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Sep rep: what now?

14 October 13

The Society's Professional Practice team answers some questions following the vote against a rule change relating to separate representation in conveyancing transactions

by Kaira Massie

The Society has come out rather publicly in favour of sep rep. What will you do now you’ve been defeated? (Martin, Glasgow)

The Council of the Society supported the findings of the separate representation working party. At the March 2013 AGM, the LSS was mandated by its members to bring forth a rule change dealing with the issues as described by the working party. The Society supported the members’ wishes to deal with this using a rule change.

There has been an overall change in mood in the profession, perhaps arising from the unintended consequences as described in the consultation paper and the consultation response. Additionally, the prospect of using subordinate legislation to tackle the perceived issues surrounding separate representation was described by many as “using a sledgehammer to crack a nut”. Notwithstanding this, a large minority of the votes cast (44%) were in favour of supporting a rule change and this suggests that the issue is still very much a live one.

The Society recognises that acting for any two parties to a transaction, particularly a lender and borrower, could create a potential conflict of interest situation. At the SGM, the CML promised enthusiastic engagement with the Society on the issues with the CML Handbook. Depending on the outcome of these discussions with the CML, or the speed at which they take place, we may issue further guidance to deal with those parts of the CML Handbook that create or exacerbate conflict situations, or are otherwise at odds with acting for two different clients in the same transaction.

Acting for two parties in the same transaction is a commercial reality and creates situations rife with the potential for conflict.

I’m delighted that solicitors voted against the change at the SGM, so I’m confused that the Regulatory Committee will still want to look into this. Why, given that solicitors have voted against this? (John, Dundee)

The rule change brought forward at the SGM was a draft for consultation, as the Regulatory Committee recognised that the draft rule was significantly changed from that which appeared in the consultation paper over the summer.

The Regulatory Committee asked that solicitors vote on the draft rule to help inform their thinking. It may be the case that they decide not to proceed with looking further into the issue now solicitors have voted down the draft rule change.

However, the Regulatory Committee recognises that the issues underlying the debate are complex, as was reflected in the full and insightful 90-minute debate at the SGM, and that further work may need to be done to address these issues. The Regulatory Committee will meet again on 24 October to discuss the matter further.


Kaira Massie is a solicitor in the Professional Practice team. You can contact Kaira on 0131 226 8894 or seprep@lawscot.org.uk
Solicitors who wish to discuss any matters relating to conflict of interest, or any other aspect of ethics or professional practice, should call the Society’s Professional Practice team on 0131 226 8896, or email seprep@lawscot.org.uk
Full information about sep rep can be found at www.lawscot.org.uk/seprep  

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