whole other issue of which option will work and which will work best in the interests of solicitors and their clients. It could be a hard balancing act.

To read the Council’s full response, please go to the Society’s website, www.lawscot.org.uk on the homepage under the heading “Regulation of Solicitors in Scotland/Justice 1 Committee Enquiry”.

Public perception is not all

So we have submitted the response to the Scottish Executive’s consultation paper on Regulation of the Legal Profession and received this year’s Scottish legal Services Ombudsman’s annual report. The latter was one of the most positive reports the Society has had, rather ironically saying that the changes need more time to bed in while the Scottish Executive consult on extensive change.

Yet again self, or more precisely co-regulation is under the microscope or as one headline put it recently, “in the dock”. It should be remembered that the Society is required to undertake regulatory work by statute. The Society has the dual role of promoting both the interests of the profession in Scotland and the interests of the public in relation to the profession, in respect of which it must investigate complaints of inadequate professional service and allegations of professional misconduct.

The Ombudsman’s powers are also statutory and are generally to examine the Society’s complaints handling procedures. The Ombudsman is not an appeal tribunal from decisions of the Society, a point sometimes misunderstood by complainers.

Over the years, and particularly recently, the Society through its Client Relations Office has refined and improved its procedures, often of its own volition as well as at the suggestion or recommendation of the Parliament and Ombudsman to a point where the Society is proud of its structure and successes. No system is perfect and the Society will continue to adjust and review. However some complainers will never be satisfied no matter what is in place, especially if their complaint is not upheld.

Members of the Justice 1 Committee attended client relations committee meetings in 2003 and said they were impressed at what they saw. The committee reported that the best option for the people of Scotland was for the Society to retain its regulatory powers with reforms where appropriate.

The consultation paper has four suggested alternative options for regulation, none of which is to retain the status quo.

Last year, Sir David Clementi reported on regulation in England and Wales where there were clear and admitted problems. We are of course a different, and much smaller jurisdiction and what is seen as best for south of the border should not be regarded automatically as best for us.

The recurring and probably main criticism of the Society handling complaints is that of the public perception. No matter how the system may actually work in practice, if there is a public belief that lawyers are simply protecting lawyers then apparently we have a problem. This is articulated in paragraph 1.2 of the consultation paper: “there is a general feeling that the overall process might be weighted in favour of the lawyer”, and in the Ombudsman’s report when she refers to people being concerned at the structure of the legal profession in Scotland and the Society’s role in regulating it.

I am fed up hearing the “perception” argument. Either the system is working or it is not. An accused may perceive the judge to be biased, but if the judge has applied the law properly and is doing his job then that is the end of it. On client relations committees it is often the solicitor members who speak out loudest against the solicitor complained of, and sadly the contribution of non-solicitors, so valued in the Society, seems ignored by those only too ready to criticise it.

Public confidence is important, but my belief is that lack of it is frequently overstated by critics of the present system, which distorts the perception.

I have been involved with client relations for over five years in various capacities and have never failed to be impressed at how fair and open the procedures and discussions are. There are now equal numbers of non-solicitors on the client relations, Professional Conduct and Client Care committees and on the sifting panel. There are also numerous non-solicitor reporters.

Discussion is open and often robust with all committee members contributing, listening to and respecting the views of the others. It works well.

As the Ombudsman herself said in a recent newspaper interview: “If you have a problem with your plumbing you do not get a joiner to come in and report on whether it is adequate.”

What the Society does need is recognition that the changes and improvements are working and it needs to be empowered to continue its programme of change.

Morris Anderson is Convener of the Client Care Committee

Reform for the right reasons

There are positives to be taken from the consultation paper in that it is acknowledged that most people receive an excellent service from their solicitor and that progress has been made in improving the regulation of the profession, with more lay members and staff being involved.

The Executive recognises the arguments for the legal professional bodies to remain primarily responsible for the complaints handling process and also accepts the strength of the argument put forward by the Justice 1 Committee that a completely independent complaints body is not required in Scotland.

The Executive then takes the view, however, that the door should not be closed to a more radical approach involving a clearly independent body being set up under the management of an independent board. This strikes me as though the Executive is prepared to consider going even further than Justice 1 envisaged and I wonder on what basis it makes such a suggestion. Also, it might be interesting to know how many members of the Justice 1 Committee have been involved in the current consultation.

The Executive appreciates the benefits of a familiar structure with increased powers for the Ombudsman, but again seems to favour a more independent approach while considering that a gateway system might be an appropriate adjustment of self-regulation.

The adoption of a single gateway with substantive complaint handling functions, or an independent complaints handling body managed by a board with a lay chair and lay majority, would clearly have a considerable impact on the current system.

As indicated, the Executive now seems intent on going further than Justice 1 and the concern must be as to how many responses they receive and from whom. Further, will those responses be representative of the Scottish public or will parties with vested interests predominate?

Hopefully the Executive will not only take full cognisance of the responses received but also reflect the nature of and reasons for such responses.

Chris Fraser is a non-solicitor member of a client relations committee

Building confidence, achieving value

As a CAB manager I have considerable experience of assisting members of the public in resolving complaints. I have been a lay reporter to the Law Society for two years, am a member of a client relations committee and have recently been invited to join the Client Care Committee.

“Reforming Complaints Handling, Building Consumer Confidence” are, I would suggest, two separate challenges! I have been impressed by the Society’s efforts to improve the complaints handling process through the increased involvement of non-solicitors and enhanced training and guidance for all reporters, including solicitors.

Consumers will achieve confidence in the complaints handling process by having their complaint listened to and responded to fully and within a reasonable timescale at all levels of the process. Greater emphasis on the involvement of non-solicitors at all stages must be communicated to complainers by the Society.

The new requirements for solicitors to introduce a formal complaints procedure is to be welcomed, together with the Society’s new complaints leaflet.

The Ombudsman, in her latest report, has made favourable comments about the improvements made by the Society to the complaints handling process. However, as the public looks to an Ombudsman as the “last resort” I am therefore concerned that options B and C would seriously reduce the options for a complainer by removing one stage in the process and reducing the numbers of lay people involved. Options B and C would also increase substantially the cost to public funds, not satisfying the requirements for “best value”. I therefore must support option A.

Anne Hastie is a non-solicitor reporter

No need for extra lawyers

I am in a somewhat unusual position. Though I made a complaint to the Law Society against a fellow solicitor on the basis of my view that that solicitor was guilty of professional misconduct, I am currently convener of one of the complaints committees and have been involved in reporting and membership of a complaints committee now for some seven or eight years.

There have been massive changes in the way the Society handles complaints over the past few years and to my mind the major difficulty has been getting and retaining competent case managers, who are the main interface between the public and the Society in its complaints handling role.

While there have been problems, so far as I can see at the moment there is a solid body of well qualified and competent case managers now in place, the Society’s procedures have been streamlined and in the main the system works well. For my own part and looking at the example of England, I do not think a radical change would be to the benefit of the public. I do not think it would put the interests of users of legal services any more at the heart of regulatory arrangements than they already are; I do not think that the system would be any more fully representative of the public interest than it is now; and I do not think any complaints system which does not deliver to a member of the public the result which he or she wants, regardless of the rights and wrongs of the issue, will ever command full public confidence.

With regard to the Office of the Scottish Legal Services Ombudsman, I think if you tamper with the present role of the Ombudsman, then you effectively rule out that office as a body to which appeals can be made. If you give the Ombudsman more powers then you will of necessity have to look at a procedure for appeals from decisions by the Ombudsman and for those decisions to be appealable both by those complaining and those complained against, which will only add another layer of cost, bureaucracy and lost time to the existing system. In short, if you take any significant steps to increase or amend the Ombudsman’s powers, then the Ombudsman will cease to be an ombudsman and become something else entirely. If you do that with the Legal Services Ombudsman then you are sure to face calls to make the same changes for every other ombudsman in the country, including the Local Authority Ombudsman and the ombudsman who has responsibility for the Scottish Executive.

With regard to the single gateway, my experience is that single gateways often lead to many dark and confusing corridors. As will be seen from my remarks, I am not in favour of change for the sake of change alone or for political points, which is what it seems to me this is all about

I do not think we need a new complaints handling body with a lay chair and a lay majority of membership. There are frequently issues in relation to the provision of legal services, just as there are in the provision of other services, which can only be fully understood by practitioners. In the lay majority model the lay majority would have to rely on the qualified minority to explain issues which were not apparent to the lay majority, but if the lay majority declined to accept what the qualified minority said, no matter how correct it might be, we risk anarchy.

Turning to other questions raised, I think the case managers and the Society are currently able to identify what should count as a complaint against a lawyer; the category of those who are entitled to complain seems to me sufficiently wide and adequate to enable complaints to be brought by a wide range of persons; complaints committees are currently split 50-50 between lay and qualified and I think such a split would be reasonable also on the discipline tribunal; and I do believe that the Society should have wider disciplinary powers in relation to misconduct.

Ivor Klayman is a partner in Caesar & Howie, Bathgate