Exclusive: Accountants to challenge government decision on rights to handle legal work

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6 March 2018

Lidington: Five reasons for refusing application

The Institute of Chartered Accountants in England and Wales (ICAEW) has launched judicial review proceedings against the Ministry of Justice (MoJ) over the decision to deny its members the right to conduct litigation, advocacy and legal instruments work, Legal Futures can reveal.

Last September, the then Lord Chancellor, David Lidington, unexpectedly rejected the Legal Services Board’s recommendation that the ICAEW be granted the power to regulate all reserved legal services, which it said it would only do in relation to taxation work.

It currently has the power to regulate probate work, and hundreds of individuals and firms have taken up the opportunity.

An ICAEW spokeswoman told Legal Futures: ‘We can confirm that we have applied to the Administrative Court for leave to bring a judicial review of the decision in September 2017 by the previous Lord Chancellor not to accept the recommendation of the Legal Services Board that the ICAEW’s designations as an approved regulator and a licensing authority be extended to all reserved legal activities.

“As the matter is sub judice, ICAEW is not in a position to comment further at this stage.”

The MoJ similarly declined to comment given that proceedings were ongoing.

The main question the MoJ will face is likely to be whether it can justify rejecting the recommendation of the Legal Services Board. After an 11-month decision-making process, the board told Mr Lidington it was satisfied that the criteria for making the decision – as set out in the Legal Services Act 2007 – had been met.

Mr Lidington gave five reasons for his verdict: inadequate separation of representation from regulation at the ICAEW; the strong objections of the then Lord Chief Justice, Lord Thomas; the difficulties of restricting regulation to tax work; the negative impact ICAEW-regulated firms could have on the international standing of English and Welsh notarial acts; and that just because accountants were experts in tax did not mean they could be tax litigators or advocates.

Some of these issues were foreshadowed by legal regulatory expert Iain Miller, now a partner at London firm Kingsley Napley, in a blog he wrote for Legal Futures in 2016.

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March 15th, 2018