The Scotsman law debate: If profession can adapt, the future's bright

THERE was certainly no shortage of subjects to be discussed, as the great and the good of Scottish law gathered in The Scotsman building to examine the state of the Legal profession.

Held as the inaugural event in the programme leading up to the Legal Awards 2009, the debate touched on the recession, education of lawyers, the imminent introduction of home reports and the fledgling complaints handling system.

The panellists were Ian Smart, vice-president of the Law Society of Scotland; Jane Irvine, chair of the Scottish Legal Complaints Commission; John Scott, a solicitor advocate, partner with Capital Defence and the chair of the Howard League for Penal Reform in Scotland; Martyn Evans, director of Consumer Focus Scotland and former visiting professor of law at Strathclyde University, and Linda Urquhart, chief executive of Morton Fraser and vice-chair of CBI Scotland.

The debate was chaired by freelance journalist Jennifer Veitch, a regular contributor to The Scotsman law and legal affairs section.

CAN the new complaints handling regime improve services to consumers and restore faith in the legal profession?

Jane Irvine (JI): I am not sure that faith in the legal profession ever went. However, there are some people who haven't had complaints handled well that do need a new system. Insofar as complaints handling systems can restore confidence, in that people can see there is a way to have disputes resolved, yes I think it can do that.

Martyn Evans (ME): I don't think that a complaints system, by itself, can do anything to improve the service offered to consumers. That is a matter for the profession. Will this separation make a difference? I hope it will. They key is for the profession itself to be clear about its standards, adhere to those standards and say we're not going to tolerate people who don't abide by them.

Ian Smart (IS): It's a matter of people having trust in the system. An independent body, hopefully, will give people greater confidence. Even the most perfect complaints body in the world, in itself, is not going to transform the delivery of legal services. But remember, it is a fractional number of legal transactions in Scotland that give rise to any form of complaint.

Will the commission lead to a downward trend in complaints?

IS: You can't really say it will affect that one way or the other. We are trying to codify what is an acceptable standard of service against which, not just solicitors can judge the service they have provided, but someone who is minded to make a complaint, can see where the solicitor failed to meet these standards. Part of the difficulty is that the sort of people involved in litigation are, by nature, people more inclined to make a complaint. Sometimes, bluntly, the complaint amounts to no more than "I have lost my case".

JI: It will go up initially, that is inevitable. There are several reasons. Complaints rise in a recession, complaints usually rise after Christmas, and we are now presented with £20,000 compensation which brings a larger number of people into the net. However, we shall only be counting the complaints that get into our system, which means that a sifting process that may get rid of some of the vexacious or trivial ones. I hope over the next five years, we end up with a curve that is coming down, because firms are dealing with them much better at source – that has to be the answer.

Do you think that standards for the profession will have an impact?

JI: I welcome the fact the Law Society have looked at their code of conduct. That was a job that needed to be done for a long time and it could be an area in which we work with the Law Society and the Faculty of Advocates. The commission won't set the standards but we will continue to push for the professional bodies to review theirs.

ME: The Law Society has been too absent from the discussion on standards for too long. That has been changing and all due credit to the present regime. We have asked for things like letters of engagement for a very long time. This is not about the best practice for good solicitors. The biggest risk comes from sole practitioners and there are 400 of those out of 1,300 firms. I do think the trend is right for standards and I think they will be welcomed by the huge majority of the profession.

Are the Scottish and UK governments doing enough to promote the interests of the legal sector in the recession?

Linda Urquhart (LU): I don't think the needs of the profession are different to the needs of any business at the moment. Cash flow, I suspect, is a huge issue for the legal profession, and particularly for those in areas where most of their practice is in residential property. Frankly, I am astonished that some people are still surviving. I think the Scottish Government is trying and the Pre-Budget Report made some attempts to kick start the economy, but I didn't see much in it that I think is going to make much difference to firms in Scotland.

John Scott (JS): My practice is criminal law and our work is predominately legally aided, so it is different. This is a question that shows there are two different professions within the profession. To the extent that any business needs the support of government, inevitably, people will always feel they could be more supportive. The recession hit us at a time when there were meaningful discussions with a justice secretary who was a legal aid practitioner himself and understood some of the issues. Unfortunately, our issues have been submerged by bigger concerns, but they are still on the table.

IS: The key thing is to get some liquidity into the system, to get the banks to start lending again. What has happened in the domestic conveyancing market is all to do with the withdrawal of affordable mortgage products. The government does now have a significant stake in a number of major lenders, but the difficulty before was that they were lending too easily and to simply go back to that is storing up problems for the future. There is no immediately easy solution.

With a profession that, in parts, is so dependent on conveyancing, why has the law society not been more vocal more quickly about home reports?

IS: There are different aspects of home reports. We don't have any difficulty with the seller's questionnaire or the energy certificate. As far as the seller's survey is concerned, we have been, and remain, utterly opposed. To introduce the seller's survey in the current climate is a policy initiative that makes the poll tax sound like a great idea. It cannot make things better, and I suspect it will make things significantly worse.

ME: Home reports is not a legal question, it is about buyers and sellers. The question is whether the reports are there to improve that process and of course they will. It will give more information, and benefit buyers, sellers and the market. The connection to the recession would be much more plausible if home reports were not opposed during the boom years, yet they were.

LU: I don't know what the impact is going to be, but as we currently stand one of the big pieces of positive feedback we get is on the speed of the Scottish conveyancing system. Introducing home reports, at the moment, is going to slow that process. There may be a blip that may reflect poorly on the home report and may then affect consumers' views on them.

Everyone seems to agree that alternative business structures (ABS) are a good thing. Are they?

LU: There are very different markets at play. What may give one group huge advantages and opportunities may give others big challenges. I think there are opportunities from some of those who feel they are under threat from ABS. Some high street firms have had real difficulty in recruitment and succession planning. Will this give them an opportunity to set up a business with others in their locality to do different things?

ME: We are in favour of examining restrictive practices to see if they are in the consumer interest. The restrictive practices against ABS in advocacy and solicitors could not be justified. What they will bring, the market will determine. The worry about ABS is misplaced. There is concern about commodification, but consumers don't commodify markets – practitioners do.

JS: I don't share Martyn's faith in the market and I don't think the interests of the consumer are necessarily identical to the interests of the public. I am an optimist, but this is an area in which I am less optimistic and set against alternative business structures. I think some of the big firms think we are Luddites, holding them back and preventing them from getting at large sums of money. At the same time, we think you are going too fast and we have concerns about some of the ethical considerations. The market has no morality or ethics.

IS: I am with Chairman Mao on this – let a thousand flowers bloom. Different firms operate in different markets but the kids who are qualifying as lawyers now want to compete in an international market and our top firms want to compete in that market – partly to make money and partly to keep these staff. We need business structures that will attract people to work here and respond to the demands of our profession. Having said that, there is an ethical issue. It must be open to question whether banks should be allowed to provide legal services when they are also providing a financial package. While I am in favour of this in principle, even if I wasn't in favour of it, I would be alive to the fact that big commercial firms here would be swallowed up by bigger firms south of the Border or choose to become firms regulated in England.

What are your thoughts on the recent changes to legal aid – will the increase in the threshold help consumers?

ME: It is welcome, but more complex. Part of the problem is how difficult it is to understand the civil justice system. It is a privilege for the legal profession to access legal aid – not a right. When we have a recession, civil legal aid is going to attract firms back in order to put more money into them. I am of the view that the first new practices in the civil justice sector will be among the sector and social enterprises. Young lawyers, and more radical lawyers want to work in a mixed economy.

IS: You can't expect civil legal aid to be a charity service provided by the lawyers. If it is going to be provided properly, it needs to be paid for. Having said that, in my opinion, the current legal aid system is hopelessly broken. We need more central provision and expansion of the current legal aid board provision where we have direct employment of solicitors working alongside voluntary agencies. We also need to look at alternative sources of funding. Voluntary organisations can get lottery money that we are cut out of because of the existence of the civil legal aid scheme.

JS: When I was the president of the Edinburgh Bar Association the Legal Aid Board said there were problems getting hold of somebody to take a case through civil legal aid in Edinburgh. If that is a problem in our capital city, it is a disgrace. It does need to be tackled, however we do it.

ME: Those of us on the civil side of legal aid look on with envy at the criminal side. We have to distinguish criminal and civil legal aid as there are a different set of issues for both. When I ran the Citizens' Advice Bureaux service in Scotland, we spent £2 million a year on everything, yet I feel that the impact on social justice was quite disproportionate. I look on with envy at the millions spent on legal aid.

What does the future hold for the profession in Scotland?

LU: I am an eternal optimist. I think there are huge challenges and you will see, what is euphemistically called a "consolidation" of the profession in the next few years because it will be difficult for some people to survive. But legal services are something that people need and provided we can adapt to what people need and want, rather than provide what we think they want, there is a bright future.

IS: We have a number of huge business advantages in Scotland. We speak English, we are part of the EU and new technology means you don't have to be physically close to centres of commerce to contribute. We also have environmental advantages – the quality of life, for all we moan about the weather – is superior to some other parts of the world. It's the job of the Law Society to create an environment that allows business to flourish.

JS: I am actually quite optimistic. Seeing some of the young people – either our own trainees, other people's trainees or those at school who expressed an interest in coming into the law – I remain optimistic, although I might not always say it.