The Legal Services Consumer Panel publishes paper on lawtech and the consumer

May 22, 2019

The Legal Services Consumer Panel, which was established under the Legal Services Act 2007 to provide independent advice to the Legal Services Board about the interests of consumers of legal services in England and Wales, has published a discussion paper on the opportunities afforded by the use of lawtech and how its use can benefit consumers of legal services.

The paper says that lawtech innovations can lead to new and more responsive legal services from improved access, positive consumer outcomes and competition, to increased profitability for businesses. However, lawtech also raises a number of risks for consumers, legal service providers and regulators. These risks can be mitigated if good consumer outcomes and ethics are central to the development of lawtech, supported by a robust regulatory framework.

The report also emphasises the potential for lawtech to address the access to justice gap, as well as boost competition in the legal services market and, to that end, the Panel has developed a checklist for regulators to use when supporting the profession and consumers in the use of lawtech. The Panel says that its checklist is rooted in well-established consumer principles.

The Panel also highlighted the need for adequate consumer protection to bolster consumer trust and confidence in lawtech.

The report considers various case studies, for example, including one on algorithm bias, and asks a series of questions:

  • Have regulators considered supplying incentives to providers to use lawtech services to widen access?
  • Have regulators considered issues around consumer choice in lawtech services?
  • Are lawtech services transparent, traceable and auditable, is there a plain English guide for providers on how to explain automated decisions to consumers?
  • Do regulators require any ongoing quality assessment of lawtech solutions?
  • Has the regulatory framework been adapted to deal with potential biases in the data sets used in lawtech services?
  • Does the existing redress mechanism need to be adapted to protect consumers?
  • Have regulators considered adapting their regulatory framework in determining where liability lies, especially where the circumstances are not clear-cut?
  • Are consumers represented at all stages of the developing the lawtech solutions?
  • Are there regulatory barriers to innovation?
  • Are regulators using the CPD framework to support the profession to use lawtech safely and effectively?

The report compares lawtech with fintech and healthtech and in particular concludes that fintech is a more mature model than lawtech.