Law Society hits out at Co-op conveyancing panel decision

By Ben Schofield on Oct 7, 09 12:26 PM

THE Co-op today came under fire from the Law Society for putting sole practioners "at risk of closure".

The society says up to 3,600 firms could go to the wall after being taken off a Co-operative Financial Services' (CFS) conveyancing panel.

It adds if other banks and building societies follow suit the society warns "access to justice in small towns and rural areas could be severly damaged".

CFS is the group of businesses that includes The Co-operative Insurance and The Co-operative Bank including smile and Britannia.

In September it gave sole practitioners one month's notice of their removal from the Britannia conveyancing panel.

CFS cite insurance difficulties as the driver for their decision, but the society is not convinced by their argument.

In a statement the society said it was "dismayed" by the decision.

It added: "CFS widely claims it has created a fair and ethical alternative to other high street banks, yet this move is not only unfair for consumers and solicitors, it reduces consumer choice for house buyers and unfairly deprives sole practices of business during the worst economic recession for 60 years."

Law Society president Robert Heslett said: "We consider this decision belies CFS's claim that they are committed to leading the way on ethical and community matters.

"CFS say that 'Britannia already has a commitment to social responsibility and both companies see this as a great opportunity to create a strong organisation, founded on long-standing values of trust and ethical behaviour' - yet this move could well contribute to putting several thousand solicitors livelihoods and the livelihoods of their employee's at risk."

But Mike Fairbairn, CFS director of risk said: "Throughout this process the interests of our customers and members has continued to be our main priority. We have explored with all the respective Law Societies a number of self-insurance routes linked to their own existing compensation schemes.

"We have studied these options, with our own expert legal opinion, and we believe that Scotland may, pending further discussions, provide the appropriate levels of reassurance we require. The Law Society of Northern Ireland is considering its requirements to determine what reassurances it can provide in the circumstances. This has led us to extend their deadline to October 21.

"Unfortunately we do not believe from the conversations that have taken place with the Law Society representing England and Wales that such re-assurances will be forthcoming.

"We are, in effect, being asked to assume risks in relation to sole practitioner fraud that should properly lie with the profession itself.

"We fully understand the disappointment this will cause amongst the English and Welsh Law Society and their sole practitioner members, but our duty rests clearly with our members and it is with their interests in mind, that this decision has been taken. "