A two-tier system for regulating will-writing could confuse consumers and lead to a drop in standards, the Law Society has warned.
The Society has welcomed the Legal Services Board’s recommendation that will-writing, estate administration and probate should be regulated. But Chancery Lane is concerned that the LSB’s approach to competition among different regulators may lead to a fall in standards and reduce consumer protection.
Responding to the LSB’s second consultation on will-writing, which closes this week, the Society also raised concerns that, if the proposals were to require significant changes by the existing regulators of will-writing and estate administration activities, it would cause unnecessary delay and confusion.
In September the LSB suggested that will-writing and legal activities provided ancillary to the writing of a will, such as taking instructions, drafting a will and providing advice, should be made reserved activities under the Legal Services Act.
It said that administration of an estate of a deceased person and legal activities provided along with that should also be reserved, and recommended that probate activities remain reserved.
Bodies wishing to be approved as regulators will have to submit their proposed regulatory arrangements to the LSB for approval. The board indicated that regulation will ‘differ from historical models of legal services regulation’ and be ‘sufficiently flexible’ to adapt to the needs of a range of providers.
It said that the regulatory measures proposed will be outcomes-focused with a ‘sharper’ focus on risk, and will ‘allow for a reduced regulatory burden on providers deemed to be low risk’.
Chancery Lane has urged the LSB to ensure that universal minimum protections apply to all those who undertake reserved activities to ensure that consumers are fully protected. It says that the protections offered by solicitors achieve this, but that a two-tier system would be confusing to consumers.
Law Society president Lucy Scott-Moncrieff said: ‘Plans by the LSB to make will-writing and estate administration services reserved activities are a major boost for consumers, but a multiplicity of different regulators and the possibility that existing regulators might have to amend the existing satisfactory arrangements would be a wasteful use of resources and time, as well as cause confusion for firms and clients.
‘Regulation is the appropriate means of protecting the consumer in this area and a consistent standard of regulation for all persons authorised to carry out reserved activities is essential.’
The Law Society supported the proposal, rejected by the LSB, that activities relating to powers of attorney and the setting up of and administration of trusts should also be regulated.
It said it has ‘significant anecdotal evidence’ from solicitors that some unregulated providers are preparing probate papers and then getting the executors of an estate to give them a power of attorney so that the unregulated provider can deal with the probate registry and gain control of administering the estate.
Scott-Moncrieff said: ‘The issues relating to powers of attorney may not be adequately explained to the consumer, who at the point of signing could be in a vulnerable position.’
The Law Society’s full consultation response can be read on the Law Society site.