On Monday 23rd September 2013 I attended a Special general Meeting of the Law Society of Scotland at which we debated a motion put forward by its Regulatory Committee. As a few of us found out on the night, the motion was not in practice a simple yes / no vote on Sep Rep. The Regulatory Committee had included in its motion a draft change to the current conflict of interest rule which allows a solicitor to represent both a borrowing client and a lending client in the same security transaction. The effect of the change would have been to put an end to joint representation in all cases, no exceptions.
However, the motion was couched in such a way as to say: "here is what we are thinking: we need more time to think about it and possibly consult: what do you think?".
Once we managed to get our heads around the fact that irrespective of whether we voted for or against the motion, the Regulatory Committee would still be able to come back with another draft rule to the same end, the debate was reasonably engaging.
In the end the motion was defeated by 847 votes to 671, which included a large number of proxies.
Whether the majority of around 56% against 44% is a big enough steer to the Regulatory Committee to drop the whole notion of Sep rep remains to be seen. The Council of Mortgage Lenders (CML) seem to think so, judging by their press release. The next opportunity for the Regulatory Committee will be the Law Society of Scotland's AGM in April 2014, though hopefully we will get a steer a bit before then as to whether it is now dead in the water.
Some interesting points from the debate:
1) The CML reaffirmed their commitment to work with the Law Society on reviewing the approach taken by their members to so called "minor" breaches of their Lenders' Handbook which might not in themselves evidence negligence on behalf of the solicitor.
2) Statistics indicating that 77% of recent "CML related" claims against the Master Policy relate to firms which are no longer trading.
3) Strong evidence that a significant number of solicitors were voting in favour of the motion out of self-interest, rather than with any heed to the "conflict of interest" issue.
For those who see the "conflict of interest" issue in joint representation as the essence of the matter, there was a timely reminder that the current rule does, of course, prohibit joint representation where such a conflict does exist.
Almost, but not quite, checkmate.