New laws to boost transparency
Solicitors will have more onerous obligations to inform clients about costs when new legal services legislation is rolled out shortly. It is often difficult for consumers to get an accurate estimate for how much it could cost to bring a legal action.
Law firms and legal costs accountants can be reluctant to be pinned down to specific quotes as multiple factors can impact on the final bill, and not all of these can be accurately predicted.
One legal costs accountant explained to Review how in a personal injury case factors impacting on costs can include the amount of defendants, how bad the injury is, how many doctors are involved, how extensive discovery is, and whether it is settled early or goes to a full hearing.
However, under the Legal Services Regulation Act, even if the overall level of fees is uncertain, solicitors will have to list fees which are certain or likely to be incurred.
Solicitors will also have to provide clients involved in proceedings with an outline of the work to be done in each stage of the litigation process and the costs or likely costs involved, including the likely costs of engaging a barrister or expert witnesses.
The legislation increases obligations solicitors face under the existing Solicitors Acts and is aimed at allowing clients to make more informed choices and avoid being saddled with unexpected costs should they lose an action.
Similar enhanced obligations will apply to once-off legal services, such as buying a house or getting a grant of probate, where unexpected issues sometimes lead to additional fees being charged.
Another issue consumers have had to grapple with is that few solicitors advertise rates for specific legal services, so the only way to get an idea of the costs involved is often to make an appointment to get a quote.
The Law Society is trialling a ‘Get a Quote’ service on its website with 200 participating firms offering fee quotes for a small number of services — buying or selling a property, making a will or getting a grant of probate.
The society said law firms rarely engage in paid media advertising as it is not viewed as being cost effective. Research by Red C last year found 43pc of people picked a solicitor through word of mouth or a recommendation.
Research by the predecessor to the Competition and Consumer Protection Commission indicated it was well worth shopping around for legal services, with vast variations found in fees charged by solicitors for the same basic services.