CILEX raises concerns over planned Legal Ombudsman fees

The Legal Ombudsman (LeO) has announced plans to implement tiered case fees that could see legal firms liable for costs up to £1,500. CILEX, the Chartered Institute of Legal Executives, has voiced concerns that these changes might push firms to pay out for spurious complaints to sidestep higher expenses. Currently, if a complaint is upheld against a lawyer and they have not made reasonable efforts to resolve it initially, LeO imposes a charge of £400. The proposed changes would introduce fees of £200, £750, or £1,500 depending on the resolution stage of the complaint. If a case favours the lawyer or is dismissed by LeO, no fee applies.

In its response to LeO’s consultation, CILEX acknowledges the rationale behind a ‘polluter pays’ approach intended to improve complaint handling but is apprehensive that the tiered fees might encourage firms to settle dubious complaints instead of defending against them. While members view the £200 early-stage fee as reasonable, they believe the £750 fee for post-investigation resolutions is excessive. Additionally, the £1,500 charge post-ombudsman decision must “demonstrate the value for money of the charge” to be justifiable.

CILEX supports the idea of complainants proving evidence of detriment for complaints to be considered, aiming to reduce frivolous claims. However, the organisation opposes imposing a requirement for serious detriment, as this could dismiss minor yet valid complaints. While they agree with a 12-month time limit for filing complaints, they advocate for extending the proposed 12-year long-stop to accommodate those affected by poor service related to wills or property advice.

The publication of final decisions has been welcomed by CILEX, which believes it would “encourage transparency and better consumer choice, whilst also acting as a deterrent for poor service or complaints handling from providers.” They insist that once implemented, the rules regarding the complaints process should remain consistent and not subject to revision based on fluctuations in demand.

Sara Fowler, President of CILEX, stated, “CILEX agrees that those firms providing a poor service and failing to resolve legitimate complaints at an early stage should bear the financial burden of resolving them. That said, CILEX has concerns about firms being driven to make unwarranted payments over fears that a complaint going to the ombudsman will prove even more costly." Fowler further added, “While we expect the proposals to reduce the number of unmerited and vexatious complaints, it is important that we ensure more minor complaints still get a fair hearing and that consumers have the right to complain, even when issues with the service provided do not come to light until many years after the event.”