Referral Fees: A Short Note on the Politics of Professionalism

One of the interesting subplots of the referral fee ban is the professional politics of it. The position of the Law Society is particularly interesting. They are vigorously supporting a ban but I doubt whether they are really speaking for the profession as a whole. One of the things that strikes me most forcefully about the referral fee debate whenever I see it close at hand is how strongly it is split along commercial and market sector lines. Big firms, and specialists it seems to me, tend to support referral fees: small firms and generalists don’t. Big firms, up to a point, can lobby for themselves and may (I surmise, or perhaps provoke, and certainly generalise) regard the Law Society as something of an irrelevance whereas the smaller firms look to the Law Society for help. If I may surmise again, it may be these firms that take more of an interest in Law Society Council Meetings and elections. Whatever the rights and wrongs of any particular position on referral fees (I’m sceptical about a ban myself, but can see the force of many complaints) the Law Society cannot really claim to speak for the profession. They speak for a particular section of the profession: numerically significant if one counts them as firms – less sizeable a constituency if one things in terms of solicitors, market share and clients represented. It’s important to remember this point, I think, when listening to the professions views on a whole range of topics: PII, legal aid tendering and referral fees to name but three. The Law Society may not often appear riven by doubt, but the profession is often riven by difference. They are, interestingly, often too gentlemanly to say so – but the differences are there. This gentlemanly silence is doubly interesting given that all sectors of the profession pay for this lobbying activity and do so (I think it is still correct to say) predominantly through their practising certificates. Keeping its most vocal and unhappy constituency happy may be a good short-term plan for the Law Society but it may be storing up longer term trouble.

2 thoughts on “Referral Fees: A Short Note on the Politics of Professionalism

  1. Richard, your thoughts accord exactly with mine; and, I have to say they match the views of an increasing number of commercial lawyers who I speak to in connection with the various titles I write for. With no disrespect to the individuals personally, I feel that the line being advanced- by the Law Society is unbalanced, precisely because it does not represent the full range of views, including those of business lawyers, and the in-house community.

    You mention gentlemanly silence; can it be no accident that the press statements come from the Chief Executive, who has been remarkably vocal on a number of fronts, including an astonishing attack on the ABI and a more restrained riposte at Lord Justice Jackson, rather than the President, A&O’s John Wotton? His predecessor was not backwards in coming forwards, whereas for a number of reasons, I suspect a City lawyer is right to be rather more circumspect, given his constituency largely approves of Jackson and advises the insurance giants who his Chief Executive regularly takes to task.

    The time when commercial lawyers should be able to direct the representative element of their PC fee to bodies like FOIL or the CLLS must be close at hand.

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