Solicitors in Scotland are set to vote on whether to continue to allow one solicitor to act on behalf of clients buying a property and their mortgage lender at the Law Society's annual general meeting on 22 March 2013. Solicitors will debate a recommendation to introduce separate representation in all conveyancing transactions, which would mean removing the current exemption to conflict of interest rules which allows solicitors to act for both borrower and lender.
Having a solicitor act for both the buyer and the lender has recently been brought into disrepute on account of a rising number of mortgage frauds, where solicitors have been pocketing monies destined for lenders yet apparently escaping criminal charges after botched investigations on the Law Society’s part.
Austin Lafferty, president of the Law Society of Scotland, who once said on BBC his ideal client was a little old lady with £100K and a house to sell, said: "Changes in bank and building society's practices have resulted in increased pressure and risk to solicitors in continuing to represent both parties. In recent months the 'sep rep' movement has grown, and increasing numbers of solicitors, although by no means all, are in favour of removing the exemption, meaning lenders would have to appoint their own solicitors, which immediately removes the risk to the buyers' solicitors.
"While there would be clear benefits to introducing this change, as might be expected there are some potential downsides to having separate representation, such as the possibility of increased costs and paperwork. However given the increased pressures imposed by lenders on solicitors up and down the country, this is a crucial debate to have and it will be for our members to decide what they want to see happen. I would urge any of our members involved in conveyancing to come along to the AGM to take part in this important debate."
Solicitors will also have the chance to debate the 'Future of the solicitor profession' at a CPD seminar immediately after the AGM. Recent research showed that the profession was evenly split between those who were optimistic about the future and those who had a more pessimistic perspective on changes within the legal sector.
A panel of solicitors, representing different areas of the legal profession, including high street and big firms, in house and newly qualified lawyers, will give their thoughts before opening the debate to the floor.
Confirmed panellists are: Anne Ritchie, President of Glasgow Bar Association, Anne MacKenzie, chief counsel at Glasgow Housing Association, Graham Gibson, partner at Kirklands Law Limited, Rosanne Ogden, Scottish Young Lawyers Association, Richard Masters, Head of Client Operations at Pinsent Masons
The AGM is to be filmed for the first time and will be available for Society members to view on the Society's website from 2 April. There will also be live tweeting - follow the discussions on #LSSagm via Twitter.