The Legal Services Board (LSB) is the independent body responsible for overseeing the regulation of ‘lawyers’ in England and Wales. It has recently measured average prices being charged by ‘law firms’ (these are not always Solicitors) for common services such as Will writing, Probate applications, estate administration, Powers of Attorney and divorce.
1,500 law firms were interviewed (we weren’t and the figure represents less than 1% of all Solicitor firms), 90% (of the 1%) of whom were Solicitors and the other 10% included licenced conveyancers, accountancy firms, unregulated Will writing firms and other unregulated legal service providers – yes they really do exist. The survey found (like Family Fortunes) that average charges across all responding firms were as follows – a standard Will £168, a complex Will £206, Lasting Power of Attorney £414, an application for a Grant of Probate £829 and an estate administration £1,926. Fixed fees were found to be usual for Wills and Powers of Attorney but became less common as matters as become more complex.
Fees did not seem to be determined by the size of the law firm but interestingly it did emerge that firms in the South East of England charge significantly higher prices than elsewhere in all of the service categories. People of London and the South, you are welcome in Shropshire!
Benchmarks exist to give people information about average prices but there is no mention in the survey of the service level provided, client satisfaction, expertise, regulation and insurance.
Do you generally make important purchases on the strength of price alone?
For prospective new clients, questions about how much we charge are usually near the top of the list and we understand this, to a point. Until recently one local law firm made no secret of the fact that they would undercut any other local firm’s price. They were cheapest in town and proud. Sometimes their advice was not given by experienced or even qualified staff. This firm is no longer in business.
So how will you decide to come to us? Very often it will be on the recommendation of someone else we have helped, or a professional adviser like your accountant or financial advisor. We really appreciate all the referrals and recommendations that we get. They are the best of introductions.
We understand that people need to know quickly how much our services and advice are likely to cost. This is quite different to shopping around and buying on price alone. Sometimes the traditional Solicitors reputation goes before us so people think that we are going to be very expensive. We aren’t a product and it can be difficult to understand what you are getting for your money. Questions about whether we are actually paid the hourly rate that we charge our clients are common. We aren’t! The hourly rate covers all the staff wages, the offices, all our outgoings, our professional insurance, our compulsory training, our legal precedents and much more. The list is very long!
Fixed fees can be agreed for a fixed scope of work and we can work for fixed fees. On occasion we have lost work to other law firms who have agreed early fixed fees where we have been more cautious. We know ultimately that the client has ended up paying more than we would have charged. It can be very frustrating.
Pricing for probate is tricky. What is involved and how much do you want us to do? We understand that it is difficult to deal with legal formalities when you are bereaved and this is a particularly sensitive time to be forming a client relationship.
You can apply for Probate personally, you do not need to use a solicitor. Recently shared statistics from the Liverpool Probate Registry revealed that 40% of Probate applications they receive are now made by individuals and 60% are made through solicitors. 10 years ago those figures were 30% and 70% respectively. So while we may still be the Probate Registry’s largest customer, people are feeling more confident and able to make Probate applications themselves.
Our advice is not just about administrative support, we will suggest ways of making things more tax efficient and secure for the beneficiaries. A good Solicitor does a lot more than just fill in forms. None of us know what we do not know.
We sometimes put our fees in context against other death related expenses, but with some clients this does not help.
At two recent and separate meetings with widows both were incredibly anxious about how much our fees would be. In the first case we asked about the funeral expenses. We were told that the deceased had had the ‘cheapest funeral’ available. This had apparently cost in the region of £3,500.00. The client’s expectation was that we would react immediately to all her demands and do exactly what she asked (whether this was consistent with the Will or not).
We went on to describe our work in detail and the necessity and benefits of us doing it. We reassured her that this (not a small amount of) work (for which we are insured and would have ongoing liabilities) would be far less than the cheapest funeral, and less than £2,000. After we had spent a couple of hours with this lady without any charge she then went somewhere else – apparently cheaper.
In the second case there was a similar concern about fees which seemed to be make or break from the outset. This time the deceased had not had the cheapest funeral possible. In contrast here the widow had not even enquired as to the cost of the funeral before committing. We outlined the work that would be involved and estimated minimum fees of £1,500 plus VAT. The widow thought this was too expensive and decided not to instruct us. We were sorry as we thought we could have really helped.
We are unlikely to know whether in several years’ time someone will be telling these ladies children that it would have been much better if their mother had done something different when their father died. Advice about saving inheritance tax, liability if things go wrong, safeguarding assets from care fees payable by the surviving spouse, and children who need protecting from themselves….or their spouses, is not the same in all cases and this advice is not freely and meaningfully available on the internet.
Our recent analogy between the costs of our advice to administer an estate and funeral costs did not persuade the clients. Why is this? Solicitors seem to be very misunderstood!
In the same month that the LSB reported on average fees for legal work, The Times reported that MPs had decided to refer the funeral industry to the competition watchdog. The article led with the title “Resting in Peace has Become a Pricey Business”.
In our examples above the people were prepared to pay significant fees to undertakers – a business with no national standards for training or contact and where pricing is often unclear. Unlike Solicitors who are highly regulated, there is no independent regulation of funeral directors or avenue for redress in the case of complaint. The Times reported that catteries are more regulated than funeral parlours.
Funeral costs have been rising fast and it is quite usual to see basic funerals costing between £3,500.00 and £4,000.00. The cost of funerals has risen by 80% over a ten year period and this trend is seen as one that will rise. Only a small proportion of people have taken out prepaid or insurance policies to cover the costs of their funeral. In its article The Times reported that the one million people a year take out a payday loan to fund funerals for loved ones. A mother told the House of Commons Work and Pensions Committee that she had to freeze her son’s body for several months whilst she saved up for his funeral. Who would have even though that this was an option?
We are fortunate in Shropshire to have some excellent undertakers who are working to the highest standards in supporting bereaved families. We do not begrudge them their reasonable fees. We would like clients to understand that we too provide a valuable service which involves care, compassion, support and valuable advice – often over quite a long period of time.
Undertakers generally have been sent a clear warning shot by MPs to improve standards and be more transparent about their fees. The competition watchdog is going to examine the dominance of both Dignity and Co-operative funeral care (who will signpost you to Co-op Legal to help with probate) within the industry. Some independent undertakers are not as they appear and there should be an independent regulatory body – a bit like solicitors have had for years. Increased standards and regulation in the funeral industry will probably be cited as reasons for funeral costs to rise yet further. It may end up like the dispirited legal profession!
Death is not a regular business and consumers are often vulnerable. It is not a time when the bereaved should not be taken advantage of. We know we can help and we would like to. We will charge a fair price for a good job. ‘Cheap’ will be from the firm that won’t be around in a few years’ time when your beneficiaries need them.