Nasp maintains a database of the instructions policies of all mortgage lenders, listing those that will instruct sole practitioners, those that will do so provided certain conditions are met, and those that will not. 'Whatever the lending institutions say, there is a problem. I have noticed more and more restrictions from lenders,' says Mr McFarlane-Watts. In some cases, he says, these are camouflaged - for instance, they say they want a smaller panel of approved solicitors.
The Law Society takes up allegations of discrimination against sole practitioners with the offending body. 'Not a day goes by without us questioning lending institutions' policies,' says Karen Aldred, head of property and commercial services at the society.
'We are totally opposed to any restrictions on sole practitioners. We are, however, supportive of measures relating to quality and standards, without, of course, abrogating our responsibility for monitoring and regulating the profession.'
She accepts that ultimately it is up to individual institutions to make commercial decisions about the type of solicitor to accept on to their panels. 'If they want, for example, to limit the numbers in a particular area, we cannot argue.'
The restrictions are affecting not only sole practitioners, Mr McFarlane-Watts says: 'Some of our members tell us that two- and even three-partner firms are being treated in the same way.'
The profession at large is bearing the brunt of tighter procedures at Abbey
National. Amid some controversy, the bank has published new terms and conditions for appointment to its panel of approved solicitors. 'These merely formalise our existing guidelines,' an Abbey National spokeswoman says.
However, some of the new conditions have caused a flood of protest. One cause for concern was the rule on verifying the borrower's identity. 'Obviously, we carry out checks ourselves, but this has been a source of some problems in the past,' says the spokeswoman. 'We're just asking for a back-up check.'
The most controversial issue was 'right of inspection'. 'Some solicitors thought it covered all their files,' says the spokeswoman. 'But we mean only correspondence between us and the solicitor, and the deeds. We are not asking to see anything that is client confidential, and we will always attempt to make an appointment first.' The measure, she says, 'should be welcomed by the vast majority of solicitors as a way of cutting out the possibility of fraud'.
In a joint statement with the Law Society, published in the Law Society's Gazette this week, the bank attempts to clarify its position and to reduce the sting of its original message. 'It is hoped that the profession will recognise that Abbey National is taking proactive measures to combat fraud, and, in this, seeking the support and assistance of the solicitors whom it instructs,' the statement says.
It also proclaims the bank's stand on the sole practitioner. 'Abbey National's new procedures do not penalise sole practitioners in any way. Abbey National has no intention of excluding sole practitioners from its panel.'
Despite a fear among conveyancers that other lending bodies will follow Abbey National's example, none has so far done so. But a spokesman for the Woolwich says that it is reviewing its procedures: 'We accept business on its own merit and will continue to do so while we are awaiting recommendations from the Council of Mortgage Lenders.'
Earlier this month, the council responded to the Law Society's consultative paper on 'the cost of default'. The paper canvassed measures to combat increasing claims on the society's compensation fund. Many of these arise from the defaults of sole practitioners, although such offenders make up a small proportion of the total.
One measure already decided upon is the introduction of tighter controls on solicitors' compliance with the accounts procedures, including routine monitoring of sole practitioners. Another possibility explored in the paper is the capping of grants from the compensation fund to institutions.
In its response, the council welcomes the proposals for tighter controls, particularly on sole practitioners. It adds that in view of the growth in claims, 'further, more stringent measures' may be required.
The council is not in favour of capping, seeing it as a retrograde step that would be 'unproductive both in financial terms and in terms of stemming solicitor dishonesty'. The minimal saving involved would, among other effects, damage the profession's reputation and, more particularly, that of sole practitioners.
Preventive action would be more effective, the council says. Accounts-monitoring visits to sole practitioners should be made more frequently than at the two-year intervals suggested by the Law Society. They should also cover compliance with practice rules. The council admits that while in reality most lenders instruct sole practitioners, 'those lenders which, in the light of current trends and their own experience have decided to tighten procedures in this area, have been requested by the Law Society to review what it sees as 'discriminatory practice'.'
It says it 'very much doubts if it is appropriate that sole practitioners can emerge from the present exercise without 'special' restrictions on their operation'. It wants to see sole practitioners authorised to hold client money only after checks on their accounting systems and compliance with rules, and the introduction of a routine requirement of an accountant's report every six months.
The Law Society, which holds regular liaison meetings with the council, is 'actively looking at some of its practical suggestions,' says Ms Aldred. 'We welcome them and we will be taking them forward.'
Nasp is less sanguine. Part of the association's function is to fulfil a lobbying role. Mr McFarlane-Watts says: 'We attempt to persuade the council that most sole practitioners are very honest people. Personally, I don't believe we will change their hearts and minds.'