Lord Neuberger questions the ethics of ABS

By Chloe Smith » Supreme Court president Lord Neuberger has warned that alternative business structures and conditional fee agreements are two ‘concerning’ developments that could pose a threat to lawyers’ ethical duties.

Giving a speech on ethics and advocacy at the Royal Courts of Justice last week, Neuberger said the risk of a ‘conflict of interest’ within an ABS was obvious.

He said: ‘The investors will often have no interest in lawyers’ ethical duties and will ultimately only be concerned with the bottom line.’

Similarly, he said contingency fee arrangements and success fees also increase the scope for a conflict of interest, as they give advocates and lawyers a financial interest in litigation.

He said: ‘One must … be concerned with a change that could increase the chance that a lawyer wouldn’t comply with their ethical duties.’

He added: ‘If you really believe that lawyers should not be placed in a position where they have conflicting interests then the case for success fees [seems] shaky.’

But he admitted that these fee arrangements did help improve access to justice. He expressed the hope that lawyers’ commitment to high ethical standards was ‘sufficiently robust’ to resist the temptations conditional fee arrangements and ABSs generate.

Neuberger also warned that the high level of regulation in the legal profession could lead to an ‘attractive culture’ being replaced by a ‘box-ticking’ exercise.

He stressed that because professional ethics cannot be reduced to simple rules, regulators are pressured to publish increasingly complex requirements.

Instead, Neuberger suggested that lawyers should be taught more about their ethical duties while training.

[Courtesy: The Law Society Gazette]