Co-op’s LSA gambit casts pall on Pannone alliance

The future of Pannone’s longstanding relationship with the Co-operative is in doubt as the mutual retailer prepares to ramp up its legal services division later this year.

Eddie Ryan
Eddie Ryan

The Co-op is planning to grow significantly the size of its in-house division, Co-operative Legal Services, after the introduction of the Legal Services Act.

This is expected to see it take the personal injury (PI) services it currently farms out to Pannone in-house. While the work is thought to currently be worth around £1m a year, the Co-op plans to expand this.

The Co-op already ­handles PI in-house for its millions of members, but after October it will be free to offer these services to the wider market.

Pannone is currently ­listed on the Co-op’s ­website as its sole provider of PI services other than those claims relating to road ­traffic accidents.

“Once the Co-op can be an alternative business structure [ABS], why would they outsource it?” said ­Russell Jones & Walker (RJW) marketing director Andy Hoe. “After 6 October it could rip up any agreements it has with the firms it works with and employ its own lawyers.”

Co-op Legal Services managing director Eddie Ryan confirmed that his company’s strategy had always been to extend the range of services it offered.

“We’ve dealt with ­Pannone for about five years and we’ll probably always require someone to handle conflicts of interest work,” Ryan said. “We’ll probably continue to have a relationship with them.”

Pannone partner Andrew Morton claimed “virtually everything” the Co-op does is already handled in-house.

“Our role’s always been to help them with conflicts,” he added. “That won’t change.”