An appeal court ruling last week appears to have delivered a serious blow to solicitors seeking to offer ‘unbundled’ services without being held liable for matters beyond those in their client retainer.
The judgment, in Sequence Properties Ltd v Kunal Balwantbhal Patel ‘pretty much kills unbundled litigation services’, one practitioner told the Gazette. The Law Society, meanwhile, agrees the case may 'present difficulty' and has called for statutory protection for solicitors offering such services.
The case concerned an application for permission to appeal against a costs order imposed for the late filing of an appeal bundle that was not served on the opposing party. Although both parties instructed counsel directly, the applicant made reference to a solicitor who assisted on an ‘allegedly limited’ retainer.
Refusing the application, Mrs Justice Asplin (pictured) held that although the applicant was apparently acting without a solicitor on record, he had had the assistance of a solicitor through ‘unbundled services’.
That gave rise to the question of whether the solicitor was ‘on the record’ in the instance case. The order to file an appeal bundle had not specified that it should have been served on the claimant – but the judge noted that the solicitor had been involved and must have been aware that service should take place.
Taken together, the failure to file the appeal bundle in time, even if only by nine days, and the failure to serve the bundle on the claimant were ‘a significant and serious breach of court rules’.
The judge said that even though the reason for the breach appeared to be that the appellant was a ‘quasi litigant in person’, different rules did not apply to different parties depending on their status.
On occasion some latitude was given, but the applicant had the assistance of a solicitor at least in the process of producing the bundle. No other reason had been given aside from his status; there was no good reason why he had not filed the bundle in time.
The full judgment has yet to be published. However, the fact that it was framed with reference to the unbundled legal services being a factor in finding against the LiP is seen as highly significant. ‘It sends a signal that people should be very cautious about accepting unbundled retainers,’ one solicitor told the Gazette.
‘If accurate, it pretty much kills unbundled litigation services. [Lord ] Dyson [MR], Briggs LJ and others who want to see innovative offerings to reduce the price of legal services should think carefully about this.’
The judgment also appears to contradict last November’s appeal court ruling in Minkin v Lesley Landsberg, which offered reassurance that solicitors would not be held liable for issues that fall outside the scope of their retainers.
In that judgment, Lady Justice King stressed: ‘There would be very serious consequences for both the courts and litigants in person generally, if solicitors were put in a position that they felt unable to accept instructions to act on a limited retainer basis for fear that what they anticipated to be a modest and relatively inexpensive drafting exercise of a document (albeit complex to a lay person) may lead to them having imposed upon them a far broader duty of care.’
Law Society chief executive Catherine Dixon said: 'The government, courts and Legal Services Board have all said recently that they wish to encourage solicitors to deliver unbundled services as a way of making legal advice more affordable.
'This case may present difficulty for lawyers offering unbundled services. The judgment could suggest that a solicitor may be under a duty to advise the client of procedural requirements that fall beyond the discrete acts of legal assistance required by the client.
'We are concerned about the potential consequence of the ruling and we invite government to consider the introduction of statutory protection for solicitors delivering unbundled services for acts or omissions which fall outside the scope of their retainer. Our members require assurance that professional accountability is limited to the services the client was willing to pay for.'