Ombudsman's case fee compromise eases solicitors' concerns

Solicitors have accepted a 50% increase in the case fee for complaints handling – but with a warning that such rises should be curbed in future.

The legal ombudsman is now proposing to increase from £400 per case to £600 the amount that a firm has to pay if the ombudsman formally investigates a complaint.

The service had initially been proposed in its 2025/26 budget and business plan. This proposed that the case fee should be changed to £800, rising to £1,000 for cases that become more complex. There was also a proposal for a new ‘polluter pays’ principle, where the case fee would rise to £1,000 for firms on the end of a specified number of upheld cases.

The ombudsman has admitted the proposals received criticism from the legal profession for being disproportionate. Last month the planned case fee was reduced to £600 and the idea of tiered fees scrapped.

Announcing the revised structure, Elisabeth Davies, chair of the Office for Legal Complaints, said: ‘Those who responded expressed a concern that an increase to £800 might be too large and could have a detrimental impact on providers operating in markets where margins are tight or where access to funding is limited.

‘It was suggested that an increase of the order originally proposed might discourage providers from providing legal services in these sectors which might have an adverse impact on consumer’s access to justice.’

This partial climbdown appears to have been enough to placate the Law Society, which has said it is pleased with the more modest increase which reflects inflation since the £400 rate was set in 2010.

But the ombudsman has been warned that such case fee rises cannot become a regular feature, given the pressures faced by firms operating on small margins.

Society president Richard Atkinson said: ‘We recognise the importance of ensuring LeO is adequately resourced; however, it is essential that costs imposed on legal service providers are reasonable, proportionate, fair, and predictable. We urge LeO to continue monitoring the effects of increasing case fees as it will have a material impact on some firms. It is important to ensure the funding model does not inadvertently discourage firms from undertaking work that is vital for people to be able to access justice.’

He added that there should be a five-year cycle introduced to strike a ‘reasonable balance’ between proper oversight and administrative efficiency.

‘We welcome a structured, predictable review process for LeO’s case fees to ensure that future changes remain fair and manageable for our members,’ said Atkinson.