Banks and shops given right to sell legal advice under plan

Click to follow

Supermarkets and banks will be allowed to sell their customers divorces, wills and advice on home-buying under a radical shake-up of the provision of legal services approved by the Law Society last night.

Supermarkets and banks will be allowed to sell their customers divorces, wills and advice on home-buying under a radical shake-up of the provision of legal services approved by the Law Society last night.

A new free market for law will end the monopoly of the high street legal practice while unleashing the huge retail resources of the country's best known company brand names.

A number of retailers, including Tesco and Virgin, have already indicated their interest in setting up so called "law shops" run by their own lawyers.

Yesterday the ruling body of 80,000 solicitors in England and Wales voted in favour of beginning "immediate talks" with the Government on the necessary legislation to bring in what it described as a "major development" in the provision of legal services.

Janet Paraskeva, the Law Society chief executive, said: "We look forward to working with the Government and consumer bodies to help us put in place the required consumer safeguards in a market that offers greater choice."

The new legal landscape would give the customer the option of choosing between a business such as Virgin Legal or Tesco Lawyers and a traditional high-street solicitors' practice.

A Law Society document outlining the arguments for and against the change states: "By and large, retailers, insurers, banks and building societies as groups meet the expectations of their customers. Their names are known to and trusted by their customers.

"If we believe in professional standards, we ought not to be afraid to put our belief to the test by giving the consumer the choice."

Around 20,000 solicitors already work exclusively for businesses, advising them on the law. The trend is for this number to increase. Many of these "employed solicitors" believe that the existing rules serve the high-street solicitor but do not work to their advantage.

But critics of the plans to open up the legal marketplace argue that to take them to their full conclusion, an unstructured relaxation of the rules might eventually lead to supermarkets selling legal advice to shoplifters.

The Law Society is keen to retain its regulatory role so it can prevent this kind of potential conflict of interest.

In the past few years, claims companies have taken clients from the high street and processed their personal injury claims by referring them to their panels of solicitors.

Under any change to the rules the temptation to cherry pick the most profitable services at the expense of social welfare legal advice would need to be addressed, the Law Society has said.

A Law Society consultation paper, which led to yesterday's historic vote, warns: "If a company chose to stake its claim on the high street by buying out an existing high-street practice, it may well be willing to include, for the time being, all areas of work currently offered ... but some years down the line it might seek to off-load unprofitable service."

Last year the Office of Fair Trading's investigation into restrictive practices in the legal profession identified possible changes to the legal marketplace. A government bill which will look at a number of the OFT's recommendations for improving competition in the professions is expected to be published shortly.