‘List of defaulting solicitors’ to be ditched but cab-rank rule set to survive

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27 July 2015


contract

BSB’s standard contractual terms to stay in place

The Bar Standards Board (BSB) is to dispense with its ‘list of defaulting solicitors’ and replace it with a new rule allowing barristers to refuse work under the cab-rank rule where there is an “unacceptable risk” that they will not get paid.

The move comes as part of a review of the rule and the standard contractual terms, and the BSB’s decision to retain them.

The standard terms were introduced in early 2013, following approval from the Legal Services Board (LSB) the previous year. However, the LSB launched an investigation into the Bar Council’s involvement in the rule change, which was only resolved when the Bar Council gave a number of undertakings.

One of them was that by 31 July 2014, the BSB would review whether it was appropriate for standard terms and the related cab-rank rule – that the rule does not apply other than where a barrister is instructed under the terms, or under their own terms – to remain as regulatory arrangements.

It failed to meet this deadline, leading to the issue of an apology by BSB director Vanessa Davies in December last year and a new deadline of 31 July 2015. The BSB launched a consultation on the issue in March and it seemed then that the rule might be scrapped.

Following last week’s meeting of the BSB board, a spokesman said that a “full and thorough review” of the standard contractual terms and the cab rank rule had been carried out.

“This is a review which we have undertaken from first principles, and we have reached a decision entirely independently of the Bar and its representative bodies.

“We have collated evidence from a wide range of interested parties, and analysed the issues with reference to the regulatory objectives and the consumer interest.

“The evidence has led us to conclude that, in the public interest, it is necessary to retain the reference to the standard contractual terms within the cab rank rule. In short, the current rule is, in our opinion as an independent regulator, the best way to achieve the regulatory objectives.”

Research carried out by the BSB showed that nearly two-thirds of barristers offer to be instructed on the standard terms, with most of the rest on their own terms; it was “relatively uncommon” for barristers to accept instructions on terms dictated to them by the instructing party.

It also found that three-quarters of barristers surveyed had never had the cab-rank rule invoked, while almost all of the rest had only experienced it rarely.

The BSB is to write to the LSB explaining the process it has adopted and enclosing its application for the necessary rule changes by the end of this month.

The spokesman said new rule on credit risks would take a “more outcomes-focused approach, enabling barristers to refuse to take work under the cab rank rule where there is an unacceptable risk that they will not be paid by the professional client”.

The spokesman added that it would be supported by new guidance on how to make decisions on whether to refuse work.

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