New pricing rules will mean it pays to ‘shop around’ for legal services

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Paul Wright CEO, Quartz Barristers
Paul Wright CEO, Quartz Barristers

Paul Wright, CEO, Quartz Barrister urges SME’s and individuals to ‘shop around’ for legal services or risk paying over the odds, thanks to new price transparency rules being introduced this month

Litigation can be emotionally draining, so finding a reliable yet, cost effective legal service provider can present a major headache. Smaller businesses have a greater need for external support than large ones, however many will still try and handle legal issues alone or turn to family and friends for help as they wrongly fear that legal services will be expensive.

According to a 2018 Legal Service Board (BSB) report, ‘the impact of legal problems on small businesses is costing the UK economy £40 billion a year, with 1 million individuals suffering ill health as a result, so access to legal services remains a major concern.’

New price transparency rules
So the Bar Standards Board (BSB) agreed new rules to improve transparency standards for barristers’ clients in February this year. Subject to LSB approval, these rules will come into force this month, with compliance spot-checking by the regulator from 2020.

The rules are designed to improve the information available to the public before they engage the services of a direct access barrister. It will require all direct access barristers to publish their pricing and services online. Commonly used pricing models (fixed fee and hourly rates), details of the services they offer and guidance on timescales of work must all be provided.

Under the new rules direct access barristers will be required to provide more detailed information and pricing in relation to eight types or work:
• Employment tribunal cases
• Financial disputes arising from divorce
• Immigration appeals
• Inheritance Act advices
• Licensing applications in relation to business premises
• Personal injury claims
• Summary only motoring offences
• Winding-up petitions

This new drive to publish legal price lists is in response to the Competition and Markets Authority’s (CMA) 2016 study which stated, ‘not enough information is available on price, quality and service to help those who need legal support to choose the best option.’ It concluded that competition in legal services for individuals and small businesses was not working well.

BSB Director of Strategy and Policy, Ewen MacLeod agreed with the CMA stating recently that “greater transparency at the Bar should enable consumers to shop around when looking for a barrister and promote competition in the market.”

So what is Direct Access?
The Direct Access scheme was first introduced in 2004, to help increase access to the legal system by the public. It was part of a wider initiative to make it easier and cheaper to obtain legal advice. Traditionally SME’s and individuals would go to a solicitor with their legal problems and a solicitor would turn to a barrister when needed for their expert skills. But now it means that businesses don’t need solicitors – they can go direct to a barrister instead.

These new rules represent therefore, a positive step forward, however many small business owners are still unaware that if they go direct to a barrister it is typically 30% cheaper that going via a solicitor, given this advice which would you choose?

At Quartz Barristers our prices are fixed and agreed with clients in advance, there are no hidden costs so access to the law is simpler, more affordable and transparent. Here a recent case study profiles the work of barrister, John Hudson who specialises in family finance work involving businesses.

John Hudson, Barrister
John Hudson, Barrister

Business asset – case study
The client’s only significant asset was a business which employed over 20 people. The business was struggling but notwithstanding the reality of the situation, the other side believed that the business was far more successful than it appeared from the accounts. The other side had subjected the client to numerous requests for information relating to the business but did not seek a professional valuation. The client had been dealing with matters himself due to a lack of means.

He approached Quartz Barristers and instructed direct access Counsel for the final hearing. A contested final hearing took place and the District Judge accepted the client’s evidence. A division of assets was made on the basis of the client’s evidence, while the other side’s evidence was rejected. (The work involved representing the client at the final hearing – £3000 + VAT.)

As this case study highlights, it is all too easy to assume that legal services will be expensive, whereas in this instance advice from a direct access barrister delivered value for money to the client, even very late in the day at a final court hearing.

Overcoming price perceptions
This new guidance will no doubt help businesses and individuals to understand the legal services available to them more easily, so they can make more informed decisions. A recent market report published only this month by IRN based on 1,207 consumers found that the large majority, ‘77% are more likely to use law firms that publish their fees online’.

The challenge isn’t about price comparisons alone however, it is also about the quality and level of service provided. Essentially, these regulations are part of a drive to make clearer, more accurate and relevant information available to businesses and individuals.

It’s our belief therefore, that expert legal advice at the lowest cost, within a short timescale is what small businesses are looking for, we need to overcome perceptions of high cost to start making a difference – so there really is no better time to ‘shop around’ for legal services.

Paul Wright is responsible for the administration of chambers, strategic planning and business development. His strength in leadership, practice management and his knowledge of the rapidly evolving legal market, ensures that its clerks can deliver the most effective practice management for each barrister.