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Those in favour of retaining scale fees have said that the abolition of scale fees will lead to a vicious price war, in which fees will drop below an unprofitable level and solicitors will produce shoddy work. There is no empirical evidence to support this assertion. And just analyse what is being said. It is that solicitors, whose professional training and discipline are said to justify their monopoly over conveyancing work, cannot provide proper and professional conveyancing services unless their fees are artificially fixed by reference to the price of the property conveyed. That is an astonishing argument for a profession to put forward and is untenable.
Some have pointed to the fact that Singapore has decided to retain a modified form of scale fees for conveyancing. They argue that Singapore's background is similar to that of Hong Kong. However, in Singapore only a relatively small segment of the population own or intend to acquire private housing. 87% of the population live in flats provided by the Housing Development Board, which provides legal services for sales, purchases and mortgages of those flats. The two places are not therefore comparable in respect of their housing markets.
The Law Society has also referred to the abolition of scale fees as "the English experiment". This is misleading. Scale fees have been abolished not only in England, but also in New Zealand, Canada and most parts of Australia. Moreover, the Administration is not aware of any place that has abolished scale fees and has subsequently re-introduced them.
If scale fees are abolished, solicitors will be required to charge conveyancing fees that are fair and reasonable "having regard to all the circumstances of the case". Consumers will therefore be charged on the basis of the work done, not on the value of the property concerned. This will improve the efficiency and cost-effectiveness of conveyancing services. The quality of the services provided depends on the expertise and professionalism of the solicitor concerned. Scale fees do not guarantee quality, and the abolition of scale fees will be no excuse for poor quality. The solicitors are members of a profession and must observe professional standards. The Law Society has a duty to discipline any of its members who fail in this respect. Other professions, trades and industries can provide quality services without price fixing, and there is no reason why solicitors cannot do so.
It has recently been suggested that the abolition of scale fees would undermine the independence of the legal profession. This Bill does not do that. No one is seeking to interfere with the way in which legal practitioners do their work. But it is quite legitimate for the legislature to step in and remove a pricing arrangement that is anti-competitive and unfair to consumers. Moreover, the monopoly that solicitors have in respect of conveyancing is conferred by legislation. The legislature is entitled to amend that legislation to prevent price-fixing in respect of conveyancing.