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The impact of ABSs on Conveyancing and Property Law

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By : Tony Lillystone    99 or more times read
In the aftermath of the Legal Services Act, will home buyers be visiting the Co-op or W.H.Smith for their Conveyancing, instead of the traditional high street Solicitor?

Or will the estate agents who marketed the house also provide their 'own-brand' Conveyancing service?

Recent changes to the law may herald a major shake-up in the legal services marketplace, giving the consumer a wider choice of suppliers. 'Alternative Business Structures' (ABSs), despite their dull-sounding title, will for the first time allow law firms to be owned by non-lawyers. This means that companies such as estate agents or supermarkets can now set up legal departments to provide legal services direct to the public.

In the view of many consumers, Solicitors firms are still stuck in the past. Client care is an unknown concept, and lawyers delight in using gobbledegook to hide the fact that the work they are doing isn't really very complicated and could be done a lot cheaper, while everything takes twice as long as it needs to.

While this is not true of all firms (and there are many good firms around who do provide excellent services at reasonable cost) the Legal Services Board does consider that opening up the legal market will lead to considerable benefits for consumers. The Board stated in a recent report:

... a more open and competitive legal services market which allows for non-lawyers to own legal firms and focus on service quality and price may go some way toward changing what can be described as a traditional culture in legal services. A stronger emphasis on delivering quality services at a lower cost and in a convenient way to the consumer may see a faster shift away from previous ways of doing business. This culture shift, while difficult to quantify, is likely to be facilitated by more competition in the market and a greater cross sector fertilisation as non-lawyer professionals are permitted to own law firms. These non-lawyer professionals can bring new management techniques to law firms such as management service design, customer insight and client journey mapping as well as packaging other products with legal services.

Although the new law came into effect on 6 October, so far only one firm has been licensed as an ABS. These new firms have to be licensed by an approved regulator, and at present only the Council for Licensed Conveyancers has been approved to issue licenses. Further changes to the law are required before the Solicitors Regulation Authority will be able to issue licenses, which should happen in early 2012. It seems that many companies who are considering setting up ABSs are waiting until then, so it will be some time before the full impact of the changes is apparent.

The Co-op is expected to become the first major company to convert, but many others have shown an interest, including several Solicitors firms. In the meantime, some law firms have taken steps to improve the availability of their services. This has seen access points being set up in high street shops such as W.H.Smith, so that customers can obtain information and quotes for Conveyancing and other legal services while doing their shopping.

Some see these changes as ringing the death-knell for high-street Solicitors. However, the experience in Australia, where similar changes have already come into effect, indicates that although there has been some consolidation by larger firms, there has been no mass exit of smaller operations. Many Solicitors have taken advantage of new rules permitting them to obtain outside funding to invest in modern technology. If this trend is followed, those who prefer to use traditional and independent Solicitors will not need to worry. The high street Conveyancing Solicitor may not be extinct just yet.
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