• Strong public interest case exists for new approach to reserved legal activities, says LSI

  • 10 February 2011

  • The Legal Services Institute (LSI), a legal think tank, proposes that there is a strong public interest argument for will-writing and immigration services to be added to the list of reserved legal activities in the Legal Services Act 2007.

    In a groundbreaking paper published today, it also suggests that the current reservation of probate activities might be replaced with a broader version covering the administration of estates, and the property-related reserved instrument reservation might be widened to include all conveyancing services.

    However the LSI, a policy think tank funded by The College of Law as part of its charitable foundation, says that there is insufficient justification for adding insolvency practice or claims management services to the list of reserved activities.

    It also contends that the authority to practise a reserved activity should not be confined to those who are legally qualified but should instead be conferred separately by accreditation and, for lawyers, through an endorsement to a practising certificate.

    The paper titled ‘The Regulation of Legal Services: What Is The Case For Reservation?’ examines the public interest rationale for the reservation and regulation of legal activities with the aim of suggesting a contemporary approach. It takes as its starting point the LSI’s previous conclusion that there is no apparent policy rationale to justify the way that legal activities are currently reserved.

    Reserved legal activities can only be carried out by appropriately authorised persons and presently comprise: the exercise of a right of audience; the conduct of litigation; reserved instrument activities; probate activities; notarial activities; and the administration of oaths.

    The director of the LSI, Professor Stephen Mayson, who co-authored the paper with LSI policy assistant Olivia Marley, said: “I did not expect our review to lead us to some of our conclusions.  If anything, I suspected that we would propose that there should be fewer reserved activities.

    “However if the reserved activities are anachronistic or lacking an articulated public interest justification - which we believe they currently are - there is a significant risk that the Legal Services Act 2007 will have promoted (and the Legal Services Board will be overseeing) an increasingly irrelevant regulatory infrastructure that does not secure sufficient public benefit or consumer protection."

    Today’s paper is the LSI’s second to look at reserved legal activities. The first, published in August 2010, traced the origins of the six reserved activities and examined the historical reasons why each of these was selected for reservation.

    It concluded that there were few apparent historical policy reasons for originally defining these activities as reserved and that the reserved activity structure appeared to be built on “tenuous foundations”. This, it argued, resulted in a lack of sound criteria on which the Legal Services Board (LSB) could base future recommendations for adding or removing activities from the list.

    Prof Mayson said: “As things currently stand the regulation of legal activities is somewhat confusing and surprising for consumers. It would seem illogical to consider the creation or removal of reserved activities without reviewing the broader approach to the regulation of activities, individuals and entities.

    “As a result of our first paper, we were not convinced that there is yet a coherent public interest argument that applies to the current reservations, or even a cogent set of arguments that forms a reasoned basis for their continuation.  We believe that this second paper provides that public interest argument.”

    The new paper examines those legal activities for which a strong public interest case could be made that they should be reserved and proposes a definition of ‘the public interest’.  It also suggests that, despite ministerial unwillingness to do so as the Legal Services Bill passed through Parliament, the regulatory objectives which are core to the 2007 Act should be split into primary and subordinate objectives in order to resolve conflicts among them.

    The LSI’s first paper also identified a ‘regulatory gap’ as a result of which some legal activities are neither reserved nor regulated and can be carried out by unregulated individuals without any regulatory oversight.

    “Activities that fall into this gap include some that could potentially seriously affect the lives of the people involved and of others around them, such as the preparation of wills, or advice about mental health,” said Prof Mayson.

    “There is some risk that consumers might not be adequately – or even competently – advised on issues that are fundamental to their physical, mental, personal, social and economic well-being. We do not regard this as being in the public interest.

    The LSI was established by The College of Law in 2006. Its principal objectives include seeking a more efficient and competitive marketplace for legal services, contributing to policy formation, and encouraging better-informed planning in legal services.

    It is now inviting comments on its latest reserved activities paper and intends to publish a final version by the end of April. It is available on the LSI’s website at www.legalservicesinstitute.org.uk Comments can be sent to lsi@lawcol.co.uk

    Further information from Lucy Wray, Press Officer, The College of Law on 01483 216072 (lucy.wray@lawcol.co.uk)