"In the November edition of its "News & Views" newsletter the CML commented upon the Law Society Conveyancing Quality Scheme. The following comments were made:-
"Lenders will continue to control membership of the individual panels of conveyancers that they are prepared to use. But if the new scheme is seen as robust by lenders, many are likely to require CQS accreditation as a minimum condition for panel membership"
It follows that membership of the Scheme cannot be seen as a universal panacea for conveyancers and, in particular, High Street practices. If the CML is implicitly looking at additional membership requirements over and above that of scheme membership then they should put their cards on the table and let the profession know what the Agenda is. Many fear that with the advent of ABS then we will simply see the financial services sector absorb conveyancing as an activity.
There are also concerns around arrangements for professional indemnity insurance with the ABI putting pressure on the SRA to relax the stringent terms of the master policy wording so as to allow claims declinature in cases of fraud, failure to pay premium and, potentially, failure to disclose material facts. There is also pressure to either restrict or limit cover for lenders. Quite clearly the CML is concerned about this and has stated:-
" … there have been indications that the regulatory minimum standards may be changed and potentially will not include cover for lenders as commercial clients. That would leave Solicitors free to choose whether or not they take out separate professional indemnity insurance covering potential losses by lenders. In reality we would expect lenders to require effective professional indemnity insurance if they are to keep a conveyancing firm on their panel. Lenders will therefore demand greater transparency about firms insurance arrangements and will be more active in supervising and monitoring their activity to ensure professional indemnity insurance will be sufficient to cover lenders' risks."
Taken together all this rather smacks of the tail wagging the dog. It is meant to be the SRA that is regulating the Solicitors profession rather than the Financial Services Sector dictating terms.
According to the CML the SRA is planning to publish a paper in December with a three month consultation exercise and "this has the potential to restructure fundamentally conveyancing arrangements in England and Wales.
More than ever it is important that all members of the Solicitors profession take an interest in the consultations that are on-going and make their voices heard
If we are not careful then I can envision a time when there are only half a dozen or so large "factory" units undertaking conveyancing in England and Wales."
(Senior Partner medium size Lexcel accredited firm)
