SPOTLIGHT: Why it’s time to regulate the UK’s unlicensed evictions specialists

admin    Uncategorized     agents

In the UK anyone offering a specialist eviction service can operate as as a solicitor or firm licensed by the Solicitors Regulation Authority (SRA). Or it can operate without that stamp approval, albeit without the legal authority to complete many parts of the process.

This has created a grey area into which many unlicensed firms, many calling themselves ‘lawyers’, have leapt offering cut-price services that often fail to deliver the same level of service or competencies as a licenced operation.

This grey area exists because the SRA’s remit means it can only deal with the actions of those solicitors or the firms they run under the Solicitors Act 1974.

And even if an unlicensed firm employs an in-house solicitor – which many do – they still cannot provide ‘reserved’ (see definition below) activity through organisations that the SRA does not regulate.

What does reserved mean?

---

The SRA told LandlordZONE: “Our regulation is about protecting the users of legal services who have engaged a solicitor firm. We have no remit with landlords or their agents if those agents are not solicitors.”

There are dozens and possibly hundreds of companies who offer an unlicenced eviction service in the UK, often including the word ‘lawyer’ in their company names or websites who continue unchecked or policed.

“They are easy to spot because they are usually much cheaper than licenced eviction specialists,” says Paul Shamplina, star of Channel 5 TV show Nightmare Tenants, Slum Landlords.

“But all too often we pick up cases from landlords who have gone for the cheap option but who then find out that the paperwork has not been prepared properly and their cases are thrown out by the judge.”

Test case

This situation has been continuing for years, despite a test case in 2018 concerning a possession case in Birmingham (Kassam vs Singh) during which the judge made it clear that he considered the way in which unlicensed companies operate to be unlawful under the Legal Services Act 2007.

As that case also highlighted, procedural mistakes made by unregulated eviction companies can be both costly and waste a lot of time for landlords.

And without the indemnity insurance afforded by an SRA licence, landlords have little recourse other than to take the company to court to recoup their losses.

Think carefully

“We advise landlords to think carefully before instructing any firm to carry out possession services to ensure they are working with a reputable company,” a spokesperson from the NRLA told LandlordZONE.

“This should include seeking recommendations through word of mouth and searching for reviews on reliable websites. It is important also to ensure that before agreeing to use such services, landlords understand clearly the costs and what will be provided.”

Little progress has been made towards regulating or licensing the entire sector (rather than just parts of it) since the Kassam vs Singh case.

MoJ register

But official action could be forthcoming. The Ministry of Justice (MoJ) last week told an industry conference that it is considering whether to create a register of unregulated providers of legal services and give their clients access to redress if things go wrong.

Peter Rowlinson, head of UK legal services policy at the MoJ said that it doesn’t make sense that while the client of a lawyer advising on a will, for example, had the protection of both regulation, indemnity insurance and access to the Legal Ombudsman, the client of an unregulated provider did not.

In the private rental market, this issue of parallel ‘legal services’ provision is particularly pressing because many more landlords will soon be seeking help as they attempt to remove tenants who have defaulted on their rent before, during or after Covid.

Tim Frome (right), Head of Legal at Landlord Action, also says some of the cases he deals with involve letting agents who claim to have the in-house expertise to complete evictions but which in reality do not, or who use an unregulated specialist, in both cases in the hope of making extra revenue.

LandlordZONE put this to ARLA Propertymark, but it declined to comment.

“We are seeing clients come to us after using an unlicenced evictions specialist which has ended up making their situation worse after they have made basic procedural legal mistakes or, in some worse-case scenarios, blatantly lied to a landlord about their capabilities and the progress of the eviction,” says Frome.

“It is then left to licenced companies like ours to unpick the mess after the landlord has realised often too late they may have to go back to square one after months of unnecessary waiting and expense.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – SPOTLIGHT: Why it’s time to regulate the UK’s unlicensed evictions specialists | LandlordZONE.

View Full Article: SPOTLIGHT: Why it’s time to regulate the UK’s unlicensed evictions specialists

If you enjoyed this article please consider sharing it!