Winter is closing in. Here in the Midlands we have been under the threat of deluge for weeks. The only thing more common than flood warnings are the German sausages being enthusiastically chomped down by visitors to Birmingham’s Christmas market. And, as is increasingly the case, many colleagues here at the Legal Ombudsman (LeO) are taking advantage of the flu jabs on offer in a bid to ward off the latest strains currently putting our friends in the southern hemisphere through their paces.

Of course, the flu virus adapts every year and keeps scientists on their toes as they look to anticipate its next evolutionary jump. Pre-emptive measures are taken each year in the hope of negating these mutations. Evolution is hard-wired into us all and we have been undergoing our own evolutionary adaptations recently here at the LeO in the form of our scheme rule changes. Our consultation regarding the amendments to the rules came to a close in June and we have since published the proposed revisions. We now await the formalities of parliament to make them law.

At the heart of what we are proposing is a desire to future-proof against changes in both the legal market and our jurisdiction. The legal services industry is an increasingly competitive, even aggressive market. The introduction of alternative business structures, the growth of online services, and increasingly competitive pricing to address the demand created by diminishing access to legal aid – all these things are changing the game.

For consumers, there are new risks and we need to ensure we are flexible in being ready for the inevitable complaints that subsequently manifest themselves. There are also practicalities that need addressing now we have the benefit of two years’ operational experience.

One such practicality was the removal of ‘free’ cases. This change was in fact largely supported by respondents to our consultation, including the Law Society, CILEx, the Council for Licensed Conveyancers and, significantly, consumer groups. On the face of it, the rationale behind free cases no longer applies since we have demonstrated that, where firms handle a complaint reasonably, we will waive fees.

In fact, we found that we waive more fees than we had originally anticipated. Our modelling for this was based on other ombudsman schemes and so we estimated that we would waive fees in 10% of cases; however, for the 2011/12 financial year we waived around 35% of case fees. This suggests that more firms are following reasonable first-tier complaints procedures than we initially expected.

Practicalities resulting from jurisdictional changes have also been accounted for in the new scheme rules. Ministers announced in September that complaints about claims management companies will be considered by the LeO. We are in the hands of government officials in deciding when we begin to take these complaints, but we wanted to take the opportunity to make sure that our scheme rules anticipated this happening. Certainly, the decision to allow complaints from prospective customers will be important in dealing with a claims management industry not notably shy of engaging in aggressive marketing techniques.

One key change – increasing time limits for making complaints to six years since the act or omission or three years since the date of knowledge – was made much more with ABSs in mind. With the increasing moves towards the fusing of legal and other professional services, there was evidence that more and more consumers were unsure which ombudsman to complain to, so it felt important to harmonise our timescales with those of what is increasingly our key colleague, the Financial Ombudsman Service. And the new £50,000 financial limit will make the LeO a more viable alternative to the courts. Some consultation respondents felt that resolving complaints through the ombudsman would be more straightforward and probably cheaper than a court case.

One suggestion made to us that failed to get through was the taking on of third-party complaints. Despite support from the likes of Which? and the Solicitors Regulation Authority, our board felt that more evidence was required to put the wheels in motion. We will work with stakeholders to create a specimen list for further consultation on the matter. In principle, at least, we think there may be specific circumstances where we would be able to look at complaints from third parties – remortgaging is one such example – but we obviously need more data to support this view.

The following case studies give an idea of the sort of complaints we have seen, which, for one reason or another, meant we had one arm tied behind our backs when trying to deal with them.

Time limits

Mr A bought a house with a loft extension and a new garage. He lived there happily for five years before work circumstances meant he needed to move to another part of the country. It was only when he started to make plans to sell the property that he discovered the lawyer had not undertaken a thorough search at the time of buying it. In fact, the building did not meet building regulations and there were substantial problems with a loft conversion. Mr A wanted to complain but he thought he would get the issues resolved first of all. Once he had got the stress of selling the house out of the way he would bring his complaint to the LeO.

Unfortunately, Mr A did not manage to sell the house until two years later. By the time he approached us he was outside of our current 12-month time limit and we had no choice but to dismiss the complaint.

Financial limits

Mrs B had taken out a litigation case against a builder who she claimed had done a shoddy job on her house extension. She had an insurance policy, which included legal expenses cover. Mrs B understood that this would cover any of the legal costs she incurred. Unfortunately, Mrs B lost her case and received a court order of £37,000. When we looked at the case we found that the firm had not advised Mrs B exactly what her insurance would cover and so she missed the opportunity to compare it with other available insurance policies. Worse still, the firm failed to tell Mrs B at which point her costs were about to exceed her insurance cover, meaning she lost the chance to decide whether or not to continue with the case and risk incurring additional costs.

An ombudsman decided that the firm should refund Mrs B £30,000 – currently the maximum financial award we can make – but acknowledged that he would have awarded the full £37,000 if our financial limit had allowed it.

Prospective customers

Mr C was awarded legal aid to pursue custody of his children following a divorce. After receiving confirmation of the legal aid support he was then contacted by a firm which appeared to be trying to take on his case without his permission. Mr C had not had any initial discussions with the firm and so was surprised that it knew about his situation.

After an initial discussion Mr C decided he did not want to use the firm and told it. Despite this, the firm sent him some forms to complete so that it could take his case forward. Mr C ignored the paperwork and thought nothing more of it. After all, he had not signed anything.

Unfortunately, the firm continued to harass Mr C by phone and email, urging him to complete the paperwork and return it so that it could start proceedings. Mr C decided enough was enough and decided to raise a complaint with the LeO. However, our current rules regarding prospective customers meant we could not accept it.

Effective service

There are many more cases like these. And every week technicalities with our scheme rules mean customers who have received a poor service might not be able to get redress. I hope that our revisions will help us to keep up with developments in the legal market and maintain an effective ombudsman service. This is essentially a heads-up to the profession because lawyers will need to be prepared when the changes come into being.

Such is the pace of change being caused by the 2007 Legal Services Act, we have had to think long and hard about what might be round the corner. With our next revision unlikely to take place for two years or so, I will in the meantime scrutinise the industry’s evolution with the enthusiasm of a flu-studying scientist.

Adam Sampson is chief ombudsman