Conveyancers and the Draft Consumer Rights Bill

Conveyancers and the Draft Consumer Rights Bill

The existing framework of UK consumer law is contained within a significant number of pieces of legislation. Consequently, the UK Government believes that it would be better if these laws were consolidated and then simultaneously updated, in the areas of law which can be viewed as out of date, inconsistent, or confusing for consumers.

The Consumer Rights Bill was first introduced into Parliament in January 2014 and the latest version of the Bill was agreed on by the House of Lords in December 2014. The Bill should now pass between the Commons and Lords, until a final agreement on the reforms is made, with the aim of the bill coming into force later this year or early 2016. The plans should formulate the most radical overhaul for consumer law for a number of decades, as various pieces of fragmented legislation are streamlined into a single bill.

There a number of key amendments proposed within the Bill’s current drafting, and the following points provide a very general run down of the areas of law the Bill aims to consolidate and reform:

  • Consumer rights remedies in respect of goods, services and digital content
  • Unfair terms in consumer contract and notices
  • Enhanced consumer remedies that can be enforced by public enforcers
  • Enforcement powers of public enforcers
  • Consumer collective redress for anti-competitive behaviour 

Due to the scope of changes, the conveyancing market is unlikely to be immune from any alterations brought about by the Bill. For any professionals dealing in conveyancing, it is important they consider the potential changes this major piece of upcoming legislation could have on their practice area.

Although all potential impacts won’t be able to be assessed until after the finalised agreement and the legislation is firmly established into UK law, it is possible to make informed estimates on some prospective impacts.

Firstly within the draft Bill, there are two tiers of statutory remedy proposed with regard to services. Tier 1 requires those providing the service to either re-do the whole service or reform the element which is inadequate. Tier 2 allows the consumer to receive a reduction in charge, to cover the part of the service which has not been provided with reasonable care and skill. Consequently, an unhappy client may allege breach of terms to the statutory guarantee, as an alternative to going to the Ombudsman. At the very least, this change could provide an unhappy client with another complaints route to go down and as a result, the number of pursued complaints could be on the rise.

Secondly, the Bill mirrors existing legislation that a service must be performed with reasonable care and skill. It also introduces new implied terms that a consumer must be obliged to pay a reasonable price, and the services must be performed within a reasonable time, unless the time or price are fixed in advance. With regards to ‘reasonable price’ it is unclear what the price would be for conveyancing and it will be interesting to see if the court’s decision would be lower or higher than what most conveyancers charge for their work.

‘Reasonable time’ leads to a more complex issue because it is well established that buyers frequently underestimate the time taken to complete the conveyancing transaction. Furthermore, if the time delay was because of lenders, search providers, or another solicitors firm, will clients believe their solicitors to be liable for another party’s delay? It may become vital that client care agreements contain express terms on the price and timing of the transaction to avoid any possible ramification of a drawn out transaction.

Finally, it is viewed that all written terms offered to a consumer must be ‘transparent’, meaning they must be legible and in plain intelligible language. Therefore, if there is any ambiguity in a term or condition, it will be construed in the client’s favour. It appears there will be no allowance on hidden terms and all fees must be apparent if a fixed quote is given for the transaction.

In summary, it would be wise for solicitors and conveyancers to review their terms and conditions in preparation for these upcoming changes, and become familiar with the changes due to the potential impact they could have on their practice.

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