XN000022-1997-01-07 — Page 7

Myth 3

Fact 3

Myth 4

Fact 4

Myth 5

Fact 5

6.

It is reasonable to charge higher fees for more expensive properties, since this reflects the facts that more experienced lawyers deal with more expensive properties, and that the risk involved is higher.

It is not true that more experienced lawyers always handle the more expensive properties. For example, in a small firm of solicitors, the same lawyers may handle all conveyances.

The risk of having to compensate a client for negligent work is covered by insurance under the Solicitors Professional Indemnity Fund. The contribution made by a solicitor to that fund is not based on the value of properties handled.

If scale fees are too high, the answer is to adjust the scales and review them regularly.

Scale fees are objectionable in principle, since they prevent price competition and are unfairly based on the price of the property involved, not on the value of the work done.

Even if the scales were adjusted in the light of current property prices and solicitors overheads, they could become unfair within a very short time because of the volatility of the property market.

Even though the scale fee for a particular transaction may not reflect the value of the work done, the scale operates in such a way that the total fees earned by solicitors are a reasonable return for all the work done.

That may be the theory behind scale fees, but the theory is unsound.

No satisfactory formula has been devised for setting the fee scales.

There is no reason why solicitors should be guaranteed a certain level of income.