Attack on commission clawback

The Law Society is urging law firms to band together to challenge a Legal Services Commission (LSC) claw-back exercise that has seen it attempt to recoup payments on account made several years ago - and which has provoked questions about the LSC's possible own 'maladministration' and 'unreliable' records.

The Society's access to justice committee revealed this week that it has become increasingly concerned about LSC requests that firms should return money paid out for old cases on the grounds that they did not submit final bills.


Committee chairwoman Lucy Scott-Moncrieff accepted that the LSC should retrieve money paid on account when a case had been closed without a bill being submitted if the sums did not add up. But she added: 'We have been told that some of these cases date back 15 years. Once the records have been destroyed, it is impossible for the firms to prove that they had accounted for the money if the LSC claims that it had not.'


One firm in the north of England, which did not want to be named, said it had suddenly been told to pay back thousands of pounds. A partner said: 'This is no way for an institution like the LSC to behave, it is like me sending a bill to a client after six years.'


Ms Scott-Moncrieff urged firms to write to the committee with their own experiences; she said currently it was unaware of how many firms might be affected. 'What we can collectively prove is that the LSC's records are unreliable,' she said. 'We are also considering whether there is evidence of maladministration, which would entitle firms to repayment if it could be proved, as the LSC has a policy of reimbursing any loss caused by its maladministration.'


Legal Aid Practitioners Group director Richard Miller agreed that maladministration could be a factor. 'Many of these cases are six years old, and the LSC should have closed those matters within six years.' However, Mr Miller said he was aware of one case dating back to 1984.


LSC acting chief executive Brian Harvey said: 'We always aim to settle disputes with service providers through negotiation with the parties involved. However, we have an obligation to ensure that taxpayers' money is spent appropriately.'