1.1 Who should read this practice note?
Civil practitioners who want to offer unbundled (ie limited retainer) legal services to their clients. This practice note is aimed primarily at face-to-face service providers.
1.2 What is the issue?
This is a revised version of the Law Society's earlier practice note on unbundling legal services. The initial version considered unbundling of family law legal services but, following a review, it was felt that the greater part of the content and advice provided is generic to a wider range of civil law matters, and that there is no inherent reason why unbundling should be limited to family law. The revised practice note reflects this change.
Clients of modest means, including a number of those who would previously have been eligible for legal aid prior to the April 2013 civil scope cuts, are unlikely to be able to afford to instruct a solicitor privately on the basis of a traditional full service retainer. They may, however, wish to instruct a solicitor under a limited 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 while pointing out the potential risks and how to minimize them.
2 What is unbundling?
In the context of legal services, the term 'unbundling' is used to describe provision of discrete acts of legal assistance under a limited retainer, rather than a traditional full retainer where a solicitor typically deals with all matters anticipated 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 McKenzie Friend in certain circumstances.
The essence of unbundling in its purest form is that the case remains client-led so the solicitor does not necessarily 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 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.
2.1 Areas of law where unbundling may be appropriate
The following is a non-exhaustive list of areas of law where it may be appropriate to offer unbundled legal services. The list is illustrative only, and in all cases practitioners should consider the appropriateness of unbundling in relation to the complexity of the case, the client's needs, and their ability to benefit from unbundled services.
As a general statement we suggest that unbundling may not be appropriate where alternative sources of funding, such as legal aid, trade unions, legal expenses insurance or conditional or some other contingent fee arrangements, are available.
- Small personal injury claims:
- Assistance to draft claim form
- Advice on small claims procedure
- Advice on quantum
- Advice and assistance with regard to defending small claims
- Actions against the police
- Consumer claims and general civil disputes
- Family law:
- 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 provided that the limits of the retainer are strictly defined and adhered to
- Housing law
- Rent disputes and advice on proceedings the first-tier tribunal (Property Chamber)
- Issues within the jurisdiction of the Leasehold Valuation Tribunal
- General advice on law and procedure
- Assistance with application forms
- Assistance with appeal forms
- Advice on Tribunal procedure
- Tribunal advocacy
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
- failing to explain to the client the extent and limitations of the unbundled services being offered
- 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
One of the key principles that should guide practitioners is the need to express with clarity 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 that cannot be ignored. Therefore, 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 for provision of 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 information or the quality of 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 keep a written record of information provided by the client and the advice you give should be provided in writing subject to the 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 Solicitors  EWCA Civ 1616 concerned the provision of legal advice to a client (the claimant) who intended to provide security (over the matrimonial home) to a third party. The claimant was intending to make this provision in order to assist her husband who was in debt to the third party. The claimant therefore needed independent legal advice to ensure that there was no undue influence being exercised in her decision to provide security, and she went to the defendant firm to obtain this advice. This appeal resulted from the third party acquiring their interest in the property, the claimant sought damages from the firm for negligently having failed to advise her properly in connection with the transaction.
The case concerned the nature of the duty of care to a client in the above circumstances. The trial judge said the claimant had not established her claim for damages, however the Court of Appeal ordered a retrial. In initial advice, solicitor A at the defendant firm advised the clamant in a short five-15-minute consultation (the first half hour was free) not to sign documents relinquishing her interests in her matrimonial property in favour of the third party. Solicitor A then wrote a letter stating that the claimant had received independent legal advice as was required for the provision of the security. However, Solicitor A did not give the client comprehensive advice about the nature of the documents, the consequences of signing the documents and also the risks involved. The court emphasised that such a duty was a important one and not a formality. Solicitor A in providing independent legal advice should have explored and tested the reasoning of their client for entering into the transaction. In this particular case the claimant's meeting with Solicitor A was so short because the claimant wanted to leave early. However, the Court of Appeal noted that solicitor A should have made an appointment to see the claimant at another time to provide the advice properly and make the relevant factual enquires.
The firm's duty was further breached by the fact that another solicitor, solicitor B, went on to facilitate the transaction and issued a certificate stating that the client had received independent advice about the transaction and had the consequences and obligations of it explained to the her and that she understood its nature and exercised her decision without undue influence. In this particular case, solicitor B at this latter stage did not take adequate steps. In fact, he only asked whether the claimant had received advice. However, the claimant's husband, who was with the claimant at the time, said she had and the solicitor took no further steps to test this for himself, despite the certificate requiring him to. In neither scenario did the claimant pay for these services. However, the Court of Appeal noted that she went seeking advice and was not told until the end of her initial meeting of the arrangement not to charge for the first half hour consultation and therefore she impliedly agreed to pay the defendant.
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.
In the more recent case of Minkin v Landsberg  EWCA Civ 1152 the claimant was a client who had previously agreed the substantive terms of a matrimonial consent order on the basis of advice from her previous solicitor. She then instructed the defendant solicitor to draft an order in terms that would be acceptable to the court. The defendant confirmed her advice in writing to the claimant. The claimant who was a chartered accountant and had knowledge of the litigation process , confirmed the defendant had understood her instructions and the consent order was then drawn up for approval by the court. Later on the client experienced problems resulting from the order and sought compensation from the defendant.
The Court of Appeal accepted the retainer was limited to the immediate issues upon which the claimant sought advice and the defendant could not be liable for not advising on broader issues that she had not received instructions on. The judgment is significant as the Court recognised the need to adopt a common sense approach to defining retainers. At the same time it is also a reminder to practitioners of the potential risks of unbundling and the need create clearly defined retainers.
Risk arises where you go beyond the limits of your specific 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. For example, if the agreement does not include negotiations with a third party you should specify this.
Padden v Bevan Ashford Solicitors demonstrates the importance of exercising care and skill for the work that you have been retained to do. In Midland Bank Trust Co Lts v Hett, Stubbs & Kemp (a firm)  3 ALL ER 571 at 583 Oliver J discusses the duty: '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 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.
3.2 Professional conduct
3.2.1 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. It could even by said that in some ways there are greater responsibilities to clients of unbundled services to clearly set out what are your responsibilities and those of your client (see IB 1.2 and IB1.5).
You must also act in your client's best interests. In some circumstances unbundling may not be appropriate, 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.
Even though you may only advise the client on a single occasion, you must still 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.
3.2.2 Professional duty to the court
You must comply with your duties to the court as set out in Chapter 5 of the 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 advocacy section below). 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. 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 have to be revised.
3.2.3 Professional duty to opposing party
You should be mindful of the requirements of Chapter 11 of the SRA Code of Conduct with regard to not taking advantage of third parties.
3.3 Limiting the scope of the retainer
The basic position at Common Law is that where a 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  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  1WLR 1997 and Cawdery Kaye Fireman & Taylor v Minkin  EWCA Civ 546. Although in both these cases the finding on the facts was that the retainer was lawfully terminated, the significance for provision of unbundled services is that you must take care to ensure that 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. This practice note and the annexed client care letter templates should help you to avoid this problem.
You must bear in mind that a contract for litigation services is an entire contract and it is likely that you will need to amend your firm's terms of business prior to offering unbundled services to ensure they permit the delivery of discrete services such as those contemplated by this practice note.
3.4 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.
You must inform your clients of your complaints procedure and their right to complain to the Legal Services Ombudsman.
The main advantage for clients in opting for unbundled services is that it should result in lower solicitor-client 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 may be applied which requires the client to pay 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 for payments on account or holding clients' money.
4.2 Hourly rates
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. 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 and transferred to office account when appropriate (see SRA Account Rules, 2011, rules 17.2-17.5 inclusive and 17.7).
4.3 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.
Agreed fees (often referred to as fixed fees) might be more appropriate for discrete 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.
Agreed fees may also be appropriate for advocacy where this is provided.
Agreed fees must be paid directly into the office account (SRA Accounts Rules, 2011, rule 17.5).
The commercial criteria for setting agreed fee levels are beyond the scope of this practice note.
5 Key points for providing an unbundled service
These key points are based on a client-led model where you assist the client to conduct the matter themselves and you do not act as a representative.
- Unless there are exceptional circumstances, the initial client attendance should take place at your office. This facilitates establishing the client's identity and your assessment of your client's abilities to understand and act upon your advice.
- If you have concerns about your client's ability to understand your advice and/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.
- You must achieve the outcomes concerning conflicts and confidentiality set out in the SRA Handbook.
- 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.
- 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 you advice accordingly or do not advise until the necessary information is provided.
- Where your advice relates to litigation or prospective litigation, you should offer your client appropriate advice regarding potential adverse inter party and further solicitor-client costs risks. The parameters of this advice should be clearly defined. If advice is provided in terms of general principles of civil costs. it should be made clear that this is not tailored to the specifics of your client's case. Cases which involve or are likely to involve substantial costs and/or complex costs issues are less likely to be suitable for unbundling.
- 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.
- You should be mindful of key dates such as expiry of limitation periods, appeal deadlines and compliance with court directions.
- 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. The record should include a list of documents or other evidence provided by the client that is relevant to the advice you have given. You should retain one copy and give the other to your client.
- You should generally retain copies of client documents or, where appropriate, other evidence which is relevant to the advice you have given.
- You must inform the client of your complaints procedure and their right to complain to the Legal Ombudsman.
- 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, although it would be prudent to do so in terms of achieving clarity about the scope of the retainer and limiting risk.
- If you decide that it is in your client's best interests to offer information packs produced by a third party you should ensure you are satisfied as to their accuracy and include a disclaimer regarding the accuracy or appropriateness of the contents.
- You may choose to require payment on conclusion of the interview; this is indicative of the conclusion of a discrete advice event. If so,make sure this is clearly understood by the client at the at the time of making the appointment.
- Download a specimen client care letter for unbundled (limited retainer) civil law services - advice only (Word 22kb).
5.1 Suggested schedule of services provided and not provided
The following is an illustrative only and non-exhaustive list of services that may be offered on an unbundled basis. In all cases practitioners should consider the appropriateness of unbundling in relation to the complexity of the case, the client's needs, and their ability to benefit from unbundled services.
- free use of library and/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
- explanation of the court process and nature of court proceedings
- advocacy for a specified hearing
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
- preparation of a costs budget
- progressing the case - that is up to the client
6 Unbundled representation at court
You may wish to consider providing 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 provides. Thus the issues discussed above in relation to obtaining sufficient information from your client apply 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 stray into the territory of negotiations with a third party and, potentially, the need to instruct expert witnesses. Thus there is a risk that an unbundled retainer for advocacy will not look dissimilar to a traditional full retainer. Therefore 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 themselves. Failure to do so may result in your 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 can 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. Download a specimen letter to the judge (Word 17kb).
Where the court has directed that a bundle should be lodged for a hearing, it is difficult to see how an advocate can 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 and/or your client in cases where the client has failed to prepare a bundle or it is inadequately prepared. In view of these risks, where a bundle is required you should consider the inclusion of checking, 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 appropriate as a matter of courtesy that your client's opponent is made aware of that you have been instructed as an advocate for the hearing. You may wish to 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, 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 an alternative to traditional advocacy you may wish to consider providing your client with a professional McKenzie Friend service in appropriate cases.
The role of a McKenzie Friend is to provide advice and support to a litigant in person during the course of a hearing, but a McKenzie Friend has no right to address the court, save for exceptional circumstances where the court sees fit to grant leave.
Further information about the role of McKenzie Friends in the civil courts can be found in the Practice Guidance dated July 2010 by the master of the rolls and the president of the Family Division.
A suitably trained paralegal member of your firm could enable you to provide a McKenzie Friend service for a modest fee compared to the cost of providing advocacy at the hearing. As with other services described in this practice note, you must clearly define the limits of the service, and address considerations such as your client's ability to benefit from the service.
6.3 Advocacy fees
Whether you opt for fixed fees or hourly rates, 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 each hearing which 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'. We suggest that the latter, which can take place in your client's 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 appropriate experts and how to instruct them.
- You should advise your client as to any potential costs liability to another party and their prospects for recovering costs from the other party.
- Download a specimen client care letter for unbundled advocacy services (Word 22kb).