The Law Society has warned that Civil Justice Council proposals to divert lower-value solicitor-client costs disputes from court to the Legal Ombudsman could overload a complaints system already facing record demand.
The warning forms part of the Society’s response to the CJC consultation on reforming Part III of the Solicitors Act 1974, the statutory framework governing solicitor-client costs challenges in England and Wales. Brett Dixon, the Society’s vice president, has backed the principle of modernisation but questioned whether the evidence supports moving extra work to LeO now.
The consultation, chaired by Mr Justice Adam Johnson, asks whether modest disputes over legal bills should move away from court assessment and into the Legal Ombudsman scheme, with larger matters subject to mandatory alternative dispute resolution before litigation. It also proposes an objective test that solicitors’ charges should be fair and reasonable, while removing the long-standing distinction between contentious and non-contentious business.
For solicitors and firm leaders, the issue is not only where disputes are heard but how billing risk is documented from the first client-care letter. The CJC paper links reform to uncertainty created by the current regime, including arguments over informed consent, the form of statutory bills and the interaction between professional conduct rules and costs assessment.
That means retainers, costs updates, damages-based agreements, conditional fee agreements and fixed-fee arrangements may all come under sharper scrutiny if the new model is adopted.
The Legal Ombudsman’s own data shows why capacity is central to the debate. In Q3 2025/26, LeO received 3,496 new complaints, up 37% on the same quarter in 2024/25, with complaint volumes for the quarter higher than any previous quarter on record.
LeO also reported that 47% of accepted complaint types concerned poor communication or delay, while £869,300 in remedies was awarded during the quarter. Adding costs disputes to that workload could shift pressure from the courts to an ombudsman process already being asked to improve speed, triage and early resolution.
The debate also matters for regulators. The Solicitors Regulation Authority, the Legal Services Board and the Office for Legal Complaints each have an interest in how consumer protection, professional conduct and redress fit together.
The Legal Ombudsman sits within the redress framework created by the Legal Services Act 2007, while the Court of Appeal decision in Belsner v CAM Legal Services Ltd and comments by Sir Geoffrey Vos, the Master of the Rolls, have already pushed the sector toward cheaper mechanisms for modest bill challenges.
Law firms should treat the consultation as a billing-governance issue rather than a technical costs reform. Better retainer language, clearer costs explanations, recorded client choices and early complaints handling will become more important if the Legal Ombudsman becomes the main forum for modest fee disputes.