Last Wednesday I sat in the ball room of the Waldorf Hotel to listen to the launch of the new Transaction Conveyancing Quality Scheme (TCQS). Take it seriously, it may impact on your position on lenders panels, your insurance and your reputation in the market. If you aren’t on the scheme by next spring your job as a conveyancer may face a lot of practical challenges. Yes its going to cost you something but demonstrating quality is important. This may be your last chance not to be swept away.
On the day I was cynical about the scheme but afterwards I became more supportive and I decided to wait and see what the press said before I wrote a piece here. I now hope that the scheme will get the support it deserves though I suspect it may fail due to lack of interest or commercial pressure. Based on the size of the audience and few short paragraphs in the legal press since I suspect I am right but hope I am wrong. According to the delegate list about 130 delegates managed to attend from approximately 9500 firms of solicitors. It is a great shame that the outstanding majority of the profession remain apathetic at a time when solicitors are being criticised by lenders and insurers alike and face the potential of external competition from Alternative Business Structures.
If solicitors are not able to demonstrate that they can put their house in order other organisations like lenders or insurers will do it for them.
To emphasis the risk to solicitors Paul Marsh past president of the Law Society said “we are in the perfect storm, our brand is badly damaged with two important stakeholders the lender and the qualifying insurers”. A poor economy, some fraud within the legal practice, increased negligence claims, losses being encountered across the financial services sector, the Legal Services Act and years of apathy have left solicitor doing conveyancing being pressured from every side.
Linda Lee the Law Society president set out the need for the scheme explaining a need to rebuild trust with lenders and insurers, a desire to improve the conveyancing process to make it more efficient in the future and to promote the brand of solicitors to the public.
In what appeared to be a sub plot for the day Linda Lee said “it’s our market and we want to keep hold of our market”. Michael Coogan the Director General of the CML reflected this later in the day by stating that lenders would reserve the right to create their own scheme.
The scheme will start in spring 2011. Prior to that date firms will be invited to complete an application form and pay an application fee of between £176 up to over £1000 depending on your number of partners. If a firm is considered to meet the scheme criteria and becomes accredited a further membership fee of between £235 and £1175 is payable. Sole practitioners will pay the least with an average firm of between 5 and 10 partners paying £470. The figures quoted include VAT and they will therefore go up when the VAT rate increases to 20%.
Practitioners will receive a certificate and window stickers. You will be able to check if other firms are part of the scheme via an online check.
For some firms the scheme will bring with it some new burdens such as the requirement to demonstrate that you have “vetted and identified key conveyancing staff in your firm”. There was talk about the need to issue all staff in a firm with a photo identification card to prove who they are. Each firm will have to appoint a Senior Responsible Officer who will have to undergo mandatory training with non lexcel practices being required to attend practice management courses.
Firms will be visited on the basis of a risk analysis.
The scheme is based on four objectives, those of probity, practice quality standards, client/stakeholder services and quality assurance. The idea is to “enhance the reputation of conveyancing solicitors”, to “provide reassurance about integrity and practice standards”, “to create a trusted conveyancing community that will deter fraud” and to “provide a more effective service for clients”.
The scheme will amend the protocol procedures and have its own redress process for those solicitors that wish to complain about other solicitor members.
Paul Marsh talked darkly about a period of “considerable competition” for conveyancers and how important it was for solicitors to create a “trusted community” that stakeholders could trust. He indicated that the sector had been hit hard by organised crime and that this was a three stage process i) stabilise the position regarding fraud ii) build up the defences, iii) push back. Paul held the view that in recent months the Law Society had been stabilising the situation and this scheme was part of the defence building.
In a supportive but robust reponse Michael Coogan said the CML supported the scheme but said “it is your only hope that solicitors pre-eminence in the conveyancing world continues” He went on to warn that solicitors could no longer “dabble with immunity”.
Earlier that day the audience had voted on various questions and whilst 83% of the audience wanted a quality scheme only 75% wanted a robust scheme. Michael Coogan clearly stated that if the scheme was not robust and did not protect lenders then lenders would do something for themselves.
Later Edward Goldsmith, Chairman of The Conveyancing Association said “The Conveyancing Association is fully supportive of the objectives behind the Law Society’s Conveyancing Quality Scheme (CQS) as it is a goal held by all to raise and maintain standards and engender better transparency. We are very keen to work with the Law Society in any way we can to promote these objectives and will be looking at the CQS as part of the overall picture with our members in helping to increase professionalism and raise standards in residential conveyancing”.
On my way home I bumped into an old colleague who had been at the Royal Institute of Chartered Surveyors who appear to be having very similar issues. At their meeting they relaunched their Red Book and affirmed their commitment to quality. Lenders and insurers are putting surveyors under the same pressures we face.
Don’t dismiss this out of hand as dabbling at the edges. The authors of this scheme are trying to resolve the problems that the sector has and they should be supported along with any other scheme for any other professional in the conveyancing market. It may not be a perfect solution yet but it is a good start and merits support.
For further information see the Law Society web site.
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