Size no longer everything for solicitors

The solicitors' rule book will shortly be slashed to fewer than 100 pages.

Neil Rose investigates the future of regulation and the prospect of 'supermarket' law firms When it comes to holding doors open, few books can be more widely used in law firms than The Guide to the Professional Conduct of Solicitors.

The latest edition, the eighth, runs to 893 pages, but its days as a doorstop may be numbered.The ninth edition, scheduled for release at some point in 2002, is set to be - remarkably - fewer than 100 pages long.

And if the mood of the Law Society Council during last month's discussion on the future of regulation prevails, the tenth could be shorter still.Edward Nally, chairman of the regulation review working party, which is behind the rationalisation of the rule book, explains that the ninth edition will contain the core principles ('two pages of A4'), followed by the subordinate rules.

The major change comes in the notes and guidance, which have been pared down hugely to 'limited, essential interpretive guidance', Mr Nally says.It will in future, he explains, be for others to interpret the rules, whether that guidance comes from textbooks, commentators or other sources of best practice.

'A lot of it is common sense,' he maintains.The sweet smell of deregulation - as many will view it - is very much in the air and the need for a fresh look at the rule book is clear; the demographics of the profession have altered sufficiently in the past 20 years to demand such a review.It is debatable whether solicitors actually enjoy self-regulation, as they theoretically do.

The Lord Chancellor, Civil Procedure Rules, the Legal Services Commission and the Financial Services Authority, for example, all bear heavily on the way solicitors operate.

It was this realisation that made the Law Society of Scotland rename its recently formed self-regulation working party as the regulation working party.In their discussion, council members in England and Wales faced three broad options:l The 'traditional professional' approach, characterised by regulation to preserve the profession's core values, strict regulation of the entities through which solicitors practise and of solicitors' methods of attracting business, as well as less emphasis on regulation to promote good service;l The 'progressive professional' approach, which regulates to preserve core values, regulates if necessary to promote good service, but ensures that restrictions on entities and methods of doing business go no further than are needed to preserve enduring values, or to maintain public trust in the profession, and;l Complete deregulation, which would confine professional rules to those which directly preserve the core values.

There would be no additional rules concerning entities or methods of attracting business; reserved work might be abolished, as might the Law Society's inadequate professional services jurisdiction, while indemnity insurance could become voluntary.During the debate, a popular so-called 'fourth way' emerged, which on reflection was little different from the second option.

This entails liberalising the entities through which solicitors provide legal services while retaining provisions to ensure high-quality services and to protect the public from solicitors' negligence or dishonesty.

Basically, this would mean retaining client protection rules and removing the rest.In a straw poll of the council, nobody voted for the first option, ten went for option two, six for option three and 25 chose the fourth way.As lay member Sally Irvine told the council, all these approaches are along the same line; it is just a matter of where you place the cut.Mr Nally notes that it is easy to favour general relaxation of the rules, but says the effect of specific changes needs to be considered.

It is all very well to do away with the restrictions on advertising, but would the public welcome cold calling? The Office of Fair Trading may think so, but it is likely to damage the reputation of the profession.

Hence in a recent vote to liberalise the publicity code, the council approved removing the cold-calling ban in relation to businesses, but not to individuals.Indeed, Mr Nally argues that the blunt analysis that you should retain client protection rules and ditch all others assumes 'an artificial division' where there are some rules which are not framed with the public interest in mind.

He says the fourth way was effectively a discussion on forms of business for solicitors.Several council members agreed that there was a confusion between regulation and competition.

It is not possible to deregulate totally, as there will always be a demand to protect those receiving advice, wherever it comes from.

Edward Solomons, who represents the Government Legal Service, argued that if anyone were allowed to do what solicitors do, it would not mean that there would be no regulation.

'Everyone will be regulated,' he said.Helen Clarke, for the probate section, said the key point was 'reputation, reputation, reputation'.

She explained: 'I don't want to be out there with everyone else.

That's why I became a solicitor.'Moves are already afoot to end the ban on fee-sharing, which would open the door to multi-disciplinary partnerships, with broader liberalisation of solicitors' mode of practice.

That they need this freedom to meet the competition of modern society is hardly contested; as it is, many firms have in recent years shown remarkable ingenuity in re-engineering their processes within the restrictive framework of the rules.Solicitor property sellers are a good example of what can be done.

Law Society of Scotland president Martin McAllister, who was an observer at the council debate, is one himself.

He said: 'We cross-sell until we're cross-eyed.

We do it because clients want it and we do it in a regulated way.'The idea of Virgin Law or Tesco Solicitors has been around for some time now, and the recent sale of London law firm Statham Gill Davies to accountants Tenon - which saw the lawyers involved give up their practising certificates - has shown the urgency for change.There is still considerable value to being a solicitor as opposed to, say, a claims manager.

Whatever the overall public view of the profession, clients generally give their own solicitors favourable reports.The trick is to strike a balance between regulation and liberalisation.

As another observer at the council meeting, Law Society ofIreland secretary-general Ken Murphy, put it: 'The solicitors' brand is very valuable.

That's why Tesco andothers want that brand.

My advice is: don't sell it cheaply.'