The Law Society is to ask the Office of Fair Trading (OFT) to consider if the three law firms involved in Hambro Countrywide's in-house conveyancing service are acting in an anti-competitive manner by jointly offering a flat fee of £350.
The society said it was not reporting Eversheds, Shoosmith & Harrison and Middlesex firm EDC Lord & Co to the OFT, but was seeking clarification of the flat fee policy.
The three firms have forged regional agreements with Hambros to link up with its new in-house conveyancing service by covering one side of each transaction while the estate agents act for the other.
Richard Hegarty, chair of the Law Society's property and commercial services committee, said approaching the OFT was not an attempt to scupper the firms' arrangement with Hambros. “I don't want to have a go at them, I just want clarification,” said Hegarty.
He pointed out that if the OFT ruled that the behaviour of the three firms was not anti-competitive it could open the way for conveyancing firms banding together to agree on a set fee in proposed Solicitors' Property Centres.
The firms involved are adamant that they are not acting in an anti-competitive manner and are unhappy about the Law Society's move.
Shoosmiths & Harrison partner Andrew Tubbs said that as all three firms were striving to offer a high level of standardised service it was not surprising that a similar fee was on offer.
Eversheds partner Kevin Doolan said consumers had a free choice of who to use as their conveyancing solicitor in one of the most competitive market places in the UK.
“I think it will be a relatively easy question for the OFT to decide on,” he said.
EDC Lord senior partner Brent Urwin said he was disappointed the Law Society had not informed him of its plans.
Meanwhile, in a related move, the Department of Trade and Industry has warned solicitors that they could face dual regulation if the Law Society deregulates the rules surrounding solicitors property selling.
Around 67 per cent of the 791 solicitors who replied to a Law Society consultation paper on property selling called for de-regulation but the DTI has warned that if it goes ahead solicitors could lose their exemption from regulation under the Estate Agents Act.
The property and commercial services committee is due to recommend full deregulation of property selling rules at a council meeting on 17 July.
Deregulation would allow conveyancing firms or solicitors to act for the seller and the buyer as well as giving financial and mortgage advice.
However, the council will be unlikely to risk such a move considering the part conveyancing solicitors played in the creation of the £450m SIF shortfall.
It is likely it will opt for a compromise allowing solicitors to set up an estate agency separate from their firm that would be a multidisciplinary partnership, although a solicitor could not act for a buyer. The council may approve a number of firms joining together to sell property.