Why are lawyers worried about probate rights for accountants?
As it is now less than a year until the non-legal big brands are permitted to begin their grab for high street legal services next October, those areas of work that are reserved (more or less) exclusively for solicitors are beginning to seem increasingly precious in the eyes of the profession.
It is no surprise, then, that the latest bid by an accountancy body to gain the right to license its members to apply for grants of probate is being met with a certain degree of unease by solicitors.
Indeed, research by the Institute of Chartered Accountants in England and Wales (ICAEW), the accountancy body in question, suggests that if accountants were able to exercise these rights, take up would actually be fairly high at the smaller end of the beancounters’ profession.
As Patricia Wass, chair of the Law Society’s private client section, told the Gazette last week, the concern for lawyers is not the fact that accountants may be able to perform this specialist area of work, but that they may become entitled to do so without undergoing the rigorous level of qualification achieved by solicitors.
She says: ‘We have long known that we will face competition from alternative business structures, and we know that we can’t stop non-lawyers making these applications.
‘What worries us is that we may not all be competing on a level playing field.
‘There are strict rules for solicitors who undertake probate work, and we want to be sure that new entrants to the market are governed by the same regulations.’
The Law Society had serious concerns over a previous application for a probate licence by the ICAEW, which it withdrew because at the time it would have meant that the body would have to contribute towards the Legal Services Board’s set-up costs. The Law Society claimed that that first application did not provide adequate consumer protection.
No doubt Chancery Lane will be scrutinising this second application just as closely when it is submitted. But ultimately the decision will rest with the LSB, which may be impressed by the potential benefit to accountancy clients of obtaining a seamless service without the need to instruct a solicitor.
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Comments
Hey! Check this link out
Hey!
Check this link out below. Can their application be speeded up?
I understand that the fees paid for correcting their f### ups come firstly from them and in any event the estate as a last resort? Cool. Bring it on as quickly as poss.
http://www.guardian.co.uk/money/2010/oct/13/tax-returns-accountants-inaccuracy
Accountants and Probate
Will Chancery Lane grow a set and prevent yet ANOTHER of our areas being handed out to all and sundry?
Oh grandma, what a big estate you've got!
Speaking as a specialist/exclusive Private Client solicitor, I wonder whether the public will flock to other providers in their droves (as some fear) for this type of "legal" work. It never truly transpired with licensed conveyancers or will writers (although I do receive work following the misunderstandings of the latter - but that topic has been covered elsewhere over the past 12 months).
What will soon become apparent is the level of "legal" training that will be required to understand the subtle complexities of estate administration, eg insolvent -v- insufficient estates; what is marshalling, and why is the date of death significant in so many different areas of probate practice?
New entrants would be better placed to recruit lawyers or establish ABS's rather than run the risk of negligence claims from a new and misunderstood area of work. Meanwhile, fellow solicitors would do well to review archaic working and charging practices. The days of reverence and loyalty, as we all well know, are largely long since passed.
This recession has seen unprecendented numbers of our profession retraining into Private Client law, so why should we believe that new providers will find it so difficult to train up to a similar standard? The next time I hear a Partner tell me that probate work is money for old rope and that anybody can do it will not be the last. And if those misconceptions exist within our ranks then there is no wonder that external providers see this as easy-money too.
Whilst we are willing to court business from accountants and take our CIOT exams we realise (or should realise!) when it is better to have the assistance of an accountant on the team. I pass more tax work to accountants than I deal with in-house. So why should we be fearful that accountants will be any different? Or are we simply scared because the majority run their firms on modern business practices and not on their laurels?
I will always use a solicitor for legal work and an accountant for my tax return. I recognise that each is a master of his own field and I suspect the public are just as savvy.
So how can we protect ourselves? Look at your own firm - what can you do to improve your service to clients? Get a good reputation, and work at it. In our profession, there will always be the wolves at the door.
What skills do accountants really have when it comes to probate?
I agree entirely with the last blogger. We should stop behaving like a bunch of hysterical piglets every time the possibility of a new competitor for legal work emerges. Let's face it legal profession has been pretty much protected from competition until recently and now, whether we like it or not, we are facing a harsh new business world where competition is expected and encouraged. Whether it is right or is wrong, more competition is inevitable. We need to adapt and deliver a better service rather than simply rely on the continuance of our monopoly in some areas. Anyway, what skills do accountants really have when it comes to probate? None. If the worst comes to the worst and they are going to take our probate work, in the foreseeable future that would mean that they will have to take on lawyers from existing solicitors firms -- which would not necessarily mean a reduction in the number of lawyers, just in the number of firms. Secondly there will be a slow shift in the public's appreciation that anyone apart from solicitors can actually handle probate. Thirdly a lot of high street accountants depend on getting good work from solicitors -- are they really going to want to bite the hand that feeds them?
Really
I am an eight year PQE Private Client Solicitor.
I think an accountant is slightly more qualified than a probate manager/probate executive/probate case handler/fee earner/paralegal (i.e in the majority of cases a secretary working without supervision and no formal legal training).
Welcome to the real World!!
Great News
Hopefully solicitors will see this as a wakeup call.
My own firm has been watching this story for a long time and are we now putting in place the resources so we are able to take advantage of any changes. We do the tax planning....give the advice....do the accounts and tax returns for a solicitor to apply for the grant of probate and charge a gigantic fee when we have done most of the work!
I'm confident within 24 months or so we will start to offer a seamless probate and wealth management service at a very competitive price. I'm also confident our clients will see the sense in keeping it all under one roof
Audit
Accounts
Tax
Financial Planning
Corporate Finance
Probate
Contentious probate will remain the preserve of the Magic Circle but for the majority of straightforward probate matters we intend to pounce!
The world is changing and the closed shops days are numbered.