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Unbundling family legal services

1 May 2013

Legal status

This practice note is the Law Society's view of good practice in this area. It is not legal advice. [Read more]

Practice notes are issued by the Law Society for the use and benefit of its members. They represent the Law Society's view of good practice in a particular area. They are not intended to be the only standard of good practice that solicitors can follow. You are not required to follow them, but doing so will make it easier to account to oversight bodies for your actions.

Practice notes are not legal advice, nor do they necessarily provide a defence to complaints of misconduct or of inadequate professional service. While care has been taken to ensure that they are accurate, up to date and useful, the Law Society will not accept any legal liability in relation to them.

For queries or comments on this practice note contact the Law Society's Practice Advice Service.

Professional conduct

The following sections of the SRA Code are particularly relevant to this issue:

SRA Principles

There are ten mandatory principles which apply to all those the SRA regulates and to all aspects of practice. The principles can be found in the SRA Handbook.

The principles apply to solicitors or managers of authorised bodies who are practising from an office outside the UK. They also apply if you are a lawyer-controlled body practising from an office outside the UK.

1 Introduction

1.1 Who should read this practice note?

Family practitioners who want to offer unbundled (ie partial retainer) legal services to their clients. This practice note is aimed primarily at face-to-face service providers.

1.2 What is the issue?

Since 1 April 2013, legal aid is no longer available for most private family law matters where there is no history of domestic violence and abuse. Clients of modest means including those who would not previously have been eligible for legal aid are unlikely to be able to afford to instruct a solicitor on the basis of a traditional retainer, but they may wish to instruct a solicitor under a partial retainer for a particular aspect or aspects of their case.

Increasingly, firms are introducing some level of unbundled services as a more affordable alternative to the traditional retainer. This practice note aims to advise practitioners on best practice in relation to unbundling whilst pointing out the potential risks and how to minimise them.

2 What is unbundling?

In the context of legal services, the term 'unbundling' is used to describe provision of discrete events of legal assistance in relation to a case under a partial retainer, rather than a traditional full retainer where a solicitor typically deals with all matters from initial instructions until the case is concluded. It is sometimes referred to as 'a la carte' legal services. Unbundling can operate on several different levels such as:

  • providing clients with self-help packs
  • providing discrete advice about a specific step or steps in a case or issue on one or more occasion
  • checking or drafting documents
  • advocacy or provision of a Mackenzie friend in certain circumstances

The essence of unbundling in its purest form is that the case remains client led so the solicitor does not accept service of documents, does not send out correspondence in the firm's name or otherwise communicate with third parties, does not incur disbursements and does not go on the court record. However, there are some limited retainer models that are closer to a traditional retainer in terms of the service offered to the client, but only for clearly defined elements of the case.

In a family law context, unbundled services can be offered for elements of the case such as initial advice on law and procedure, drafting the divorce petition, Form E financial statements, consent orders and advocacy. Assisting clients in relation to contested proceedings may be possible on an unbundled basis, but the greater the solicitor's involvement, the greater the risk that a full retainer could be implied.

3 Risks of unbundling

Unbundling carries some specific risks in relation to the following issues:

  • Allegations of professional negligence arising from insufficient knowledge of the client's situation.
  • Allegations of professional misconduct in relation to client care and duties to the court and third parties.
  • Unwittingly creating a full retainer and the consequent liabilities.
  • Compliance with professional indemnity insurance terms.
  • Dealing with complaints.

3.1 Duty of care

Solicitors have a duty of care to apply the relevant degree of skill and exercise reasonable care in carrying out the task. Although the retainer is an important factor in determining this duty of care, there remains a risk that the scope of this duty may be more widely defined for the purposes of determining professional negligence. It is also important to remember that a duty of care can extend to third parties.

You should clearly express what is covered by the retainer, so that there can be no ambiguity or misunderstanding. You have an overriding duty to act in the client's best interests.If you are concerned that it is not appropriate to limit the retainer in the circumstances or that your client does not understand the consequences of the limitations, then you should not offer an unbundled service.

One professional negligence risk when providing unbundled services comes from advising the client on the basis of inadequate information. You should firmly resist any temptation to make assumptions about the facts.

If you have concerns about insufficient or poor-quality information provided by the client, you should obtain the additional information or clarification required from the client before offering any type of legal assistance. If the client is unable to provide this information you should not advise.

You should also keep a written record of information provided by the client . The advice you give should be provided in writing, with a disclaimer that it is based on the client's information and that you cannot be liable for incorrect advice if the client has not provided all the relevant information.

3.1.1 Case law: Padden v Bevan Ashford

Padden v Bevan Ashford Solicitors [2011] EWCA Civ 1616 demonstrates the importance of exercising care and skill for the work that you have been retained to do.

The case concerned the provision of legal advice to a client (the claimant) who intended to provide security over her matrimonial home to a third party to whom her husband owed a large sum of money. The claimant needed independent legal advice to ensure that there was no undue influence being exercised in her decision to provide security, so she went to the defendant firm to obtain this advice.

The third party subsequently acquired their interest in the property, and the claimant sought damages from the firm for negligently having failed to advise her properly in connection with the transaction.

Solicitor A at the defendant firm advised the claimant, in a short consultation provided free of charge, not to sign documents relinquishing her interests in her matrimonial property in favour of the third party, then wrote a letter stating that the claimant had received independent legal advice.

However, Solicitor A did not give the client comprehensive advice about the nature of the documents, the consequences of signing the documents or the risks involved, which the Court emphasised was an important duty, not a formality.

At a later date, the claimant revisited the defendant firm, accompanied by her husband, to effect the transaction. Another solicitor, Solicitor B, without providing further advice, went on to issue a certificate stating that the client had received independent advice about the transaction and had the consequences and obligations of it explained to her. However, the Court found that the defendant firm did not take adequate steps to properly advise the claimant of the consequences or to safeguard her from undue influence.

This case illustrates the importance of advising a client properly and exercising your duty of care whilst acting even if it is for a limited purpose.

3.2 Going beyond your retainer's limits

Risk also arises where you go beyond the limits of your retainer. You should minimise risk by clearly defining the limits of the work you are agreeing to do. For added clarity you should also include a list of the things a solicitor might traditionally be expected to do but are not included in the unbundled service agreement (see section 5.1 for more information). For example, you should specify if the agreement does not include negotiations with a third party.

In Midland Bank Trust Co Lts v Hett, Stubbs & Kemp (a firm) [1978] 3 ALL ER 571 at 583 Oliver J considered the duty of care owed to the client. "The extent of his duties depends on the terms and limits of that retainer and any duty of care to be implied must be related to what he is instructed to do.... I think the court must beware of imposing on solicitors, or on professional men in other spheres duties which go beyond the scope of what they are requested to do... The test is what the reasonable competent practitioner would do having regard to the standards normally adopted in his profession".

You should therefore exercise strict self discipline in keeping within terms of the agreement so, for example, if you are contacted by a third party for some information, even if it is seemingly straightforward and would not breach your duty of confidentiality you should not provide it if dealing with third parties is beyond the scope of the unbundled arrangement with your client.

3.3 Professional conduct

3.3.1 Professional duty to clients

Your client care obligations as outlined in the SRA Handbook apply as much to unbundled services as they do to a full retainer. In some ways, you may have greater responsibilities to clients of unbundled services to clearly set out your responsibilities and those of your client. For more information, see IB 1.2 and IB 1.5.

You must also act in your client's best interests. In some circumstances unbundling may not be appropriate for your client such as in cases of great complexity or where you have concerns that the client does not have the intellectual or emotional capacity to carry out tasks that fall within their responsibility. In such cases you should carefully consider whether and to what extent it is in your client's interests to provide an unbundled service.

You must ensure that you meet all of your regulatory requirements as set out in the SRA Handbook, including achievement of the outcomes concerning conflicts and confidentiality, even if you only advise the client on a single occasion.

3.3.2 Professional duty to the court

You must comply with your duties to the court as set out in Chapter 5 of the SRA Code of Conduct. If you have concerns that your client may be seeking or intending to mislead the court you must advise them against this, and you should consider ceasing to assist them if they refuse.

When providing unbundled services you should not go on the court record as acting solicitor, even if you are providing advocacy (see section 6 for more information on unbundled advocacy). In these circumstances, the court should not be able to impose any additional duties that would arise from the conduct of litigation as your client retains conduct of their case.

Note: The Society understands that the judiciary are supportive of this approach, but if it became apparent that judges were taking a different view, this advice may be revised.

3.3.3 Professional duty to opposing party

You should follow the requirements of Chapter 11 of the SRA Code of Conduct with regard to not taking advantage of third parties.

3.4 Limiting the scope of the retainer

The basic position at common law is that where is solicitor is instructed in a case, the intention is to create a retainer that lasts until the case is concluded. In Underwood, Son, & Piper v Lewis [1894] 2 QB 306, Lord Esher MR said:

"When a man goes to a solicitor and instructs him for the purpose of bringing or defending such an action, he does not mean to employ the solicitor to take one step, and then give him fresh instructions to take another step, and so on; he instructs the solicitor as a skilled person to act for him in the action, to take all necessary steps in it, and to carry it on to the end".

However this does not mean the retainer cannot be terminated by the solicitor before the end of the case provided that reasonable notice is given and there are reasonable grounds for refusing to act further for the client.

More recently, the principle in Underwood has been cited in Richard Buxton v Mills Owen [2010] 1WLR 1997 and Cawdery Kaye Fireman & Taylor v Minkin [2012] EWCA Civ 546. Although in both these cases, the finding on the facts was that the retainer was lawfully terminated, they establish that you must ensure there can be no inference that a full retainer was created in the first place.

Failure to do so could result in a firm being liable to continue with the case until the end but potentially not being able to recover the full costs. Client care letter templates for advice only (Word 16kb) and for when you are offering advocacy (Word 17kb) have been provided to help avoid this problem.

3.5 Professional indemnity insurance

You should notify your PII insurers of your intention to provide unbundled services. Whether this will have any significant impact on your premiums could vary according to the insurer, their assessment of the risk inherent within the model(s) of unbundling you adopt and the nature of the cases for which an unbundled service is provided.

3.6 Complaints

You must inform your clients of your complaints procedure and their right to complain to the Legal Services Ombudsman.

4 Fees

The main advantage for clients in opting for unbundled services is that they should result in lower costs than a traditional retainer. There is no single fees model for unbundled services, but at the most general level fees should be simple, transparent and affordable to clients of modest means.

4.1 Pay as you go

A 'pay as you go' system requires that the client pays for the advice they receive, as they receive it. Fees might be charged, for example, on the basis of five or six minute units. Each advice session is treated as a discrete event and payment is made at the end of each one. This is a straightforward system with no need to have payments on account or hold clients' money.

You may also consider charging on a traditional hourly rates basis, but this could increase the risk of the retainer being more broadly interpreted if you are undertaking a piece of work that goes beyond an immediate single task.

4.2 Fixed fees

The same type of service could be provided on a fixed fee basis, although for quick pieces of advice, charging by short units of time might be considered to be more flexible.

Fixed fees might be more appropriate for longer pieces of work regarding a defined stage of a case where it is possible to determine the average amount of time for completing the task.

Fixed fees may also be appropriate for advocacy.

Fixed fees must be paid directly into the office account. If you charge by time and any payments on account are made, they must be paid into a client account pending the issue of the final bill. See Solicitors Account Rules 17.4 and 17.5 for more information.

The commercial criteria for setting fixed fee levels are beyond the scope of this Practice Note.

5 Key points for providing an unbundled service

The following checkpoints are based on a client led model where you assist the client to conduct the matter themselves without acting as a representative yourself.

Initial client attendance: Unless there are exceptional circumstances, the initial client attendance should take place at your office. This helps to establish the client's identity and your assessment of your client's abilities to understand and act upon your advice.

Client comprehension: If you have concerns about your client's ability to understand your advice or to act upon it, you must consider whether it is in your client's interests to offer an unbundled service and decline to provide the service if appropriate.

Conflicts and confidentiality: You must achieve the outcomes concerning conflicts and confidentiality set out in the SRA Handbook.

Scope of service: You must inform your client about what the service includes and what is not included. You must ensure that your client understands what you will do for them and what they have to do for themselves. You should also provide this information in writing to your client. You must inform your client about your fee system and when you will require payment. See section 6.1 below for a suggested schedule of services provided and not provided.

Client information: You must inform the client that the advice you give them is based on the information they give you. If the information provided is insufficient or you feel that it is incorrect you must make this clear to the client, and depending upon the circumstances either qualify your advice accordingly or do not advise until the necessary information is provided.

Cost claims: If your client is considering making a claim for costs against their opponent, you should advise them to inform their opponent as soon as is reasonably practicable that they have incurred the cost of legal advice on a discrete issue and, if they are successful, that they may seek to claim this as a cost.

Timeframe: You should be mindful of key dates such as expiry of limitation periods, appeal deadlines and compliance with court directions.

Records: You should keep a written record of the information you have received from your client, what they want to achieve and the advice you have provided. You should retain one copy and give one to your client.

Document retention: You should not generally retain your client's documents save for copies of documents you have assisted the client to draft or complete. In some circumstances you may want to retain a copy of a document that evidences your clients instructions to you.

Complaints: You must inform the client of your complaints procedure and their right to complain to the Legal Ombudsman.

Client care letter: Provided the client has received a copy of the advice given, your pro-forma terms of conditions of service and a copy of your complaints procedure, you may decide that is not necessary to issue a tailored client care letter.

Information packs: If you decide to offer information packs produced by a third party you should include a disclaimer regarding the accuracy or appropriateness of the contents.

Payment: You may choose to require payment on conclusion of the interview, this is indicative of the conclusion of a discrete advice event.

5.1 Suggested schedule of services provided and not provided (non-advocacy)

5.1.1 Services provided

  • Free use of library or online resources (if provided)
  • Self help information packs (if provided)
  • Advice to assist the client to progress the matter themselves
  • Assistance with form filling and drafting letters and documents including basic pleadings
  • Checking documents and forms completed by the client

5.1.2 Services not provided

  • Free legal advice. Clients should be informed about potential eligibility for legal aid. You may want to mention other sources of advice such as the CAB or legal expenses insurance.
  • Conduct of litigation
  • Holding clients' documents
  • Sending letters in the firm's name or other contact with third parties
  • Instructing experts
  • Advocacy
  • Progressing the case - that is up to the client
  • Credit

6 Unbundled representation at court

You may also provide representation at court on an unbundled basis. This could involve taking on a traditional advocate's role without any prior involvement with the case or where you have previously provided unbundled advice as described above. You may also wish to consider provision of a professional McKenzie friend service.

In either situation you must consider whether provision of such a service is in your client's best interests.

6.1 Traditional advocacy service

You should be aware of the risks of undertaking advocacy in respect of a matter in which you have no prior involvement. Unlike a barrister who will typically receive a comprehensive briefing from instructing solicitors, you will have to work with whatever your client has provided you with. Thus the need to obtain sufficient information from your client applies equally to advocacy.

A further factor to take into account is that advocacy typically does not just involve representing your client at a hearing but is also likely to involve negotiations with a third party, and potentially the need to instruct expert witnesses. There is therefore a risk that an unbundled retainer for advocacy will appear similar to a traditional full retainer. You must take extreme care to delineate your unbundled advocacy service from a full retainer by clearly setting out the limits of the service you will provide and what your client must do for themselves. Failure to do so may result in you running the risks and liabilities associated with a full retainer.

The question also arises as to whether as an advocate you need to go on the court record. According to CPR 42.2 (1) (b) it is not necessary to serve notice to the court where the solicitor is 'appointed only to act as an advocate for a hearing'. Similarly, Practice Direction 42.1 (1.3) states that a solicitor appointed in these circumstances 'will not be considered to be acting for that party within the meaning of Part 42'. Accordingly, discrete acts of advocacy may be undertaken without going on the record, provided it is not combined with litigation conducted on your client's behalf.

For the sake of clarity you should hand a letter to the judge stating that you have been instructed specifically as an advocate for that particular hearing and that you are not on the record as acting and do not intend to go on the record. See a specimen letter to the judge (Word 12kb).

Where the court has directed that a bundle should be lodged for a hearing it will be difficult for an advocate to properly carry out their function if the bundle does not exist or is deficient. You should also consider the extent to which costs liabilities may arise for you or your client in cases where the client has failed to prepare a bundle or it has been inadequately prepared.

In view of these risks, where a bundle is required you should consider including the checking of, advising on or preparing the bundle as a standard feature of your unbundled advocacy service, and you should consider refusing to act as an advocate where any required bundle is deficient.

It may be courteous for your client to make their opponent aware that you have been instructed as an advocate for the hearing. You may provide your client with a standard letter to send to their opponent which sets out:

  • the limited nature of your retainer;
  • that you are not on the record;
  • that you will not accept service;
  • and any correspondence should be sent directly to your client.

Although it is unlikely to be an issue in family proceedings, this should put the opponent on notice in respect of potential costs.

6.2 McKenzie Friend

As a alternative to traditional advocacy you may wish to offer your client a professional McKenzie friend service.The role of a McKenzie friend is to provide advice and support to a litigant in person during the course of a hearing. This is set out in some detail in Judiciary practice guidance dated July 2010.

A McKenzie friend cannot address the court without leave, which in the case of a professional McKenzie friend will only be granted in exceptional circumstances. A professional McKenzie friend service could be offered by a suitably trained paralegal and provided to clients for a modest fee compared to a full advocacy service.

As with other services described in this practice note, you must clearly define the limits of the service, and address considerations such as the client's ability to benefit from the service.

6.3 Advocacy fees

Whether you opt for fixed fees or hourly rates for traditional advocacy or for a McKenzie friend, advocacy fees should be simple, transparent and affordable to clients of modest means.

6.4 Additional considerations for unbundled advocacy

As with any unbundled service, you must clearly define the limits of the service so as to minimise the risk that a traditional full retainer is created.

You may wish to treat and bill as a discrete event each hearing you are instructed to attend during the course of a case.

You must clearly set out your fee arrangements for adjourned hearings and hearings that do not proceed as anticipated, for example where a hearing listed for trial becomes a directions hearing.

You must clearly set out what service you will provide in relation to pre-hearing negotiations with the opposing party. You may want to differentiate between negotiations that take place prior to the date of the hearing and those that take place 'at the door of the court'. The latter, which can take place in your clients presence, is less problematic from the perspective of unbundling, than dealing with negotiations which take place prior to the hearing date. You may want to limit any negotiations in the context of advocacy services to the 'door of the court' type.

You must consider how any necessary experts are to be instructed. We suggest that experts should be instructed and paid directly by the client. If you are advising your client on an unbundled basis you can advise them on selecting an appropriate experts and how to instruct them.

Although costs orders are rare in family proceedings you should advise your client as to any potential costs liability and their prospects for recovering costs from the other party.

7 More information

7.1 Practice Advice Service

The Law Society provides support for solicitors on a wide range of areas of practice. Practice Advice can be contacted on 020 7320 5675 from 09:00 to 17:00 on weekdays or email practiceadvice@lawsociety.org.uk.

7.2 Law Society Consulting

If you require further support, Law Society Consulting can help. We offer expert and confidential support and guidance, including face-to-face consultancy on risk and compliance. Please contact us on 020 7316 5655, or email consulting@lawsociety.org.uk.

Find out more about our consultancy services

7.3 Law Society products and publications

7.3.1 Publications

7.3.2 Webinars

7.3.3 Accreditation schemes

8 Terminology

Must - A specific requirement in legislation or of a principle, rule, outcome or other mandatory provision in the SRA Handbook. You must comply, unless there are specific exemptions or defences provided for in relevant legislation or the SRA Handbook.

Should -

  • Outside of a regulatory context, good practice for most situations in the Law Society's view.
  • In the case of the SRA Handbook, an indicative behaviour or other non-mandatory provision (such as may be set out in notes or guidance).

These may not be the only means of complying with legislative or regulatory requirements and there may be situations where the suggested route is not the best possible route to meet the needs of your client. However, if you do not follow the suggested route, you should be able to justify to oversight bodies why the alternative approach you have taken is appropriate, either for your practice, or in the particular retainer.

May - A non-exhaustive list of options for meeting your obligations or running your practice. Which option you choose is determined by the profile of the individual practice, client or retainer. You may be required to justify why this was an appropriate option to oversight bodies.

SRA Code - SRA Code of Conduct 2011

SRA - Solicitors Regulation Authority

IB - indicative behaviour

A glossary of other terms used throughout this practice note is available on the SRA website.

 
 
 

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