The Law Society has called on the Legal Services Commission to extend existing family contracts until April 2012, following Chancery Lane’s successful High Court challenge to the family tender process.

However, some firms that did win family contracts through the tender process are now understood to be considering seeking compensation from the LSC if it fails to overturn the result.

A week ago Lord Justice Moses found in favour of the Law Society, ruling that the LSC’s process for awarding new family contracts was unlawful, effectively quashing the outcome). The tender would have reduced the number of family providers from 2,400 to 1,300.

Moses said the LSC’s failure to give adequate notice of the selection criteria meant it had ‘arbitrarily and unfairly’ distinguished between providers, and deprived some of those most in need of the opportunity to obtain the services of experienced family lawyers.

He said the failure to give notice was ‘irrational’, and defeated the LSC’s own objective of obtaining high-quality services from the best-qualified lawyers. The LSC was ordered to pay the Law Society’s legal costs of around £300,000.

LSC chair Sir Bill Callaghan said the LSC was ‘disappointed’ by the result and is considering the judgment and whether to appeal. A statement on the LSC’s website said it was conscious of the uncertainty for providers, and would publish further information in due course.

The current contracts are due to expire in November, having been extended for a month. Meanwhile, the government is currently considering cuts to legal aid as part of its spending review, including proposals to restrict legal aid in private law family cases.

A Law Society spokesman said: ‘The Law Society has requested that the LSC extend the original contracts until April 2012, and await the outcome of the government's spending review, to devise a new tender process that fits with where we are today.’

Roy Morgan, director of the Legal Aid Practitioners Group, said: ‘Extending the family contracts until after the spending review is sensible because it will dictate what happens, regardless of the judicial review’.

However, he added that this would mean the old contracts for family work will be running at the same time as new social welfare contracts, creating a problem.

Commenting on solicitor reaction to the outcome of the judicial review, Morgan said: ‘Those not given contracts are pleased, but a lot of firms that were awarded contracts and who made preparations based on that have now been left in limbo, and some are considering compensation claims [against the LSC].’