Quantifying the fee issue

It is with dismay but no surprise that I learn of the threatened referral by the Office of Fair Trading (OFT) of the Standard Mortgage instructions to the Restrictive Trade Practices Court.

While the scramble for cover by the establishment is perhaps inevitable, it is time that the views so vigorously opined by the regulators are tested, as the judiciary has rarely, if ever, been given the opportunity to examine the issues in depth.

The mischief is apparently the presentation of indicative fees for conveyancing which will either be too inhibiting to the public or suggestive of price fixing at rates higher than the open market would dictate.

May I draw attention to the Publicity Code Amendment (No.2) Provision of 1995 which from January 1996 prescribed: "It is a breach if publicity includes an estimated fee at an unrealistically low level if the solicitor then charges higher or additional fees."

Under paragraph 1 (c) publicity should not be inaccurate or misleading "in any way". So fees indicative of a lower than realistic charge might be outlawed if in reality the "cut-price merchants" are shown to render fees in excess of estimates.

I question what, if any, steps have been taken to establish what is, in quantified terms measured against a financial benchmark, a "reasonable fee".

Further, might I ask what research has been carried out into completed cases in order to ascertain what percentage of business carried out by "low fee" firms has indeed been completed within the promised fee?

If no complaint is made by a client, how is this piece of virtuous self-regulation ever to be seen to be working in practice?

The Legal Ombudsman is not the only one who is sceptical of our ability to regulate ourselves properly.



M D Garson

Solicitors' Property Group .