Legal Services Consumer Panel calls for increase in Legal Ombudsman’s compensation limit

The Legal Service Consumer Panel has issued its response to the Legal Ombudsman Consultation on its scheme rules and case fee structure.  
The Panel believes that the package of proposals being consulted on would help close redress gaps for consumers.  The number of prospective customer complaints would be likely to increase as the jurisdiction of the Legal Ombudsman widens.  The jurisdiction would cover claims management companies and will-writers.
As third party complaints would be heard by the Legal Ombudsman this would extend the routes that are available for redress.  The Panel does not believe that all third parties should be given the right to complain, but argues that third party complaints should be allowed except for specific types of cases.  The definition of ‘consumer’ in the Legal Services Act could be used to define third party complainants.
The Panel believes that the proposed change regarding time limits for complaints is a good idea.  The proposal is that the time limits will be extended so that complaints can be accepted up to six years from the event, or three years from the knowledge of the event.  It argues that longer timescales are needed to reflect the lack of expertise of the consumer, but also believes that the time limits should be reset after someone dies, as a longer period to complain is appropriate to take account of the bereavement.  
The proposals to increase the compensation limit are welcomed by the Panel, who argue that raising the limit to £50,000 is not enough.  It suggests that LeO should be brought in line with the Financial Ombudsman.  This would take the limit for compensation up to £150,000.
The Panel argues that the case fee structure should remain as it is, reflecting the stakeholder consensus that the ‘polluter pays’.  It also supports the proposal to remove the ‘free’ case element as the waiver system already provides appropriate flexibility.  
The final point that the Panel makes is that the current scheme rules are confusing and that a plain language version of its scheme rules to aid consumers.  
The consultation by the Legal Ombudsman has been running for twelve weeks, and closes on 18 June 2012.      
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