Unregulated legal services: Consumer protection law guidance

Published 9 October 2024

https://www.gov.uk/government/publications/unregulated-legal-services-consumer-protection-law-guidance/unregulated-legal-services-consumer-protection-law-guidance

Summary

Unregulated ^{[footnote 1]} businesses are an important and growing part of the legal sector. It is estimated that there are at least 3,800 unregulated businesses providing legal services in England and Wales alone, with the largest number in the area of wills and estate administration.^{[footnote 2]} Many unregulated providers offer services that are innovative and convenient for consumers, and that are less expensive than the services offered by regulated providers.

The purpose of this guidance is to help unregulated businesses offering will writing, online divorce, and pre-paid probate services to consumers in the UK to understand and comply with their obligations under consumer protection law.

In England and Wales, Scotland, and Northern Ireland, only certain legal services are restricted to regulated legal services professionals. Other ‘nonreserved’ legal services may be legally offered by unregulated businesses.

In the context of unregulated will writing, online divorce, and pre-paid probate services, failures to comply with consumer protection law are particularly likely to give rise to significant consumer harm. That is because:

these are infrequent purchases, and involve complex legal concepts and terminology with which consumers may not be familiar
these are important services which are likely to have serious and long-term consequences for consumers
consumers often purchase these services at a challenging and stressful time of their lives when they may be more vulnerable to misleading or aggressive sales practices
the nature of these services is such that problems may not come to light until many years after the initial purchase is made
consumers who purchase legal services from unregulated businesses cannot necessarily access the same complaints processes and redress mechanisms available to consumers who purchase from regulated businesses ^{[footnote 3]}

By ensuring their practices are consistent with consumer protection law, businesses can mitigate the risk of harm to consumers, minimise the risk of enforcement action being taken against them, and support trust in unregulated legal services generally.

Consumers who have accurate information about all of their options for legal services are able to make informed purchasing decisions, which drives competition and ultimately leads to lower prices, higher quality, and greater innovation.^{[footnote 4]}

This guidance follows the following structure:

chapter 2 explains the scope of the guidance, and whom it is intended for, the relationship between this guidance and other law, regulation and guidance, what businesses need to do to comply with consumer protection law, and the consequences if they do not do so
chapter 3 sets out the CMA’s views on the most important consumer protection law requirements which apply to providers of unregulated legal services. This Chapter explains how businesses can ensure that:
- consumers have the information they need to take informed decisions
- terms and conditions between providers of unregulated legal services and consumers are fair
- services are performed with reasonable care and skill
- sales practices are not misleading or aggressive, or otherwise contrary to statutory obligations
chapters 4 and 5 set out how these obligations may apply in practice to providers of will writing and online divorce services. These Chapters include practical ‘do and don’t’ checklists and case study examples
chapter 6 discusses pre-paid probate services

Introduction

The CMA’s mission and powers

The Competition and Markets Authority (CMA) is the UK’s primary competition and consumer protection authority. The CMA’s objective is to make markets work well for consumers, businesses and the broader economy.

The CMA has powers to tackle practices and market conditions that harm consumers and hinder their decision making. The CMA uses its consumer protection law powers to protect consumers from unfair business practices and unfair contract terms.

The CMA can go to court to enforce consumer protection law. In addition, when the relevant provisions come into force^{[footnote 5]}, the Digital Markets, Competition and Consumer Act 2024 (DMCC Act) will give the CMA powers to determine whether consumer law breaches have occurred, and to impose fines and order firms to pay compensation to affected consumers.

As part of its role, the CMA produces compliance guidance for businesses to clarify their consumer protection law obligations and to promote compliance.

What does this guidance cover?

The purpose of this guidance is to help unregulated businesses active in providing will writing, online divorce and/or pre-paid probate services to understand and comply with their obligations under consumer protection law.

The CMA recognises that unregulated providers of legal services are an important and growing part of the legal sector.^{[footnote 6]} As noted in the CMA’s Legal Services Market Study, unregulated providers may offer more affordable options for consumers, and can act as a starting point for consumers seeking assistance in navigating the market.^{[footnote 7]} In its 2020 review of the Legal Services Market Study, the CMA also found evidence that unregulated providers are often more innovative than traditional regulated professions.^{[footnote 8]}

This guidance is being issued as part of the CMA’s investigation into the provision by unregulated providers of will writing, online divorce, and pre-paid probate services.^{[footnote 9]} For that reason, the guidance is not specifically addressed to either unregulated providers of other legal services or regulated providers of legal services. This should not be taken as a comment on the quality of regulated versus unregulated providers: as noted above, the CMA considers that unregulated providers play an important role in the market for legal services.

Businesses selling to consumers in the UK are required to comply with UK consumer protection law. In the specific context of will writing, online divorce, and pre-paid probate services, consumers are often making purchasing decisions in challenging circumstances, and those decisions are likely to have important and long-lasting consequences. Consumer law provides important protections for these consumers.

The CMA has previously published a number of reports and responses to consultations regarding the legal services market as a whole in England and Wales ^{[footnote 10]} and Scotland ^{[footnote 11]}, which have included recommendations in respect of the regulatory regimes applicable to unregulated legal services. It is important to note that the focus of this guidance is not on regulatory reform, but instead on promoting compliance with existing consumer protection law.

The guidance identifies important consumer protection law requirements that unregulated providers of legal services ^{[footnote 12]} must comply with. It sets out examples of practices or conduct that, in our view, could breach consumer protection law, and sets out some of the practical steps businesses can take to help them comply with the law. While each case will depend on the particular facts, businesses which fail to adhere to this guidance are more likely to break the law.

This guidance is not legal advice, and responsibility for compliance with the law remains the responsibility of each business individually. The guidance is also not a substitute for the law itself, nor does it replace the role of the courts in providing definitive interpretations of consumer protection law when issuing judgments based on the facts of each case.

It is also the responsibility of businesses to ensure that they have familiarised themselves with, and comply with, developments in consumer protection law.

The guidance is not exhaustive. It covers the areas that the CMA considers, at the date of issue, to be the most relevant, but does not cover every situation in which an infringement of consumer protection law may occur. The guidance should be read alongside the CMA’s guidance on, for example, consumer protection from unfair trading ^{[footnote 13]}, unfair contract terms ^{[footnote 14]}, and enforcement of consumer protection law (and any revised or reissued versions of the same).^{[footnote 15]}

Whom is this guidance for?

This guidance is intended for unregulated providers of will writing, online divorce and pre-paid probate services in the UK.

In this context, ‘unregulated’ businesses^{[footnote 16]} are those not regulated by an approved legal regulator.^{[footnote 17]} The fact that a business employs legally qualified staff, such as solicitors, does not take it outside this definition.^{[footnote 18]}

As set out above, this guidance is being issued as part of the CMA’s investigation into the provision by unregulated providers of will writing, online divorce, and pre-paid probate.^{[footnote 19]} As such, it is not addressed to unregulated providers of other legal services, or to regulated providers of legal services.

This guidance may be helpful for consumers who purchase legal services from unregulated businesses. However, it is not primarily intended as a guide to the rights of individuals generally. It does not provide information about contract law as a whole, or about the duties the law may impose on businesses as a result of their specific legal relationship with consumers (for example, the duties owed by an executor to the beneficiaries of a will).

Those involved in contractual or other disputes with businesses are likely to need advice on a broader range of issues than are covered in this guidance. Such advice can be sought from the Citizens Advice consumer service online or call 0808 223 1133.

Alongside this guidance, the CMA has produced 2 short guides for consumers explaining what to consider when buying will writing services and what to look out for when buying divorce services. These documents are intended to help consumers to understand their rights and how consumer law applies in this sector.^{[footnote 20]}

Relationship with other law, regulation and guidance

Consumer protection law sets requirements that apply to various aspects of an unregulated legal services provider’s dealings with consumers. It sits alongside other sector-specific and general legal requirements.

Unregulated legal services providers are prohibited from providing certain ‘reserved’ categories of legal services, and businesses that provide reserved services for a fee in contravention of these rules may commit an offence. This may include, for example, conducting court proceedings in relation to a divorce, or the preparation of grants of probate/confirmation.^{[footnote 21]} Businesses should be aware that the definition of reserved activities is not uniform across England and Wales, Scotland and Northern Ireland.

In addition, individuals involved in the delivery of unregulated legal services may be subject to individual regulatory requirements, even if the businesses they work for are not regulated.^{[footnote 22]} Businesses may also be members of industry bodies or codes of practice, although these may not have the legal force of regulation.

Businesses must comply with their other legal and regulatory responsibilities, and this guidance should not be understood to be a ‘one stop shop’ in respect of unregulated legal services businesses’ legal obligations.

What businesses need to do

Businesses providing will writing, online divorce and/or pre-paid probate services should:

consider this guidance and ensure that they are complying with their consumer protection law obligations
comply with their wider legal obligations and industry standards
consider carefully whether they need to make changes to their practices
make any changes necessary to comply with the law, such as:
- ensuring they give consumers the information they need to make informed choices
- amending their terms and conditions to ensure they are compliant
- taking steps to ensure that services are performed with reasonable care and skill
- ceasing any aggressive or misleading trading practices

If in doubt about what it needs to do, a business should seek its own independent legal advice on the interpretation and application of consumer protection law. Businesses can also speak to their Trading Standards Service for advice, for example as part of a primary authority relationship.

What happens if businesses fail to comply with consumer protection law?

If a business does not comply with consumer protection law, the CMA and other bodies, such as Trading Standards Services, can bring court proceedings. In some cases, businesses may be required to pay redress to any consumers harmed by the breach of consumer protection law and take additional measures to reduce the likelihood of future breaches and to give consumers information that helps them exercise greater choice (together, these things are known as ‘Enhanced Consumer Measures’).^{[footnote 23]}

Further guidance on the CMA’s approach to use of its consumer powers, including Enhanced Consumer Measures, can be found on the CMA webpages.^{[footnote 24]}

Businesses may also face legal action from individual consumers, who can bring legal proceedings in response to a business’s conduct or seek redress in the courts for certain breaches of consumer protection law.

The Digital Markets, Competition and Consumers Act

The DMCC Act received royal assent in May 2024. At the time of publication, the relevant provisions of the DMCC Act have not yet come into force, but the Government expects to commence these provisions in April 2025.

When it comes into force, the DMCC Act will give the CMA powers to determine itself whether consumer law breaches have occurred, and to impose fines and order firms to pay compensation to affected consumers.

The DMCC Act contains broadly similar prohibitions against unfair and misleading commercial practices as are currently contained in the Consumer Protection from Unfair Trading Regulations 2008.

The DMCC Act also introduces some other changes to consumer protection law that will affect some of the issues covered in this guidance. Examples include:

new protections for consumers who enter into ‘subscription contracts’, which are likely to be relevant to will storage and will update products
a specific prohibition on ‘drip pricing’, which is the practice of advertising a price but then introducing further additional fees later in the sales process
new regulations applying to consumer savings schemes, which could be relevant to businesses offering pre-payment products

These changes are explained in greater detail below. Businesses offering unregulated legal services must ensure that, in addition to existing consumer protection law, they comply with any future changes to the law, including as a result of the DMCC Act. They may wish to seek legal advice on how the provisions apply to the specific practices of their businesses.

Consumer protection law obligations: an overview

This Chapter sets out the CMA’s views on some of the most important consumer protection law requirements which apply to providers of unregulated legal services. These include businesses’ obligations to ensure that:

prospective consumers have the information they need to make informed decisions ^{[footnote 25]}
terms and conditions are fair ^{[footnote 26]}
services are performed with reasonable care and skill ^{[footnote 27]}
sales practices are not misleading, aggressive or generally unfair ^{[footnote 28]}

Discussion of how these obligations may apply in practice to providers of wills, online divorce, and pre-paid probate services follows in Chapters 4, 5, and 6.

Ensuring that consumers have the information they need to make informed decisions

Businesses must provide prospective consumers with the information they need to make an informed decision. The information provided must be accurate and not misleading.

Misleading actions and omissions

A business breaks the law if it fails to give consumers the information they need to make an informed decision, causing them to make a different decision or making it likely that they will. This is known as a misleading omission.^{[footnote 29]}

It is also unlawful to mislead consumers by giving them information which is false or deceptive, where that causes them to make a different decision or makes it likely that they will. This is a misleading action.^{[footnote 30]}

This section explains the steps that providers of wills, online divorce, and pre-paid probate services can take so that they do not mislead consumers in these ways.

Avoiding misleading consumers by omission: what information needs to be provided?

Material information

The information consumers need to make an informed decision about whether to buy legal services is called ‘material information’.^{[footnote 31]} It is unlawful to mislead consumers by failing to give them that information at the right time and in the right way.

What constitutes ‘material information’ is likely to vary depending on the specific legal services being offered and the way those services are presented to consumers. When determining whether consumers have been, or are likely to be, misled by a business’s failure to provide information, the circumstances of the omission would be taken into account.

When assessing whether particular information is ‘material’ businesses should ask: is this information that the average consumer would need to make an informed decision about whether to buy the service? If the answer is ‘yes’, the information should be provided.

The material information should be provided to consumers in a clear, intelligible, unambiguous, and timely way, before they make decisions.

In the context of unregulated will writing, online divorce, and pre-paid probate services generally, businesses are more likely to comply with the law if they provide the following information to consumers:

the total price of the service (including VAT, and including any fees charged by third parties), or, where this not possible, an estimate of the total price of the service based on the average price charged for that service and an explanation of the method by which the total price will be calculated
details of any other costs consumers are likely to incur; this could include, for example, any court fees or other charges that are not included within the terms of the contract
a description of the services that will be provided
details of any services which (contrary to a consumer’s reasonable expectations) are not included within the price
details of how the legal services will be delivered, and the likely timescales for delivery
if services are to be provided by a third party, details of the business that will provide them
an explanation of whether the business is regulated by an approved legal services regulator, and whether it is a member of any self-regulatory bodies
details of the level of experience and/or qualifications of the staff involved in delivering the relevant services: this may include, for example, formal qualifications, experience, membership of a regulatory or self-regulatory body, or professional training completed
details of the business’s complaints handling procedure and what (if any) other routes of redress are available to consumers
an explanation of whether or not the business holds professional indemnity insurance
any terms that the consumer might find particularly surprising, or that are otherwise important

Pre-contract information

The law also requires businesses to provide certain pre-contract information in a clear and comprehensible manner.^{[footnote 32]} There is a considerable overlap between information that is likely to be material information and the pre-contract information that must be given to consumers.

The necessary pre-contract information that must be provided includes^{[footnote 33]}:

the main characteristics of the service
the total price for the services, inclusive of taxes (or, where the nature of the services is such that the price cannot reasonably be calculated in advance, the manner in which the price is to be calculated)
the payment and performance arrangements
where the trader is acting on behalf of another trader, the address and identity of that other trader
the duration of the contract, or, if the contract is of indeterminate duration, the conditions for terminating the contract

Additional rules apply in relation to ‘distance contracts’ (for example, contracts negotiated and entered into online or via telephone), and ‘off-premises’ contracts (for example, contracts entered into at a consumer’s home or in a public place). In particular, where a consumer agrees to purchase an unregulated legal service at a distance or off-premises, the consumer should also be informed of ^{[footnote 34]}:

any other costs or charges that will apply (or, where those charges cannot reasonably be calculated in advance, the fact that such additional charges may be payable)
the fact that the consumer has a right to cancel the contract within 14 days from when the contract is concluded, and how to exercise that right ^{[footnote 35]}

Avoiding misleading actions: information must be accurate and not misleading

All information provided to consumers (including information contained in advertising, online, in terms and conditions, and in verbal communications) must be correct. The information must also not give a misleading impression, even if it is factually correct.

When a business gives people information that is inaccurate or misleading, and that causes or is likely to cause an average consumer to make a different decision in relation to the unregulated legal service than the one they would otherwise have made, that will breach consumer protection law.^{[footnote 36]}

We set out below some specific considerations that apply in relation to claims relating to pricing; claims relating to the nature of services provided; claims related to membership of trade associations or membership bodies; and online reviews.

Claims relating to pricing

Unregulated legal services may provide a cost-effective option for consumers. However, businesses providing such services must not mislead consumers about the costs of the services or the savings they might make.

The following are examples of practices that are likely to mislead consumers:

misleading starting prices: Advertising or presenting consumers with an unrealistically low starting price (‘prices from £X’) that does not reflect the total costs that at least a significant proportion of consumers are likely to pay. A business is more likely to find itself on the right side of the law if the price reflects what most people will pay
drip pricing: Giving consumers initial price information that is incomplete, and only telling them later in the purchasing process about other charges or fees they will have to pay (for example, additional charges to check the validity of a will) ^{[footnote 37]}
misleading claims regarding ancillary costs or third-party fees: Failing to inform consumers about any additional or ancillary costs that are necessary in order to achieve the desired outcome (for example, court fees for divorce or probate). Businesses must be upfront about all costs a consumer will need to incur (including all expenses or disbursements, and third-party costs), prior to purchase of the service
misleading comparisons: Comparisons can be helpful for consumers. However, comparisons between the prices of different services may be misleading where it is not clear that there is a difference in the service that the consumer will receive. For example, where an online divorce business offers a limited divorce management service ^{[footnote 38]}, but does not provide legal advice, it may be misleading for that business to run advertising stating that its service will save consumers thousands of pounds in comparison to obtaining advice from a solicitor. This can be a particular issue with unregulated legal services, if consumers must purchase further (reserved) legal services to achieve the outcome the unregulated legal service provider is advertising ^{[footnote 39]}

Claims relating to the nature of services provided

Legal services are potentially complex and may be intimidating to many consumers. Businesses must ensure that the claims they make about the services they are offering are not misleading to the average consumer.^{[footnote 40]}

Legal services can involve jargon. Businesses must not take advantage of consumers by using unclear language to give consumers misleading impressions about the nature of the services they are receiving.

It is important that businesses providing unregulated legal services do not lead consumers to believe that:

their activities are regulated or approved by a regulator (such as the Solicitors Regulation Authority, the Law Society of Scotland, or the Law Society of Northern Ireland)
consumers will have the same regulatory protections that are available to clients of regulated providers

This includes giving consumers the impression that this is the case by using ambiguous language.

Where a business is selling both one-off and subscription services, it must be clear to consumers about the terms that apply to each, and it should not use the consumer’s purchase of a ‘one-off’ service to ‘opt-in’ a consumer to a subscription service.

Businesses must not give consumers the impression that the choices they make are easily reversible, where this is not accurate. For example, a business should not claim that a consumer’s choice to appoint it as executor is easily reversible, when in fact there may be legal or practical difficulties to reversing such a decision, or where the consumer may incur costs to do so.^{[footnote 41]}

A business’s membership of a trade association or membership body is likely to be a factor in establishing a consumer’s trust in that business.

To comply with consumer law, a business must not misrepresent the nature of its involvement with such a body, and must not misrepresent the nature of the body itself and/or the consequences of membership.

For example, if membership is limited to individual practitioners, a practitioner’s employer should not claim that the business as a whole (as opposed to the individual practitioner) is a member of that body. Such a claim would mislead consumers into thinking the business is bound by codes of practice which, in fact, do not apply.^{[footnote 42]}

Where a business is a member of a trade association or membership body, consumers should be able to have confidence that the requirements that the body imposes on its members (for example, through a code of conduct) will be complied with. Consumer law therefore imposes a specific obligation on businesses not to break codes of conduct they claim they are subject to.^{[footnote 43]}

Online reviews

Many businesses publish online consumer reviews. Genuine and accurate reviews can help consumers to choose which businesses and services to use, and increase competition between businesses. However, fake and misleading reviews have the potential to damage those businesses that play by the rules, and to harm consumers by leading them to make poor choices, undermining consumer trust.

Reviews will be ‘fake’ where they are not a person’s honest and impartial opinion or do not reflect a person’s genuine experience of a product or a business, for example, where a business poses as a consumer for the purpose of posting reviews on its website.^{[footnote 44]} This practice is a breach of consumer law.^{[footnote 45]}

Reviews may also be misleading, for example, if a business’s website has a feature which allows people to review its services publicly, it can be misleading for the business to “cherry-pick” only favourable reviews for publication rather than publishing all genuine, relevant and lawful customer reviews. Reviews can also be misleading where the business has provided any form of incentive or reward to a consumer to write the review, but this has not been clearly disclosed to consumers reading reviews.

Businesses should take appropriate steps as are necessary to prevent fake or misleading reviews appearing on their websites. Such steps include^{[footnote 46]}:

implementing procedures to detect and promptly remove fake reviews (for example, through moderation policies)
making it easy to report suspicious reviews

We do not consider it to be sufficient for a business to take action only where it receives complaints or other notice that a review is fake or misleading.

Alongside ensuring that they are complying with current law, businesses should be mindful of the upcoming legislative changes.

The DMCC Act sets out new ‘banned practices’ relating to consumer reviews. Banned practices are specific practices which will be considered unfair under consumer law in all circumstances. While not yet in force^{[footnote 47]}, the new banned practices are in addition to, and without prejudice to, existing consumer protection law. The CMA will be publishing guidance to explain the application of the new banned practices and what businesses should do to comply in due course. To the extent that the new guidance conflicts with the contents of this guidance, businesses will be expected to apply the new guidance.^{[footnote 48]}

Generally unfair commercial conduct

Consumer protection law also contains a broad general prohibition on unfair commercial conduct.^{[footnote 49]} Where a business falls below the standards of skill, care, honesty and good faith that can reasonably be expected in their field of activity, and that distorts (or is likely to distort) the decisions consumers make, that can break the law too.

Ensuring that terms and conditions between providers of unregulated legal services and consumers are fair

Businesses must ensure that terms are transparent, clear, and unambiguous, and are not unfair.

General principles of fairness

The terms businesses use in contracts with consumers must be fair and transparent. That includes everything businesses say in documents that bind consumers as part of the relationship between them, not just the terms contained in a formal ‘terms and conditions’ document. Where we refer to ‘terms’ in this guidance, we mean all of these.

Most terms ^{[footnote 50]} will be subject to the test of fairness under the Consumer Rights Act 2015 (CRA).^{[footnote 51]} That test says a term is unfair (and therefore unenforceable) ‘if, contrary to the requirement of good faith, it causes a significant imbalance in the parties’ rights and obligations under the contract, to the detriment of the consumer’.

In addition, the CRA contains:

a ‘blacklist’ of some terms that are always unenforceable regardless of their effect on the consumer (and so do not need to be assessed for fairness before being found unenforceable)
an ‘indicative and non-exhaustive list’ ^{[footnote 52]} of terms that may be unfair – this is known as the ‘grey list’

Consumers are likely to be in a relatively weak position compared with an unregulated legal services provider, given the complexity of the services being purchased, and consumers’ relative lack of knowledge about the contract and the way it operates. Terms which take away rights the consumer would usually have under the law, putting them in a worse position, and taking advantage of their relatively weak position, are likely to be unfair.

A term that is unfair will not be binding on consumers ^{[footnote 53]}, and the CMA can take enforcement action to stop businesses using unfair terms.

Terms should be accessible

Terms should also be easily located by and accessible to consumers. A provision that purports to bind consumers to terms that they have not had the chance to become familiar with or understand may be unfair.^{[footnote 54]} This can occur where:

terms are not clearly pointed out to consumers when they are considering the purchase
terms are located in a number of different documents and/or different places on a website, making them difficult to find and review
very lengthy documents are used
the terms are written in language that is difficult to understand (for example, using legal jargon) or include irrelevant, inconsistent, or ambiguous information

Businesses should ensure that any terms that may be particularly surprising or important are specifically brought to the consumer’s attention; for example, by highlighting them within an offer letter or a factsheet. Providing information upfront will not necessarily transform a term that is unfair into a fair one, but it is one of the essential steps to comply with the law.

Terms relating to pricing

In addition to ensuring all fees and costs are transparently presented to consumers at the point of purchase (see paragraph on the context of unregulated will writing and necessary pre-contract information, businesses should take particular care with terms that relate to price increases, hidden fees and contracts where the consumer ‘pre-pays’ for services:

Price increase clauses: Clauses which give a business a right to vary the price after the contract is made are under strong suspicion of unfairness. They are less likely to be unfair where:
- they are adequately brought to the consumer’s attention prior to entering the contract
- they specify the level and timing of any price increase (within narrow limits if not precisely)
- the trader is required to give sufficient notice of the variation
- the consumer has a genuine right to cancel the contract without loss or serious inconvenience ^{[footnote 55]}
hidden fees: It is likely to be unfair for a business to seek to enforce ‘hidden’ fees if the consumer had no real opportunity to become aware of the term imposing the fee prior to entering into the contract ^{[footnote 56]}
prepayment: It can be unfair for a business to seek prepayment of large sums of money upfront, in return for services to be delivered at a later time.^{[footnote 57]} This is because the prepayment results in an imbalance in incentives ^{[footnote 58]} and because it takes away a remedy that would otherwise be available to the consumer to withhold an element of the price to secure the business’s performance.^{[footnote 59]} In addition, unless the business takes appropriately robust measures to protect consumers’ funds, pre-payment can expose consumers to the risk of the business’s own insolvency or cessation of business

Terms relating to variations of the contract

It is important that consumers receive the service they expected. Terms which allow the business to alter the terms of the contract after it has been agreed are under strong suspicion of unfairness.^{[footnote 60]} This includes terms that allow the business to change what is being supplied.^{[footnote 61]}

Terms allowing for variation of the contract are more likely to be fair where^{[footnote 62]}:

the term is narrow in its scope and effect
the term is brought to the attention of consumers at an early stage
the term sets out valid reasons why changes may be necessary, and consumers are able to foresee what changes may be made and when (for example, a term allowing minor technical variations, or variations to reflect changes in the law)
the business is required to give notice of the variation in good time before it takes effect
the consumer is able to terminate their obligations without penalty if they are adversely affected by the change

Terms that seek to exclude or limit liability

Contractual terms may be considered unfair where they unduly exclude or restrict a business’s liability to consumers.

The usual legal position is that a consumer who suffers losses as a result of a business’s actions will be able to bring legal proceedings to obtain compensation. Terms which state that the trader will not be liable in certain circumstances, or that restrict the amount of compensation a trader is required to pay, may give rise to a significant imbalance in the parties’ rights and obligations under the contract.

Terms excluding liability

Certain types of terms excluding liability are ‘blacklisted’ and are therefore automatically ineffective. This includes:

terms that exclude the business’s liability if it fails to provide the service with reasonable care and skill ^{[footnote 63]}
terms that exclude the business’s liability for things that the business has said to the consumer and which have been taken into account by the consumer when making decisions about the service ^{[footnote 64]}

Terms that exclude liability but do not fall within these categories may still be unfair if they cause a significant imbalance (in the way paragraph on consumers in a relatively weak position describes).

The mere addition of a statement that ‘statutory rights are not affected’ will not make an unfair term acceptable.^{[footnote 65]} Similarly, terms that exclude liability ‘as far as the law permits’ are still potentially unfair.^{[footnote 66]}

Terms excluding liability are more likely to be fair where they are restricted to excluding liability for ^{[footnote 67]}:

losses that were not foreseeable to both parties when the contract was formed
losses that were not caused by any breach on the part of the trader

Terms limiting liability

Terms that limit the amount of compensation a business is liable to pay will be ‘blacklisted’ if they:

limit the business’s liability if it fails to provide the service with reasonable care and skill ^{[footnote 68]}
limit the business’s liability if it breaches the consumer’s statutory rights to an amount less than the price the consumer is required to pay under the contract ^{[footnote 69]}

Terms that restrict liability but do not fall within these categories may still be unfair if they cause a significant imbalance (in the way paragraph on the test of fairnessdescribes).

In particular, clauses that impose an upper limit on the amount of compensation the consumer would be entitled to claim would be under strong suspicion of unfairness.^{[footnote 70]}

Unregulated businesses are not legally required to hold professional indemnity insurance. However, as a matter of good commercial practice, unregulated businesses providing legal services should have in place adequate insurance to cover potential claims.

Terms relating to the right to cancel

Businesses must ensure that their terms and conditions are consistent with consumers’ legal rights to cancel their contract.

The starting point is that a consumer who has purchased a legal service away from the business premises of the unregulated legal service provider ^{[footnote 71]} will usually have the right to cancel their purchase (and receive a full refund) ^{[footnote 72]} within 14 days of the purchase. Businesses should not usually supply the service until that period has expired.

Of course, there will be many situations where a consumer wants (or needs, in the case of a deathbed will) the service to be delivered within the 14-day time period. So, a business can, exceptionally, provide the service in that period where the consumer has:

requested that the service is provided within that time
acknowledged that they will lose their right to cancel once the service is completed in full ^{[footnote 73]}

Businesses can propose that the consumer gives a waiver which meets these requirements. If the consumer is happy to do so, this should be recorded in writing.

In addition, even after the 14-day period has expired, the terms that govern early termination by either the business or consumer must be fair.^{[footnote 74]} This includes not unfairly penalising a consumer who chooses to end their contract with the business earlier than initially agreed. In particular, a term which has the effect that the consumer will always lose everything they have paid, regardless of the actual losses caused by the cancellation, is likely to be unfair. A term is more likely to be fair if, for example, the consumer is entitled to a refund of sums paid, but the business is permitted to deduct legitimate costs it has incurred or loss of profits arising from the cancellation.

Terms relating to subscription services

We are aware that some unregulated legal service providers operate a subscription model for elements of their services (for example, in relation to will storage or will updates).

Businesses offering services on a subscription basis must ensure the terms of their subscription are fair.^{[footnote 75]} A term which has the effect of automatically renewing or ‘rolling-over’ a contract is more likely to be fair where:

it is properly brought to the consumer’s attention before entering into the contract
the business is required to take reasonable steps to inform the consumer of the upcoming renewal and to give the consumer a reasonable opportunity to cancel the contract before any further payment is taken
there are reasonable procedures which allow for cancellation of the contract during the renewed period. For example, any fees charged at termination should have been made clear to the consumer prior to their purchase of the subscription service, and should reflect only the actual costs to the business (for example, the reasonable cost of shipping a will from storage to a consumer). Consumers should not be subject to unreasonably long notice periods in order to cancel a non-fixed term contract ^{[footnote 76]}

The DMCC Act will, once the relevant provisions come into force^{[footnote 77]}, introduce new obligations for businesses offering services on a subscription basis. These include:

a duty to provide or make available certain key pre-contract information ^{[footnote 78]}, including specific requirements where the contract is entered into online ^{[footnote 79]}
giving consumers regular six-monthly reminders ahead of renewal payments (including the opportunity to end the subscription) ^{[footnote 80]}
14-day cooling off periods, allowing the consumer to cancel the subscription without penalty or charge within that period, both at the start of the contract and when it renews ^{[footnote 81]}
a right for consumers to cancel a subscription contract without penalty or charge where the trader breaches certain key requirements applying to subscription contracts ^{[footnote 82]}

The outline above is not exhaustive. Businesses offering subscription services should therefore review the new obligations in detail and adjust their practices as necessary to ensure they comply, seeking legal advice if necessary.

Ensuring that services are performed with reasonable care and skill

Businesses must ensure that their services are provided with reasonable care and skill.

Consumer protection law requires that businesses use reasonable care and skill in providing services to consumers.^{[footnote 83]}

Consumers purchase unregulated legal services to address very specific and often sensitive needs. In many cases, these will be one-off purchases. Consumers are unlikely to have wide experience of the services in question, and may be at a disadvantage relative to providers of those services in detecting shortfalls in quality. For many consumers, an unregulated legal service provider will be an alternative to more traditional vendors, such as solicitors’ firms. The requirement to use reasonable care and skill applies in that context.

Areas of particular relevance here include:

Competence: The service must be delivered by individuals possessing a degree of professional knowledge appropriate to the complexity of the service offered
suitability: Businesses should ensure that their services meet the legal requirements of the jurisdiction they are marketed for use in.^{[footnote 84]} Similarly, businesses should ensure that they do not carry on ‘reserved’ legal activities unless they are legally permitted to do so ^{[footnote 85]}
selling additional services: Businesses should not use their position as adviser to ‘up-sell’ unnecessary or unsuitable services
clear advice: Unregulated providers of legal services must be clear about the nature and limits of the service they are providing. Simply including disclaimer language in contractual materials does not mean that an unregulated provider is absolved of this responsibility. Consumers should be informed when issues arise that impact the effectiveness of the service being delivered and that require other professional help to resolve (for example, tax issues)
safeguarding of consumer assets: If the service involves long-term responsibility for consumer assets (for example, will storage) there will need to be safeguards to address not only ‘business as usual’ risks, but also to ensure that consumers do not suffer losses where the business itself ceases or becomes insolvent
record keeping: Businesses should keep (and share with consumers, if appropriate), accurate records of the advice they are providing, and should ensure they comply with data protection law ^{[footnote 86]}
responsiveness and complaints handling: Businesses offering unregulated legal services should have processes for taking care of consumers’ requests or complaints promptly and effectively: consumers should also be given, before purchase, the business’s contact details and its complaints handling policy
prompt and timely service: Businesses are required to deliver services at the time agreed or, if none is agreed, within a reasonable time.^{[footnote 87]} Delays that arise for reasons genuinely beyond a business’s control should be communicated to consumers appropriately, and failing to offer consumers a termination right (along with a refund) in such a case is likely to be unfair

Where a service is not performed with reasonable care and skill, the consumer will have the right to request that the business provide the service again ^{[footnote 88]}, and (in certain circumstances) the right to a refund.^{[footnote 89]} In addition, the consumer may pursue other legal remedies, including a claim for damages.^{[footnote 90]} Contract terms which exclude or limit these obligations and consumer rights are not binding on the consumer.^{[footnote 91]}

Ensuring that sales practices are not misleading or aggressive, or otherwise contrary to statutory obligations

Businesses must not use sales practices that amount to harassment, coercion, or undue influence, and they must not take additional payments without consent.

Aggressive sales practices

Consumer protection law prohibits practices that harass, coerce or use undue influence and that significantly impair consumers’ freedom of choice and affect their decisions about products.^{[footnote 92]}

This covers a variety of behaviours. Practices which may be considered to be aggressive include:

staying in a consumer’s home after being asked to leave, or staying for so long that they feel compelled to purchase the products the representative is selling ^{[footnote 93]}
using knowledge about a consumer’s affairs gained in, for example, drawing up a basic will, to aggressively ‘upsell’ other products
making misleading, exaggerated or frightening claims regarding, for example, inheritance tax liabilities, to pressure a consumer who has purchased will writing services to order additional complex trust products which the consumer would not otherwise purchase
pressuring consumers to purchase additional services by presenting the decision not to buy such a service as a legal risk (for example, pressuring a consumer into purchasing a service that is unnecessary and unsuitable by requiring them to sign a ‘disclaimer’ stating that the business is not responsible for the consequences of that consumer choosing not to purchase the service in question)
exploiting a consumer’s specific misfortune, and/or exploiting other circumstances which are serious enough to affect the consumer’s judgement (eg a recent bereavement), in order to influence the consumer’s decision with regard to the service
using abusive or threatening language to dissuade a consumer from terminating a contract
making unjustified threats of legal proceedings

Businesses must not attempt to charge consumers for amounts over and above the amount agreed for the main services they will receive unless the consumer has first given their express consent.^{[footnote 94]}

The consumer is not legally regarded as having given their consent where the business has made consent a ‘default’ position that the consumer must take some action to change (for example, if an ‘I consent’ box on a webpage is pre-ticked).

Similarly, consumers should not be ‘opted-in’ to subscription services (such as a will update service where the service they have set out to purchase is a standalone will).

Will writing

A number of consumer protection issues have come to our attention in the will writing sector. Consumers are unlikely to use the services of a will writer frequently, and so may not have a clear idea of what to expect as regards costs, processes and services. Will writing businesses must take care not to take advantage of the imbalance of experience and expertise between their position and consumers, or to use other harmful practices.

Businesses must not, for example, provide insufficient information regarding pricing and costs, or use aggressive ‘upselling’ practices to sell services the consumer was not initially seeking. Nor should they use contract terms that seek unfairly to limit or avoid the usual obligations they are under, and the usual rights and protections consumers have, under the law. Businesses that use misleading or aggressive marketing practices and/or unfair contract terms will be in breach of consumer law.

This Chapter sets out ‘do and don’t’ checklists and case studies as a means of illustrating how the consumer law principles outlined in Chapter 3 can apply to the unregulated will writing sector.

It is important to emphasise that these examples are focussed on compliance with consumer law specifically, and are not intended to provide a comprehensive account of all legal considerations that may be relevant to will writing services. Further, the examples do not cover every potential consumer law issue that may arise.

We note that some will writing businesses partner with charities to offer consumers wills free of charge (encouraging the consumer to leave a gift to the relevant charity). The fact that a business is not directly receiving payment for its service from consumers does not automatically remove it from the scope of consumer protection law.^{[footnote 95]}

Do and Don’t

Ensuring consumers have the information they need to make informed decisions

Do

clearly and prominently give consumers the total price of the service you are marketing, including VAT and including likely expenses or associated costs, even if not charged by you (or, if you genuinely cannot state the total price, explain the basis on which it will be calculated)
provide consumers with the information they need to make an informed decision about whether to purchase. This will vary depending on the circumstances but may include:
- a description of the services you will provide
- an explanation of whether the business is regulated
- details of the level of experience and/or qualifications of staff
- an explanation of whether or not you hold professional indemnity insurance
if you sell other services alongside will writing (such as acting as a professional executor, or offering will storage services) market those services clearly and transparently, including by providing information about:
- whether such services are included or excluded in the initial will writing product sold
- the price of any such (separate) service (or the basis on which the price will be calculated) (for an example, see case study 3 below)
- the fact that such services are not necessary for a valid will
- the implications of a consumer taking on such a service (for example, the fact that appointing you as a professional executor will mean amending the will if the testator subsequently changes their mind)
- where your marketing materials advertise future flexibility, any relevant legal or practical limitations on that flexibility (for example, the law limits the ability of an executor to renounce their executorship or ‘retire’ in certain circumstances) (for an example, see case study 2 below)
- in the context of will storage services, what will happen to the consumer’s will in the event that your business stops trading
in addition to the above, if you sell subscription services, you should provide information before the consumer enters into the initial contract, and before each renewal takes effect (see also paragraphs on the relevant DMCC Act requirements).

Before entering into the initial contract

You should provide information about:

whether or not the contract auto-renews at the end of a period of time
the timing and frequency of payments

Before renewing the contract

You should send consumers a reminder a reasonable time before the renewal takes effect, setting out:

the terms of the proposed renewal, including how much the consumer will be charged for the service upon auto-renewal
how they can cancel the subscription before renewal
how they can cancel the subscription once the contract is renewed

If services will be carried out by a third party (for example, where the will writer’s practice is to instruct another provider to provide professional executorship services or will storage services) businesses should ensure that this is clearly and accurately communicated to consumers (for an example, see case study 6 below). In addition, consumers should be provided with:

the name of the provider(s) (or, if a panel system is used, the names of the potential providers)
the regulatory status of the provider(s) or potential providers

Don’t

make misleading comparisons when marketing your services: for example, if you are selling a straightforward will template, and do not provide legal advice, it may be misleading to compare your prices with those of providers offering a more comprehensive service. If you want to use a price comparison, you should explain the differences between the services on offer
give consumers incomplete price information when extra charges will be added later, or suggest that consumers will pay a lower price than they realistically will (for an example, see case study 3 below)
lead consumers to think that by purchasing your service they are engaging a firm of solicitors or other regulated legal professionals on their behalf, or that the service provided is otherwise subject to regulatory oversight, if this is not actually the case (for an example, see case study 1 below)
make misleading claims about your membership of a trade or professional body (for an example, see case study 1 below)
make misleading claims about the availability of future options that are restricted by law or are in fact difficult to exercise (for an example, see case study 2 below)

Ensuring terms and conditions between providers of unregulated legal services and consumers are fair

Do

ensure that your terms and conditions are easily accessible, clearly signposted and available to consumers before they make their decision to purchase
ensure your terms are written in accessible, clear and transparent language that the average consumer will be able to understand (including as to their practical consequences for the consumer)
ensure that any terms that may be surprising or important are specifically brought to consumers’ attention
where substantial sums are involved, charge consumers on a reasonable schedule, as and when you deliver the relevant services

Don’t

use terms that generally allow you to change the price of services a consumer has agreed to purchase as this is likely to be unfair, unless you comply with the principles outlined in price increase clauses above (for an example, see case study 4 below)
use terms that allow you to change elements of the service you have agreed to provide, unless there is a specific and fair reason for doing so, and the term is implemented in a fair way (see information on terms allowing for variation of the contract above) (for an example, see case study 4 below)
unfairly limit your liability to consumers (see information on contractual terms that may be considered unfair above) (for an example, see case study 5 below)
use terms which are inconsistent with consumers’ rights to cancel the contract, or which unfairly penalise a consumer who chooses to end the contract (see terms relating to the right to cancel and subscription servicesabove)
in relation to subscription services, do not use terms which provide that the subscription will automatically renew or ‘roll over’ without taking reasonable steps to inform the consumer of the renewal, and giving the consumer a reasonable opportunity to cancel the contract without incurring further cost

Ensuring services are performed with reasonable care and skill

Do

ensure your business has the staff and capability to deliver the services you advertise and to meet your obligations to your customers
ensure that the services your business offers meet the legal requirements of the jurisdiction they will be used in
ensure that services are delivered when agreed or, if no time is agreed, within a reasonable time
ensure that your business has processes for dealing with consumer complaints promptly and effectively

Don’t

rely on unfair terms or ‘small print’ to avoid delivering on your obligation to deliver services with reasonable care and skill

Ensuring that sales practices are not misleading or aggressive, or otherwise contrary to statutory obligations

Do

provide balanced, complete and accurate information about the range of options available when informing consumers about additional services (for example, appointing executors to a will or making arrangements for will storage), so that consumers can make a fully informed choice

Don’t

use pressure selling techniques (for example, staying in a consumer’s home after you have been asked to leave) which harass, coerce or unduly influence a consumer to make a decision they would otherwise have been unlikely to make (for an example, see case study 2 below)
attempt to enrol a consumer into a subscription or other service by presenting them with pre-ticked boxes which steer them towards, for example, taking up a will storage service or appointing you as professional executor
unfairly steer the consumer towards appointing you as professional executor, for example by making exaggerated statements about the burdensome or stressful nature of executorship duties (for an example, see case study 2 below)
lead consumers to believe that their only option is to take up your will storage service, when there are other options available (for example, storing a will with HM Courts and Tribunals Service)

Will writing case studies

Wills example 1: Misleading claims regarding involvement of solicitors and regulatory oversight

A will writer employs in-house solicitors who are regulated by the SRA, and a staff of unregulated paralegals. The solicitors do not advise clients (or supervise paralegals giving advice).

The business claims on its website that:

‘our template will was drawn up by our in-house solicitor, and our in-house legal professionals will review your draft will before sending it to you for attestation’
‘our clients benefit from the additional protection of the involvement of our in-house solicitors, regulated by the Solicitors Regulation Authority’

Statements such as these are likely to mislead consumers as to the nature of the service they are buying. That is because:

the first statement may mislead consumers as to the nature of the service they are buying, by giving the impression that each will is reviewed by a legally-trained person who will ensure it is suitable for the consumer’s circumstances. If, in fact, the review is limited to checking for typographical errors, for example, this is likely to be misleading
the second statement may mislead consumers as to their rights and protections, by giving the impression that consumers will benefit from the fact that the will writing business employs regulated solicitors. In fact, a consumer who purchases the services of this business may not have the benefits which regulation confers on the clients of solicitors, such as potential recourse to the SRA compensation fund or Legal Ombudsman

A compliant statement may read: ‘Our template will has been developed with the assistance of a solicitor. Your individual will is sense-checked by a member of our trained team. You should be aware that members of our team may not be regulated solicitors. They do not give legal advice specific to your situation and no solicitor-client relationship exists between you and our team.’

Wills example 2: ‘pressure selling’ techniques

A will writer marketing its services as a professional executor sets up a 15-minute meeting with a potential customer at their home to discuss will writing. The will writer’s representative stays 45 minutes, despite the consumer indicating shortly after the 15-minute appointed time period that she wishes to end the conversation and move on with other matters in her day.

Businesses engaged in behaviours such as this are acting unlawfully and must remedy these behaviours immediately. All sales staff should be trained in the importance of avoiding practices that seek to pressure potential clients into purchasing products.

In addition, the will writer’s sales literature in respect of its executor services includes claims that ‘you don’t need to worry about appointing us, as we will renounce our position on request by the beneficiaries of your will’. It also claims that ‘most people appoint us as their executor as if a loved one is appointed as an executor, it is time-consuming, complicated and stressful’.

This claim may induce a consumer to appoint the will writer as their executor on the basis that the appointment is easily reversible in the event their family so wishes, as well as giving the impression that they are saving their loved ones a burden by doing so. However, in the absence of a more detailed explanation, this statement may be misleading, as there may be legal barriers to the executor renouncing (for example, where it has already begun acting as executor). In addition, it omits the fact that a non-professional executor may (assuming the will includes an appropriate charging clause) be able to appoint a professional to assist them in their duties should they so wish.

To be compliant, this statement would need to be qualified, such as: ‘We may be able to step down from our role of executor. That depends on what is in the best interests of the estate, and we may discuss this with the beneficiaries before we start administering your estate. In some cases, we might not be able to step aside, or doing so might incur additional costs if we have already started work”.

A will writing business should also explore with a consumer whether other executors can be appointed alongside it, so that the risk to consumers of having to replace a professional executor is reduced.

Finally, this business should provide a more accurate and complete description of the duties associated with executorship, for example by signposting advice on the Citizens Advice or GOV.UK

Wills example 3: Misleading claims and potentially unfair terms regarding pricing of future services

A will writer advertises that it ‘does not charge a fee for our appointment as professional executor’ when, while it is true that no fee will be payable on appointment, the will writer will charge the estate fees for delivering the professional executor services after death.

This is likely to be misleading as it could cause a consumer to appoint a professional executor believing that the executor service will be provided at no extra cost, when in fact substantial fees may be incurred depending on the nature and extent of the work involved. Contract terms which give a business a unilateral and unlimited right to change fees and prices after the contract is agreed are also likely to be unfair.

To be more likely to comply, the will writer should ensure that, before deciding to appoint the will writer as professional executor, consumers are given accurate and clear information on the amount of any fees that may be charged and/or a detailed basis of how they will be calculated, when they will be charged and, in the event there is any future variation of those fees, how they may change.

It should always be clear whether the amounts quoted are for the work involved in administering the estate, or whether they are instead the fee for acting as an executor (and supervising others to do the necessary work).

The business’s contract terms should also reflect these points.

Wills example 4: potentially unfair contract term allowing business to unilaterally change terms and conditions

A will writer’s terms and conditions for its professional executor service include a term stating that the firm will provide executor services ‘subject to the terms and conditions in place at the time of your death’.

This type of variation clause, which allows a firm the unfettered right to vary the terms of the contract and the service – for example impose increased costs, new requirements or reduced benefits – is likely to be unfair whether or not it is meant to be used in that way, because the term permits the firm to change the terms of the service in unspecified ways that the consumer will not be in a position to predict.

A much more narrowly scoped term may be fair, if (for example) it:

only provided for variations that reflect changes in the law, to meet regulatory requirements or to reflect new industry guidance or codes of practice which are likely to raise standards of consumer protection
set out in the contract the potential reasons for the variation of contract terms, which are clear and specific enough to ensure the power to vary cannot be used at the firm’s discretion and that the consumer could understand in advance
required the firm to:
- give the consumer notice of the variation before becoming bound by it
- expressly draw the consumer’s attention to their option of replacing the will writing business as professional executor if the new terms are unsatisfactory to them (for example, by issuing a re-written will omitting the appointment at no charge to the consumer)

Wills example 5: potentially unfair term which limits trader’s liability

A will writer’s terms state ‘our liability to you and/or the beneficiaries of your estate under and in connection with this contract shall not exceed £10,000 in the aggregate.’

While this will allow the consumer (or their estate) to recover the purchase price of the will, the losses arising as a result of a negligently drafted or executed will could easily and substantially exceed this amount.

For example, in Esterhuizen v Allied Dunbar Assurance Plc compensation of over £170,000 (in today’s money) was awarded to disappointed beneficiaries who had not received the estate intended by the testator, due to an unregulated will writer’s negligence in connection with the attestation of the will. A consumer could also reasonably expect an unregulated will writer to maintain sufficient professional indemnity insurance to meet such a claim.

A blanket liability cap is likely to be unfair. Ordinarily (that is, if the clause is not included) the consumer has a legal right to compensation for breaches, so blanket liability creates a significant imbalance to the detriment of the consumer. A clause of this type is also likely to be contrary to the requirement of good faith: in purchasing an unregulated will writing service, the consumer would not reasonably expect to be left in a materially worse-off position when compared with purchasing a will prepared by, for example, a practitioner such as a solicitor (or an unregulated will writer) that is properly insured and does not include such clauses.

A term limiting liability is more likely to be fair if it reflects the usual legal position. Accordingly, limits on liability are more likely to be fair if they only exclude:

losses that were not foreseeable to both parties when the contract was made
losses that were not caused by any breach on the part of the trader

Wills example 6: services carried out by a third party

A firm relies on third party professionals to provide certain services (for example, the drafting of wills, professional executor services and will storage services) without clearly communicating this to the customer at the time of contracting.

The fact that certain services may be provided by a third party (and the details of any third-party providers) would likely constitute material information for the customer. A failure to provide this information may constitute a misleading practice.

On this basis, as mentioned in the ‘do and don’t checklists’ above, if services will be carried out by a third party, businesses should ensure that this is clearly and accurately communicated to consumers, including details of the relevant providers.

Online divorce

To finalise a divorce, it is necessary to obtain a formal court order dissolving the marriage. In this guidance, references to ‘divorce’ also include ‘dissolutions’ of civil partnerships. The process of applying for a divorce operates differently in each of England and Wales, Scotland, and Northern Ireland, and there are some differences in the terminology used.

Obtaining even a ‘straightforward’ divorce in the UK involves a degree of engagement with the courts. In England and Wales, it is now possible to file much of the paperwork connected with that process online.^{[footnote 96]} This may be done (if the consumer so chooses) without the involvement of a regulated legal professional such as a solicitor. In Scotland ^{[footnote 97]} and Northern Ireland,^{[footnote 98]} there are also processes allowing members of the public to file simple (or ‘DIY’) divorce applications.

A particular concern in this sector is the marketing of online divorce services where the service consists of assistance with completing forms that are available to consumers online – in other words, purely administrative services for divorce management. While some consumers may benefit from assistance with completing such administrative tasks during a challenging period in their lives, businesses must not mislead consumers about the substance of what they will or will not do for them, and the costs they will face.

In addition, depending on the individual consumer’s circumstances, the legal work necessary to complete the divorce may extend to reserved activities (for example, if litigation is necessary). It is important that consumers understand which services can, and cannot, be offered by unregulated businesses.

The following section sets out ‘do and don’t’ points and case-study examples as a means of illustrating the consumer protection issues that are likely to be particularly relevant to unregulated legal service providers in the online divorce sector.

Do and Don’t

Do

clearly set out and distinguish what is, and what is not, included in the service you are selling; consumers should be aware of whether you are providing only an administrative ‘divorce management’ service, or if you are providing legal advice that will assist their decision-making around the divorce process
clearly and prominently give consumers the total price of completing a divorce using your service, including VAT and all expenses that are likely to be involved (even if not directly charged by you): it should also be clear if this total cost excludes the costs of any additional legal services the consumer may need from other providers
provide consumers with the information they need to make an informed decision about whether to purchase. This will vary depending on the circumstances but may include an explanation of whether the business is regulated, details of the level of experience and/or qualifications of staff, and an explanation of whether or not you hold professional indemnity insurance
explain clearly to consumers the situations you can and cannot advise on, before the consumer engages your service
ensure that the services your business offers meet the legal requirements of the jurisdiction they will be used in

Don’t

give the impression your service provides benefits to consumers that it does not – for example, claiming that consumers in England and Wales who purchase your services will not have to attend court hearings, when this is not a standard part of the divorce process
suggest that consumers will pay a lower price than they realistically will (for example, by omitting court fees from overall pricing)
lead consumers to think that by purchasing your service they are engaging a firm of solicitors or other regulated legal professionals on their behalf if this is not actually the case
make misleading comparisons with competing services where the content of the service is substantively different (for example, comparing the (lower) cost of a straightforward administrative ‘divorce management’ service with the (higher) cost of engaging legal advice from a solicitor, without making clear the differences between these two services)
make misleading claims about the complexity of completing a ‘DIY divorce’ process so as to persuade consumers to purchase your service

Online divorce case studies

Online divorce example 1: misleading claims

An unregulated online divorce provider operating in England and Wales markets a product that consists of providing some high-level guidance on divorce processes, and collating information requested from the consumer (which is essentially a reflection of the information the consumer would be required to input into the HM Courts and Tribunals Service (HMCTS) online form).

The business makes the following advertising claims:

‘Online divorce: complete service for only £180’
‘You can rest easy that your divorce is being handled by a team supervised by qualified solicitors’
‘A DIY divorce will involve over 20 hours of time, but our service requires less than 2 hours of your time’
‘No court hearings’
‘Our service gives you a complete divorce with no need for you to fill out or look at the paperwork’

This conduct is likely to breach consumer protection law in a number of respects:

the reference to ‘complete service for only £180’ omits the court fee of £593 which will be payable by the majority of consumers (and, if the consumer required other legal services or advice to complete their divorce, they would also incur the additional costs of these)
the advertising is liable to give consumers the impression that they are receiving the benefit of a solicitor’s legal advice whereas in reality there is no client relationship between the consumer and the solicitor
the statement that a DIY divorce will take 20 hours is not substantiated and is likely to mislead consumers as to the benefits of the service
the statement that ‘no court hearings’ are required is liable to be misleading as court hearings are not a standard component of the divorce process in England and Wales
finally, the claim that there is no need for the consumer to ‘complete or look at any paperwork’ is a concern because, even if the provider assists with filling out paperwork (for example, by taking instructions over the phone) it would not be professionally diligent for an advisor to tell a member of the public to submit divorce filings without first reviewing them

Compliance is more likely to be achieved if this business:

is upfront with consumers about the service it is selling (its scope and its limits)
removes misleading references to supervision by qualified solicitors
adds ‘plus court fees of £593’ to their price advertising (and includes reference to any other applicable costs)
uses prominent language clarifying that no solicitor-client relationship is being established
ensures that all claims about the benefits of its service, and/or the disadvantages of the consumer completing the divorce process without the assistance of its service, are accurate and not misleading
makes clear what consumers will need to do in order to achieve a successful outcome (and does not omit ‘inconvenient’ details, such as the need for a consumer to file their own paperwork)

Online divorce example 2: unfair limitation of liability

An online divorce provider includes, in its terms and conditions, the following:

‘Our liability to you for any loss, whether arising in tort, breach of contract or otherwise, shall not exceed the purchase price of our online divorce service’.

This is likely to be an unfair term: if an online divorce provider fails to carry out services correctly, the usual legal position is that the consumer may be able to sue the provider (for example, for breach of contract) and claim damages for the loss they suffer.

That loss could be considerably greater than the price of the services (potentially many times greater if – for example – a consent order dealing with the division of valuable assets had been finalised based on faulty advice or guidance). The term seeks to change that position for the business’s benefit and to the significant detriment of the consumer. That unfairness is likely to be amplified because consumers may reasonably expect that the provider of a professional service would have professional indemnity insurance in place sufficient to cover likely losses.

A term limiting liability is more likely to be fair if it reflects the usual legal position – so limits on liability are more likely to be fair if they only exclude:

losses that were not foreseeable to both parties when the contract was made
losses that were not caused by any breach on the part of the trader

Pre-paid probate

Overview of consumer protection issues in the pre-paid probate sector

Pre-paid probate plans operate on the basis that consumers pay ‘up-front’ for probate services which will be provided after their death.

The term ‘probate’ is used throughout this Chapter to refer to the broader process of dealing with the estate of a person who has died. This process is also commonly referred to as ‘administering the estate’ or, in Scotland, ‘executry administration’. It includes, for example, valuing assets, obtaining a grant of probate (or, in Scotland, a grant of confirmation) from the courts, liaising with HMRC in relation to inheritance tax, liaising with the appropriate financial institutions, ensuring the accurate distribution of the estate, and preparing the necessary accounts.

The CMA considers that pre-paid probate plans give rise to significant consumer protection risks. In particular:

it is difficult to predict in advance whether probate will be required, and the scope of the services required if it is. For example, if the consumer’s financial position changes in the time between purchasing the pre-paid probate plan and their death, with the result that the estate is too small to require obtaining a grant of probate, the money spent on purchasing the pre-paid probate plan may be wasted
there is a risk that the company may cease trading in the time between the consumer purchasing the plan and the consumer’s death (which may be years, or even decades, after the plan was purchased), leaving the consumer (or their estate) out of pocket
although businesses may present themselves as taking steps to protect consumers’ funds, these may not be meaningful: for example, the fact that consumers’ funds are held on trust is unlikely to provide adequate protection if the terms of the trust deed allow the trustees to make distributions to cover management expenses

Concerns about pre-paid probate plans are shared by other regulators, and by membership bodies:

in January 2023, the Financial Conduct Authority published a ‘consumer warning on pre-paid probate plans’, alerting consumers to the fact that pre-paid probate plans are unregulated in the UK, and advising that consumers ‘consider carefully whether these products meet your needs and offer value … as there are no regulatory protections in place’^{[footnote 99]}
at the time of writing, the codes of practice of two membership bodies for will writers and estate planning professionals – the Best Foundation, and the Society of Will Writers^{[footnote 100]} – expressly prohibit their members from offering pre-paid probate plans
similarly, The Society of Trust and Estate Practitioners (STEP) has expressed the view that ‘the few advantages that pre-paid probate plans can offer are far outweighed by their risks’^{[footnote 101]} and the Institute of Professional Willwriters has stated that it ‘does not condone the sale of pre-paid probate plans and [considers that] any sale of such would breach the IPW code of conduct namely to ensure any product or service provided by an IPW member must always be in the best interest of the client.’

Practices likely to breach consumer law

Given the above, and the broad general prohibition on unfair commercial conduct in consumer protection law, it may be difficult for businesses to provide pre-paid probate services at all without falling foul of the law. Even if they can, the CMA’s view is that the following practices would be likely to breach consumer law:

failure to clearly and accurately explain the scope of the services that are included in, and excluded from, the pre-paid probate plan
making claims which mislead consumers as to the risks or benefits of purchasing a pre-paid probate plan (including by omitting to tell them about the risks)
making statements which convey to consumers that:
- a grant of probate is always required^{[footnote 102]}
- the process of probate in the absence of a pre-paid plan is especially burdensome or stressful
- in the absence of a pre-paid plan, their executors will have no option but to engage professional advisers to provide assistance with probate
failure to implement protections to ensure that, in the event the business ceases trading prior to the consumer’s death, the probate services will be provided by a third party, or the sums paid will be refunded in full
failure to provide consumers with full and accurate details of the protections that have been put in place to safeguard their funds
Where funds are held on trust, using terms which:
- allow the business to deduct unspecified sums prior to the funds being placed on trust and/or allow the trustees to make unspecified payments to the business, to cover (for example), marketing and administrative costs
- do not adequately protect consumers’ funds, for example by permitting inappropriate financial investments
using contract terms which provide that consumers who terminate their involvement with the plan prior to redeeming it will not receive any refund in any circumstances

Consumer savings schemes

Finally, businesses operating in the pre-paid probate market should be aware that the DMCC Act introduces new obligations for traders operating ‘consumer savings schemes’.^{[footnote 103]} These provisions are not limited to any specific form of consumer savings scheme, and to the extent a pre-paid probate plan involves the retention of consumer funds for future redemption against a pre-paid probate service, could apply.

Under the DMCC Act, businesses operating consumer savings schemes must make and maintain certain specific insurance or trust arrangements to return protected payments to consumers if the business becomes insolvent.^{[footnote 104]}

When these provisions enter into force,^{[footnote 105]} businesses offering pre-paid probate schemes will need to consider whether the specific products they offer amount to a ‘consumer savings scheme’ for the purposes of the DMCC Act and therefore are subject to these additional obligations. They should seek legal advice on that point if necessary.

Competition & Markets Authority CMA

Unregulated legal services: Consumer protection law guidance

Contents

Summary

Introduction

The CMA’s mission and powers

What does this guidance cover?

Whom is this guidance for?

Relationship with other law, regulation and guidance

What businesses need to do

What happens if businesses fail to comply with consumer protection law?

The Digital Markets, Competition and Consumers Act

Consumer protection law obligations: an overview

Ensuring that consumers have the information they need to make informed decisions

Misleading actions and omissions

Avoiding misleading consumers by omission: what information needs to be provided?

Material information

Pre-contract information

Avoiding misleading actions: information must be accurate and not misleading

Claims relating to pricing

Claims relating to the nature of services provided

Claims related to membership of trade associations or membership bodies

Online reviews

Generally unfair commercial conduct

Ensuring that terms and conditions between providers of unregulated legal services and consumers are fair

General principles of fairness

Terms should be accessible

Terms relating to pricing

Terms relating to variations of the contract

Terms that seek to exclude or limit liability

Terms excluding liability

Terms limiting liability

Terms relating to the right to cancel

Terms relating to subscription services

Ensuring that services are performed with reasonable care and skill

Ensuring that sales practices are not misleading or aggressive, or otherwise contrary to statutory obligations

Aggressive sales practices

Additional payments without express consent

Will writing

Do and Don’t

Ensuring consumers have the information they need to make informed decisions

Do

Before entering into the initial contract

Before renewing the contract

Don’t

Ensuring terms and conditions between providers of unregulated legal services and consumers are fair

Do

Don’t

Ensuring services are performed with reasonable care and skill

Do

Don’t

Ensuring that sales practices are not misleading or aggressive, or otherwise contrary to statutory obligations

Do

Don’t

Will writing case studies

Wills example 1: Misleading claims regarding involvement of solicitors and regulatory oversight

Wills example 2: ‘pressure selling’ techniques

Wills example 3: Misleading claims and potentially unfair terms regarding pricing of future services

Wills example 4: potentially unfair contract term allowing business to unilaterally change terms and conditions

Wills example 5: potentially unfair term which limits trader’s liability

Wills example 6: services carried out by a third party

Online divorce

Do and Don’t

Do

Don’t

Online divorce case studies

Online divorce example 1: misleading claims

Online divorce example 2: unfair limitation of liability

Pre-paid probate

Overview of consumer protection issues in the pre-paid probate sector

Practices likely to breach consumer law

Consumer savings schemes

Kate Briscoe

Employment Laws under the new government

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