The Provision of Services Regulations contain provisions as to the information which lawyers must give to clients and customers. Duncan Finlyson of Lawyers Defence Group outlines their implications. Lawyers Defence Group is a Legal Futures Associate
Service please: regulations say lawyers must respond to complaints from clients as quickly as possible
On 28 December 2009 the Provision of Services Regulations 2009 came into force. These regulations apply to almost all service providers in the UK, including lawyers, and contain provisions as to the information which must be given to clients and customers.
All lawyers who provide services to private and business clients are subject to these regulations and, in addition, those lawyers working in in-house practice may need to be aware of them on relation to the business of their employer.
The regulations implement the EU Services Directive (2006/123/EC) and apply to most service providers, and cover the provision of services to individuals and to businesses. There are a number of exceptions to the regulations. These are set out in regulation 2 and include:
- Financial services, such as banking, credit, insurance and re-insurance,
- Electronic communications,
- Transport, including port services
- Temporary work agencies,
- Audiovisual services, and
Whilst most firms will already provide much of the information which is required under the regulations, nevertheless firms must ensure that they do provide the information and that it is made available in the correct manner. In doing so they may need to look at their client-care letters, website and other information provided to clients. They must also be aware that some of the information they must provide in advance and some is required to be provided on request.
Below we look in more detail at the requirements and contains suggested text that firms may wish to take and adapt to deal with the requirements.
The regulations operate in addition to, and not in place of, any requirements that may be placed upon a lawyer by their own regulator’s rules or code of conduct. Thus, for example, solicitors will continue to be subject to the provisions set out in rule 2.02 on providing the client with information about the firm and client’s responsibilities or the provisions contained in rule 2.03 as to costs.
The regulations apply both to business-to-business activities as well as to business-to-consumer activities, and can even affect the sale of goods where some form of after-sales service is being provided. Thus the regulations will apply to many different service providers including:
- Those who provide services to other businesses, including, marketers, consultants, agents, designers, maintenance companies and PR companies;
- Those who provide services to both businesses and consumers, including solicitors, accountants, estate agents and architects; and
- Those who provide services to consumers, for example plumbers, electricians, decorators, builders, tour operators, leisure service providers and sports centres.
The principal informational requirements of the regulations are set out in part 2 (regulations 7-12). These are divided into four sections:
- Contact details (regulation 7);
- Other information to be made available on every occasion (regulation 8);
- Information which must be supplied on request (regulation 9); and
- Dispute resolution information (regulation 10).
Regulation 7 requires that a provider of services make available contact details to which those for whom the service is provided can send a complaint or a request for information about the service. Those contact details must include:
- A postal address, fax number or e-mail address;
- A telephone number; and
- Where the service provider has an official address, that address. By official address is meant that address which the provider of the service is required by law to register, notify or maintain for the purpose of receiving notices or other communications.
By virtue of regulation 8, the provider of a service must provide to the recipient of a service a range of other information, including the name of the business, VAT number, legal status of the business (ie, sole trader, partnership, limited company) and any authorisation.
There are a number of ways in which this information can be provided and these are specified in paragraph 2 of regulation 8. They are:
- Supplied by the provider to the client “on the provider’s own initiative”, for example by being given in writing to the client or included in a standard letter or leaflet;
- By being made “easily accessible” to the client at the place where the client receives the service or at the place where the client enters into a contract for the service to be provided, for example a printed copy of the information readily available at the lawyer’s office;
- In an “easily accessible” electronic format – for example, giving the client a web address where the information can be found; or
- In any other information document supplied to the client and which gives a detailed description of the service – for example, the firm’s terms of business.
Thus, the firm may choose one of a number of ways of displaying the information. It may be worthwhile for firms to think carefully about how they want to make some of the information available – especially those firms who are, or think they may become, the subject of identity theft. Whilst clearly firms will need to comply with the regulations, they wish to avoid making generally available that information which could be used by those wishing to pass themselves off as the firm or, for example, wanting to use the firm’s VAT details as part of a tax fraud.
Information to be supplied on request
The lawyer must also make available to the client certain information as to price, conflict and professional rules when the client requests it. Whilst much of this is already covered as a requirement in the Solicitors Code of Conduct, nevertheless the need to provide it upon request makes it worth noting. That information is:
- Where there is no set price for a given type of service, the price of the service, or if an exact price cannot be given, the method for calculating the price so that it can be checked by the recipient, or a sufficiently detailed estimate;
- Because the lawyer carries on a regulated profession, a reference to the professional rules applicable in the EEA state in which the provider is established and how to access them – in other words a link to the Solicitors Code of Conduct and other rules on the Solicitors Regulation Authority website;
- “Information on other activities undertaken by the provider which are directly linked to the service in question and on the measures taken to avoid conflicts of interest” – care must be taken here that the firm does not breach a requirement for confidentiality and should have been addressed fully at the outset using the firm’s own internal conflict procedures; and
- Any codes of conduct to which the provider is subject and the address at which these codes may be consulted by electronic means, specifying the language available – in other words a link from the firm’s website to the appropriate part of the Solicitors Regulation Authority website would normally suffice, or if the firm does not have a website, details of where the client can go on the web to see those rules.
Note that in relation to the third bullet above that this information must be included in any information document that the lawyer gives to the client and which contains a detailed description of the services provided by the lawyer.
Regulation 10 deals with the need to resolve complaints and requires that, where a “provider of a service who is subject to a code of conduct, or is a member of a trade association or professional body, which provides for recourse to a non-judicial dispute resolution procedure”, then the provider (that is, the lawyer) must inform the client of that fact, mention it in any information giving a detailed description of the service (ie, the terms and conditions) and specify how information about it can be accessed by the client.
Thus, for a solicitor, information should be provided about the role of the Legal Complaints Service and how it can be contacted, for a barrister details of the Bar Standards Board’s complaints and disciplinary system, for a licensed conveyancer details of the complaints procedure on the Council for Licensed Conveyancers website, and similarly for all other regulated professionals. In all cases these roles will be taken over by the Office for Legal Complaints in due course.
Note that the regulations do not alter or remove the need for firms to have their own complaints process in place within the firm and for details of this to be brought to the attention of clients, as required by rules 2.05 and 5.01. Therefore, rather than having the information required by these regulations on a standalone basis, it may be expedient for the firm to bring to the attention of the client the information which the regulations require and information about their own internal complaints procedure.
In addition to the need actually to provide information, regulation 12 provides that the lawyer must respond to complaints from clients as quickly as possible, and, unless the client is a vexatious complainant, try their best to find a satisfactory solution.
Clear and unambiguous
Regulation 11 provides that when information is made available, it must be in a “clear and unambiguous manner”, and must be provided in good time before the conclusion of the contract or, where there is no written contract, before the service is provided (unless the information is requested as specified in regulation 9 after the provision of the service).
In other words, the information in regulations 7 and 8 must be supplied before the client becomes committed to use your services or before the provision of the service commences, and in the case of information requested by the client, as soon as possible after the request is made.
This could cause some problems for firms if they are being required to act quickly to represent a client or if they are, for example, taking instructions and commencing to act away from the office. Firms are therefore recommended to address their procedures for dealing with such circumstances, for example, by carrying pro forma information for use out of the office.
The majority of the remainder of the regulations deal with the requirements placed upon competent authorities.
The regulations themselves can be found at: http://www.opsi.gov.uk/si/si2009/draft/ukdsi_9780111486276_en_1, whilst further guidance from the Department for Business, Innovation and Skills can be found at: http://www.berr.gov.uk/files/file53100.pdf
What if you fail to comply with the regulations?
In most cases it is unlikely that a breach of the regulations will lead to any specific enforcement action, other than possibly by the lawyer’s own regulator. Certainly in the case of business-to-business transactions, it will be up to the client to complain and, if they feel sufficiently prejudiced by the failure, take action in the courts. In most cases where a complaint is made, simply providing the required information will normally resolve the position.
Where private clients are concerned, it is more likely that the Office of Fair Trading or consumer body would take action against those firms whose breach affects the collective interests of consumers.
Prohibition on discrimination
Part 5 of the regulations makes provision for the avoidance of discrimination.
Regulation 30(2) provides that service providers must not, in their general conditions of service, make provisions which are discriminatory in relation to the place of residence of recipients of a service who are individuals where there are no objective criteria which would justify such discrimination. By discrimination is meant, for example, offering a service on different terms, providing a different service or refusing to offer a service at all.
Whilst the regulations do not define what would be regarded as acceptable objective criteria for discriminating, they are likely to include issues such as additional cost of providing the service. However, it should be noted that a blanket refusal to provide services to a particular location would only be likely to be justifiable if it could be shown that it was always going to place unreasonable increased burdens upon the business.
Tags: Client care, complaints-handling, Provision of Services Regulations
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