Law Society to protest at Santander’s 'panel cull'

I could not agree more with the comment by anon 27/07/2012

He/she hits the nail bang on the head!

As a firm we have no interest in conveyancing but when I read this article I had, as the young of today might say, a "LOL" moment.

Talk about closing the stable door after the horse has bolted. Institutional lenders have historically treated solicitors as their whipping boys. The Law Society has stood by while banks and building societies,staffed for the most part with inarticulate, semi literate individuals with no proper understanding of the functions solicitors discharge and who leave you with an impression they can barely dress in the mornings without the guidance of their line manager (with who you can never speak) shift every risk known to man,onto us on the basis that the cost incurred in dealing with the relevant issues "will be met by the borrower".

I am told HSBC now tell their borrowers "use on of our 40 something firms at the "price fixed" cost of £x or use your own solicitor but pay us £192 for the privilege of having a choice"

Of course at least that maintains quality..............because as part of the tender process those bidding must ensure each individual who undertakes the work passes some form of conveyancing examination...............yeah right! I know at least one firm who sub contract's the work to India

I suspect that irrespective of the degree of vigour with which concerns are raised they won't change their minds.

I think that, sooner or later, the Society is going to have to bite the bullet and accept that separate representation is the answer to a lot of problems. Messing around with schemes like CQS is clearly not the answer. It simply annoys solicitors, in that they are having to pay the Society for something which guarantees them nothing. In any event, CQS will lose its credibility (if it has any) as soon as there are a few reported judgments in successful negligence claims against CQS members. If lenders really are concerned about avoiding mortgage fraud, and the Society really is concerned about protecting its members' interests, separate representation is the obvious answer.

The practice of requiring solicitors to pay to have their position on a panel reviewed is something which should obviously be outlawed.

wot Anon sed - but in a cleverer way

I wrote a letter to the Gazette a while ago - any they altered it to make it sound that I was not anti the CQS. Quality systems do not improve quality. They just add time and costs.

We deal with CQS firms - manyy still use the same slightly trained non qualified entities to do the work.

It's about time the Law Society grew a spine and stood up for the solicitors instead of continually promoting their own selfish interests.

I agree with the views already posted.
Frankly the Law Society, our "so called" representative body is an absolute disgrace! They have introduced the CQS which we all know is designed to reduce the number of firms dealing with property matters. How arrogant and pompous are the Law Society when they are completely out of touch with the reality of the small High Street firm. The committee members are from larger firms who have no idea what life is like in the real world, and they WANT to put the smaller firms out of business.
I for one, and almost every solicitor I have discussed CQS with, am totally opposed to what our so called representative body are forcing on us. Many of my colleagues have expressed a willingness to protest against the Law Society and I would certainly agree to that. It is ONLY when the Law Society is embarrassed by bad publicity will they come out of their posh committee rooms and actually start work for us, their MEMBERS!
Representative body??????????
No, simply a DISGRACE!!!!!!!!!!!!!

Can't say I didn't see this coming. Law Society fight on firms behalf? Do me a favour - they have sold out to the the Lenders, CML & Insurers a long time ago. CQS? Yeah it will guarantee quality and the Lenders/CML want it. Along come Santander today who have made a nice little tickle from firms seeking to get back on their conveyancing panel and having done this we'll go on the numbers ratio to remove firms again (with or without CQS,Lexcel etc). A bit more bluster from the Law Society but what we need in Chancery lane are people who will fight for all solicitors across the board and this is not happening at the moment. Bitter Moi?

I also agree with everything which has been said. It has been clear to me for some time that the real intention of the Lenders is to ultimately have on their panels only those firms which are prepared, or even required, to pay referral and administration fees to them. It's just another way of taking money from hard-pressed practitioners who have no choice but to comply in order to preserve their livelihoods and, indirectly, the unknowing public. But hey, what else do you expect from the robber barons who helped bring the economy to its knees and have to replace all that money they're having to pay out in compensation claims for misselling.

As for CQS everyone knows that this is not going to be the answer. If every firm attained it then the Lenders will still find ways of culling them. Also I am still wondering how the Law Society can promote a scheme in which applicants do not have to show that they are actually competent to do the work, properly advise clients and have a good knowledge of the relevant law. I am presently dealing with a sale involving an unregistered title which is not straightforward but not particularly demanding. The Buyer changed solicitors because those initially instructed were not on the Lender's panel. The new solicitors are CQS accredited and one of the "high volume" outfits with whom we are all familiar yet they have not got a clue as to how to deal with my client's title.

Separate representation in all cases is not in anyone's best interest including the Lenders, but the alternative of conveyaning being undertaken by a few nationwide factory firms paying referral fees to Lenders is much worse and unless something is done then in 5-10 years time that is going to be the norm. Unfortunately we also know that the Law Society is going to carry on in the same manner that its done over the last few years - protest, have meetings, make a few representations and ask practitioners to keep stumping up the cash to keep CQS going. And guess what we will soon need to do it all again in order to write wills!

Our client offers to buy a property marketed by a CWPL Estate Agent. CWPL offer to provide the conveyancing service, but the client has already spoken with me. The seller is already committed to CWPL conveyancing. CWPL surveyor is recommended to my client by the Estate Agent and instructed. We did not receive the contract documents because CWPL sent those to the wrong solicitors. It wasn't until we chased and got them by email when we noted the error they had made. CWPL Surveyor now advises our client the house value is 1500 less than the agreed price.

Do CWPL now what a conflict of interest is?

If this is their quality service, what a fine mess for a non CQS solicitor to sort out.

I have just read that Lloyds Banking Group says that its best estimate of thecost of misselling PPI policies is £4.275 billion. And they are telling us that we are fraudsters. As far as I can tell, CQS is not going to make an honest solicitor out of a dishonest one. All it will do is to ensure that the dishonest solicitor has proper procedures in place. What is the point?

Not necessarily totally relevant to the original post but it has been mentioned in various guises through the following posts - mis-selling of insurance??? How many of us out there (small firms especially) are lumbered with purchasing each year £2m worth of Indemnity insurance when our largest transaction is less than half of that? Is that not misselling as we do not in fact need that amount? Why do the Law Society insist this is minimum cover? Despite having one claim in the last five years our premium has trebled in cost and we are faced each year with having to negotiate hard to keep this down and keep ourselves in business????/

Mis-selling.....?

I am one of the solicitors who has been arbitrarily advised that my firm has been removed, having paid the fee to Santander earlier this year.

I have appealed against the decision, and requested to know what criteria Santander have applied. Whatever that may prove to be, I suspect that it will be of no avail, having made representations to Lloyds TSB on their similar decision some 2 years ago.

I acted for Santander, Lloyds, TSB, Cheltenham & Gloucester, Halifax, etc. for more than 25 years without complaint, and this appears to count for nothing ......... in a time of very few instructions, it is now very doubtful that I will be able to carry on in practice.

Sue

I agree with the comments about separate representation.
I have believed for a long time that separate representation would be the only way forward for the high street practitioner. The cynical attitude of the Lenders, able to dictate terms to the profession, coupled with the unhealthy practice of referral fees to agents or payments to Lenders for panel membership, made me realise this ages ago. The first letter I received from a Lender saying my firm had been removed because we had not completed the requisite number of matters (without saying what number was requisite) was early in the recession. I was rendered speechless that a Lender could even think of using that as a reason for removal given the property market at the time, and clearly there was an ulterior motive.
However, whenever the subject is mooted, for example in a letter to the LSG, there is a deathly silence from the Law Society. I remember when I first practised there were many Lenders with their own panels, and it seemed good news at the time when the panels were widened. Things worked well for many years after that. However, with the high street practitioner now at the mercy of the commercial arrangements of the lenders, we should fight to protect ourselves. Of course we are motivated by self interest, we need to survive and make a living, but that is nothing to be ashamed of, we cannot believe,surely, that the Lenders are not motivated by self interest.
If they take the view that all firms should not be on their panels, or have any other reason for culling, then let us have a rule on separate representation. We can then continue to represent our Clients who want to use us and are distressed by the pressure brought to bear on them by Agents, or who are told that because we are not on a particular panel they should look elsewhere. The Law Society would then be seen to act in the interests of firms across the board, and needn't waste time and resources in futile discussions with Lenders.

Having read and now partially summarised for Bold Legal Group (BLG) members the 204 page Legal Services Benchmarking Report (June 2012) it becomes even more baffling as to why so many lenders are taking the actions they are. Part 14 of the report, The Conveyancing Journey paints a very positive picture of the service provided by most solicitors/conveyancers. Why is it that the majority of individual clients are happy but lenders are not?

As far as Sep Rep is concerned we (the BLG) carried out our own survey a few months ago. Over 80% of respondents thought Sep Rep was the only answer to the lender cull now taking place. As a result I, with others, have started work developing a Sep Rep process that will be as quick, efficient and as cost effective as is possible. Once developed that process will sit on a shelf until, and if, needed. If it is not needed and it is time and effort wasted then so be it. However, what I will not do is sit back and wait for more and more firms to be taken off panels and have no plan B in place.

If you are interested email rh@boldlegal.co.uk

The Lenders will continue to do as they like and clearly see nothing wrong in getting into bed with the large firms of conveyancers like Countrywide which are essentially the conveyancing arm of their estate agency, surveying and financial services businesses. Consequently they can refer large amounts of business to the lenders and until such time as they have put everyone else out of business can offer fees which represent something of a loss leader.

The other parts of the transaction subsidise the conveyancing and we can assume that when the competition is destroyed conveyancing costs will go up. The quickest way to put other out of business is by limited panels. Those not on them will end up reducing their fees to cover the lenders conveyancers cost but have double the work. That is not a viable proposition and work that is not desperately profitable will become loss making.

The lenders know exactly what they are doing and the excuse of fraud can be taken with a pinch of salt from institutions which have wrongly sold practically every financial product you can think of, criminally laundered drug money and dishonestly fixed the Libor rates.

And yet the government seems quite happy for these people to effectively control the whole house-buying process without buyers in the future,having little prospect of receiving any sort of truly independent advice.

As Rob Hailstone points out The Legal Services Benchmarking report shows a high level of satisfaction with conveyancing practitioners and the prices charged. That needless to say counts for nothing with lenders who are only interested in money and bonuses.

What we need is a Law Society who truly fight for the members interests rather than invent useless quality assurance schemes whose primary purpose seems to be to provide income for the Law Society and guarantee the jobs of those employed by it. These schemes just give others a stick with which to beat us and very dangerously implies that after spending five years qualifying a solicitor needs a further qualifications to do conveyancing and if the Law Society gets its way to draft a will. This begs the question as to what has gone wrong with legal training.

Surely the Law Society should be addressing their minds to that question rather than erecting yet more hurdles for hard pressed practitioners to jump over.

Frankly we need people in the Law Society like Rob Hailstone, prepared to take the gloves off to fight for our profession which in the case of conveyancing surely means for separate reputation. After 40 years in the profession I feel we are facing our most dangerous time. Frankly we now hang together as if we do not we will most assuredly hang separately.

Rob, I think you have valid points, and it is good to see somebody challenging the status quo.

But small businesses - many of whom are struggling in the present economic circumstances - don't necessarily see the answer as being to join a marketing and referral network, and pay a fee to yourself. This may well be shortsighted, but we are already members of an organisation - The Law Society - which we are obliged to pay for.

And I personally do not see the HSBC outcome as being a victory in any way whatsoever. All that has been acheived is that firms need to join CQS at a cost of several hundred pounds, and can then be told what to do by the administrators working for Countrywide Conveyancing. And even then, the membership of the panel is arbitrary - sole practitioners can't act for over £150k and as Santander has shown this can be (and invariably will be) changed at any time.

The anger, resentment and frustration on this subject is increasing on a daily basis and will get worse. This blog is becoming more heated and reading like the tabloid press. I would like to know from the Law Society the answer to a simple straightforward question, the answer to be given in clear and simple language we can all understand including reasoning, why they WILL NOT ban the same solicitor acting in the purchase and mortgage work insisting there MUST be separate representation. This surely must be the ONLY sensible solution at minimal cost..

It's worth looking at the CML's position on separate representation:

http://www.cml.org.uk/cml/publications/newsandviews/117/438

and the position of the Law Society of Scotland:

http://www.lawscot.org.uk/members/member-services/professional-practice/professional-practice-updates

If the Law Society of Scotland thinks the issue sufficiently important to justifying establishing a working party to examine it, our Law Society should surely do the same. Surely, that is what solicitors should be pressing to Society to do.

Lenders would no doubt be against universal separate representation (as the CML document suggests), but their protestations would not be convincing. If their agenda really is to reduce fraud (or the risk of fraud), one of the best steps towards achieving that is to have the lender and the borrower represented by different lawyers.

One possible solsution would be to stop solicitors holding money in a client account.

This would remove the alleged (though fictitious) concerns about fraud `at a stroke', and with modern banking systems in place it should be possible to effect transfers of funds in connection with conveyancing at least as efficiently (i.e. not very!) as the present system.

In some ways it would actually be an improvement, as it would prevent the waste of time in a bank sending money to us only for us to send most of it back to the same bank (quite possible these days with so few independent banks left in existence). It would also enable funds to be transferred more quickly to clients, who would thereby benefit.

Although at first glance the loss of the right to hold client funds might seem to be a major disadvantage I'm not sure it would make any great practical difference - and think of the saving on accountant's fees and PI premiums!

There seem to be enough conveyancers who are disgusted with Santander, Lloyds Banking Group, Nationwide and the others (including their subsidiaries and offshoots) that we should be ones calling the tune, not the lenders.
You could all start off by doing what I do after being ignominiously kicked off the various panels (I am a sole practitioner) after many years without ever having received a letter from any mortgage lender chasing a registration or seeking a conveyancing file. I have told every client I come into contact old and new, (in fact pretty much anyone I come into contact with, client or not) to avoid dealing with the lenders who will not instruct me. I have had quite a bit of success clients having withdrawn their applications to the above lenders, and making applications to the sensible ones.
A small defeat, but it makes me feel better.
Separate representation is the only answer - who's going to start the ball rolling?

1. Start on-line petition at www.change.org - as the University of Kent currently have in respect of the proposed sale by the Law Society (as a fundraising drive) of (part of) the Mendham Collection that was gifted to the Law Society at the end of the 19th Century (and you may also wish to sign this petition).

2. Publish article/comment/letter in Law Society Gazette setting out the rationale for separate representation and inviting the profession to sign petition.

3. Provide Law Society and SRA with results of the petition and request that they publish articles in Law Society Gazette setting out their position in relation to such a rule change.

Probably will not make any difference but better than being pushed into extinction and doing nothing?

This lender has appointed its own solicitor to act for it. No money of the lender will pass through my firm. The lender's solicitors who I would like to name and shame inform me that as I am a sole practitioner I cannot represent the borrower. They can provide no rational explanation. I can do no more than report their solicitor to the SRA for endorsing a blatant breach of the principle of freedom of choice of solicitor arguing that surely it must be a breach of the Code of Conduct to actively support such unreasonable restrictions. It will not happen but the SRA should have the wit to charge the solicitor with bringing the profession into disrepute. If no solicitor could act for a lender with such policies, the lenders would surely have to re-think.

Looks like everybody agrees then. I would suggest that 100% of high street solicitors are against these utterly unfair and inequitable goings on, though I am not entirely sure if the enemy is just the lenders or the Law Society as well given the sanctimonious garbage they are inclined to spout!! My clients find the whole thing completely bewildering - hardly surprising.

Some of the above commentators have written the most excellent assessments of the situation. I need say no more, but it all reminds me of the old addage from my childhood, (and I am now 61). Remember : --'sticks and stones may break my bones, but words will never hurt me '--

It is time for ACTION NOW - TODAY - NOT NEXT WEEK when it will be too late for many firms.

Let the Law Society cast the first stone and prove me wrong - LET IT DEMAND SEPERATE REPRESENTATION NOW. No compromise, and no absolutely CQS rubbish!!

I guarantee that this 'seperate representation' would last for less than 6 months before the lenders kowtow.

If the Law Society had any balls, it could force at least some small degree of sanity in this insane world. That is, of course, only if it chooses to do so, gets off the fence and proves me wrong and shows us that it is not working for the enemy after all!

When I was an articled clerk, my firm acted for a large insurance company which provided mortgages for its employees at favourable rates. Ah, the good old days! My firm acted for the lender, the employees had their own separate solicitors.The system worked very well, without inordinate delays as long as both firms acted efficiently.And isn't that what we are supposed to do?

Separate representation across the board for buyers and lenders has to be the way forward.The lenders can then have the "factory" conveyancers act for them, and the rest of us - the high street firms, the long-established firms with commitment to quality (not logos and kitemarks) and service to their often predominantly local clients- will have a chance of survival.

In the past two weeks I have been asked to see elderly clients locally at very short notice, needing urgently to make wills.Can anyone see the likes of CWPL providing that kind of service?

The email from Santander informing us of our removal from their panel with immediate effect went into my SPAM folder. Clearly SPAM filters think as much of banks as we do! I complained and have demanded immediate revocation of the removal, the actions of Santander being in breach of natural justice. I don't suppose I will get anywhere but at least I did get an immediate acknowledgement telling me that I would receive a reply within 28 days.

At the very least I want part of my panel membership fee reimbursed and have considered a small claim. Could all the firms removed from the panel do a Class Action, do you think?

Joy, I have just watched the video, great work. If only all firms would do the same! I will email the link to about 1,000 firms. If you want to get in touch please email me rh@boldlegal.co.uk. I am, after all, only all up the road in Devon.