Differences between regulated and unregulated legal service providers.
One of my fundamental principles is to be straightforward and transparent with clients. Following this approach, I believe that any client / potential client has a clear interest in understanding, and making informed choices about, their legal service provider. That includes any differences or limitations in the protections and redress options available to them. I set out below some of the key differences between regulated and unregulated firms; how SLL has addressed those issues; and how they may impact the service that SLL delivers.
1. SRA oversight/regulation
It perhaps goes without saying but the obvious difference between the two models is that unregulated businesses are not regulated by the SRA (or other regulator(s)) and do not have to comply with certain SRA rules in running their business.
SLL is not bound by the Code of Conduct for Firms and I am not bound personally by the SRA Code of Conduct for Solicitors, RELs and RFLs (because I am currently a non-practising solicitor – see further below). Nonetheless, having worked at regulated firms for many years, I am fully aware of the standards set by the SRA and I strive to uphold those standards when delivering services to clients.
2. Insurance
Regulated law firms must obtain something called ‘SRA minimum terms insurance’ cover for professional indemnity (in case a mistake is made when providing the legal services). This cover is extensive and consequently very expensive. Details of the insurance can be found here.
There is no obligation for an unregulated business to take out this insurance; however for the protection of SLL and its clients, SLL has secured industry-standard professional indemnity cover with a reputable insurer which has an indemnity limit of £1,000,000 (1 million) per event. Copies of insurance documents and further details are available on request.
Whilst there may be some differences between these products, for the purposes of the work that SLL undertakes SLL does not anticipate there will be any material difference in the cover available to clients in the vast majority of cases.
3. SRA Compensation Fund
For unregulated services you will not be able to make a claim on the SRA Compensation Fund. This is in essence a discretionary fund made up of annual payments by everyone the SRA regulates. Payments from the Fund can be made where money has been stolen or not been accounted for by someone they regulate, or where a regulated person/firm did not have insurance in place to cover a claim.
It of course goes without saying that SLL will not steal your money! In any event, considering that SLL does not hold funds in escrow for clients in any transactional matters, this is not a pertinent risk to our clients. The only money transferred to SLL will be for fees and expenses payable by you.
The insurance position is addressed in more detail above.
4. Legal Ombudsman
For regulated service providers, if you are dissatisfied with their services and the firm has not satisfactorily resolved your complaint, you have the right to bring a complaint to the Legal Ombudsman. If the Ombudsman decides to uphold a complaint it has the power to direct service providers to pay compensation when evidence shows it is required. It can also direct that work is re-done or completed, or that no action is needed.
For unregulated firms you are unable to refer the matter to the Legal Ombudsman. However, SLL has a robust complaints policy in place in the unlikely event that you are dissatisfied with your service. If your complaint can’t be resolved you are still able to refer the matter to any organisations that address complaints against unregulated service providers. Further, you still have the right to bring a legal claim and ask the court to determine the matter, should you wish.
5. Practising v non-practising solicitors
Although I qualified formally in 2014 and worked as a practising solicitor for many years following that, I am currently a non-practising solicitor.
This means I don’t currently hold a practising certificate. A practising certificate is issued to solicitors to allow them to (amongst other things) undertake reserved legal activities [I explain this in more detail on the Website’s ‘About’ page]. As SLL only undertakes non-reserved legal activities, a practising certificate is not required for the work I do.
For the avoidance of doubt there are no prohibitions on renewing my practising certificate if at any point I wished to - for example to go back into private practice. However, at that stage I would be subject to full SRA regulation once again. My SRA number is 507009 and you can review my complete practising status on the SRA’s website here.
Although I am not bound by the SRA Code of Conduct for Solicitors, RELs and RFLs, I am bound by the SRA Principles at all times.