LPAs: Regulator satisfied with standard of work
Law firms are maintaining a good standard of service despite increased demand for lasting powers of attorney (LPAs) and deputyship work, a thematic review [1] conducted by the Solicitors Regulation Authority (SRA) has found.
However, the regulator did find that a fifth of the firms studied did not know how many LPAs they had created, which it considered surprising, as “basic information about volumes should inevitably inform decisions about business and resourcing requirements”.
The SRA said both the Office of the Public Guardian (OPG) and the Court of Protection had raised “general concerns” about the capacity of law firms to write and manage LPAs and undertake deputyship roles.
But the thematic review did not find evidence to back this up. It involved visits to 30 randomly selected firms last summer, meeting the heads of their LPA/deputyship teams, interviewing a fee-earner at each firm and reviewing one file setting up a LPA and another managing a LPA/deputyship.
The regulator said it was “satisfied with the standard of work and the files we reviewed”, while warning that “pressure and workloads are unlikely to decrease”.
Law firms “should continue to consider how they will keep pace with the increased demand”, a situation “likely to be exacerbated by firms’ acknowledged difficulty to recruit in this area”.
While it was “satisfied with the quality of service” provided by solicitors, the SRA said only four law firms voluntarily provided costs and service information on their websites.
“This is likely to act as a barrier for consumers and does not promote competition. We would like firms to do more to promote their prices and services, and this could have benefits for both consumers and the firms’ revenue.”
The review did not identify any major issues with cost. Prices ranged from £250 to £800, and averaged £466 (all plus VAT). Most firms offered a price incentive to create both LPAs at the same time and all but three charged a fixed fee.
“Firms attempted to limit the cost of an LPA by making sure the work was undertaken by people at appropriate grades.”
The SRA “found no evidence” that law firms were failing to promptly register LPAs, despite concerns raised by the OPG.
“LPAs could occasionally take significant time to register, but this was due to clients taking time to consider next steps, or the OPG’s registration process itself.”
The review said firms could keep in touch more with clients and help them plan for the future, notwithstanding the “limited regulatory requirement” to do so.
“Interestingly, a third of firms also took this view. These firms realised that in addition to being helpful for clients, it also provided a commercial opportunity to provide other services such as wills.”
The SRA said HM Land Registry had raised concerns about the quality of conveyancing undertaken by firms on behalf of their LPA/deputyship clients.
“Having reviewed complaints and requisitions, we were ultimately satisfied that firms were behaving responsibly.”
The review found some firms addressing the issue of professional attorneys wanting to give up the role, with six firms offering clients the opportunity to appoint a corporate body controlled by the firm as an attorney and five firms exploring this option.
“By using this sort of corporate body, a firm can appoint different managers/owners to the vehicle. This allows individuals to be replaced as they retire and leave the firm. As the corporate vehicle is appointed as the attorney, the client is unaffected by any change in personnel.
“The use of corporate bodies in this capacity is an emerging theme. We know from firms that it can be a costly and complicated idea to execute. There are also associated risks about what happens if the firm closes without a successor practice or a company becomes dormant.”
The SRA said that some of its thematic reviews resulted in “significant numbers of referrals” of law firms to its disciplinary processes, but in this case only one firm was, for failing to act in the client’s best interests when acting as a joint attorney.
The SRA said it was “broadly satisfied” by the results of its thematic review. “Reassuringly, we found that firms with roles in managing LPAs or deputyships did so diligently. And there was no evidence of any abuse of the trust placed in them by what are often very vulnerable clients.
“Firms took their training, supervision and record keeping responsibilities seriously and we did not find deficiencies in the drafting of LPAs.
“However, neither we nor the profession can afford to be complacent because the impact of poor work for such vulnerable clients is high.”