An Ombudsman’s view of good costs service

The Legal Ombudsman (LeO) costs guidance has recently been updated to ensure that legal service providers are aware of the importance of providing clear costs information to customers throughout their legal transaction; from the initial costs information through to changes in costs and the final invoice.

Consumers use lawyers at some of the most difficult times in their lives such as buying a house or getting a divorce. Given that there is a perception that legal service providers are expensive, it’s no wonder that consumers can be cautious about how much they are paying.

The overall advice we give at LeO is that a customer should never be surprised by the invoices they receive from their service provider. Our guidance looks at a range of areas and examples of complaints we have investigated in recent years.

Here are some of the areas we highlight.

Is your charging structure clear and understandable to consumers?

As well as understanding how they are going to be charged, it is important that customers understand the disbursements that are included in a fixed-cost or initial estimate, and therefore what might be included later if circumstances change. For example, understanding the standard searches that are covered in a conveyancing transaction and the specialist ones that are not.

When there are different funding options, how carefully are they explained? 

There are times when a customer may have the option of funding their case through an insurance policy, union membership or legal aid. Where these are options, we will look for evidence to see if this has been discussed and customers understand the implications of these arrangements.

Are you clear with customers about the different options in their case, and the potential cost implications?

We see many cases, for example in family litigation and wills and probate, where customers may have options about different ways to proceed which could have a significant impact on their final invoice. When we investigate these cases, we are looking for evidence that shows they have received information which enables them to make a choice.

Do you provide a reasonable estimate?

We know that an estimate is just that, and don’t expect it to be a completely accurate reflection of the final cost. But we do expect that customers receive a reasonable estimate based on the information available at the time.    

How often do you review cases and update your estimates?

Following on from above, we appreciate that situations change which has an impact on the costs. We would expect service providers to keep estimates under regular review and to tell customers if circumstances mean that the estimate needs revising.

This article was written by Alex Moore, Stakeholder and Public Affairs Officer at the Legal Ombudsman