Conveyancing revolution hits the high street
13 October 1998
Estate Agent Hambro Countrywide is tactful enough not to say it was as easy as taking candy from the proverbial baby.
But in setting up Hambro Countrywide Conveyancing (HCC), Hambro met about as much opposition from the profession as the All Blacks get from the Welsh rugby team.
"If you look at the profession, it is a highly fragmented one," says Hambro's new business development manager Richard Sawtell.
"Certainly we did think when we went into this that it would be hard for lawyers to construct a co-ordinated response to what we were doing. They couldn't afford to invest in the technology and the training. They were in a downward fee spiral."
But HCC had its own problems setting up a service. It linked up with law firms Shoosmiths & Harrison, Eversheds, and Middlesex firm EDC Lord & Co in March of 1997, but it was a year before they had anything to show for their £1.7m investment.
HCC managing director Bob Scarf admits that the operation had teething problems, but is vague about their exact nature. "Lawyers are lawyers first and businessmen second," he says. So was a lack of business acumen from lawyers holding back the HCC operation in 1997? "You may say that. I couldn't possibly comment," is his response.
However, as The Lawyer revealed last week, HCC has taken 15,000 instructions in the last nine months - making it England and Wales' largest conveyancing operation.
In a soulless office block in Brentwood, Essex - one of HCC's five conveyancing centres - employee Tony Church shows off the system that is attracting customers.
All Hambro customers buying or selling a house are offered the conveyancing service. If both parties in the transaction agree, then HCC acts for one party and a volume conveyancer (such as Eversheds) acts for the other. This is known as the fast track system - but HCC will work with a high street firm if the client on the other side insists on it.
HCC clients can call seven days a week to find out what is happening to their transaction, which can be brought up on screen by any member of staff. HCC says clients can also come in and talk to them, although the Brentwood office is clearly not designed for this.
An Ilford solicitor before joining HCC, Church says the "fail-safe" conveyancing computer system is based on a series of prompts that staff have to carry out before going onto the next task. "The whole system is designed to be pro-active," he says. "The benefits sell themselves."
Church says he gets fewer client questions about the conveyancing process at HCC compared to private practice. He finds the job more enjoyable as there is not the associated pressure of running a firm.
One client, whom The Lawyer sought out independently of HCC, said his service seemed "very efficient" and offered "lots of helpful information".
"We were impressed by their 'no deal, no fee' offer," said the client, who asked to remain nameless.
At £350 plus vat, HCC says the aim is to compete on service, not to undercut the competition. But all lawyers who join HCC have to suspend their practice certificate and become licensed conveyancers. That means HCC does not have the burden of the Solicitors' Indemnity Fund (SIF) on its back - although it does have indemnity insurance.
"Licensed conveyancers are equally well-qualified to offer a proficient service to the public as a solicitor," maintains Sawtell. However, the majority of staff are paralegals.
In fact, one of the main difficulties constraining growth, according to Scarf, is finding "top quality" lawyers to join HCC.
Hambro is looking for people with a mix of conveyancing and commercial experience, who have worked with the public and "can work in teams".
Meanwhile organisations like the Halifax, weary of four years of fruitless negotiations with the Law Society to establish Standard Mortgage Instructions, have made it clear to The Lawyer that similar "conveyancing factories" are on their agenda.
HCC's entry into the market has not necessarily had a huge impact on the high street yet. But Hambro claims that by1999 it will be handling 30,000 instructions - a figure that does not account for rival operations which may be up and running by then.
So who will oppose HCC? The profession as a whole? Forget it. City firms will be doing handstands if high-risk conveyancing falls out of the hands of the profession, thereby easing their SIF bills.
The Law Society? Sawtell for one believes its role as both regulator and trade union makes it hard for Chancery Lane to put up effective opposition.
As for the lawyers, despite holding more conferences in the last two years than Tories have held in the last 100, ideas for a nationwide chain of solicitors' nationwide property centres have failed to materialise.
Against this background, it is tempting to write off the high street conveyancer as an endangered species. But Surrey firm Downs says any announcement of the high street conveyancer's demise is premature (see letters, page 16). In the past year it has invested heavily in its own computer systems and now operates a seven-day, 24-hour, conveyancing service which partner Christopher Elias says operates at a profit - something HCC is yet to achieve.
Another example of high street success comes from Kent, where estate agent Ward & Co has teamed up with several local law firms to offer a telephone conveyancing system along similar lines to the one operated by Hambro.
Even HCC's Scarf admits that while there will be a "shake-out" of weaker lawyers in the market, there will always be people who want to go to a solicitor for their conveyancing.
But both Scarf and Elias agree that a great many solicitors will be ill-prepared to operate in this new era of high-speed, telephone-based, IT-intensive conveyancing.
The conveyancing revolution appears to be in full swing.