Wednesday 05 June 2013 by John Hyde

The Legal Services Board is to formally investigate whether the Bar Council breached rules to interfere in a controversial decision affecting the cab rank rule.

The investigation follows information provided earlier this year about the council's role in representing its members.

Chris Kenny (pictured), LSB chief executive, has now written to the Bar Council after the information suggested 'potentially significant involvement' in an application made by independent barristers regulator the Bar Standards Board.

The BSB applied in October 2011 for a change in relation to the cab rank rule, which the LSB granted in July 2012.

The change enforced standard contractual terms between solicitors and barristers. Under the BSB scheme, if a solicitor seeks to instruct a barrister on its new contractual terms, the cab rank rule will apply.

The LSB investigation will ask if the Bar Council has undermined the principle of independent regulation and had an adverse impact on the public interest.

It will query whether the Bar Council failed to comply with internal governance rules (IGR) to ensure regulatory functions are kept separate from representative functions.

The LSB will also want to know if the Bar Council has been involved in any other actions which are relevant to regulatory independence.

The cab rank decision was closely scrutinised by the overarching regulator, with Kenny writing in January 2012 to BSB chair Lady Deech to raise concerns about the change. But the LSB could find no reason to refuse the application and it was approved.

It is unclear how long the investigation will take or what action might be available to the LSB.

The Bar Council has yet to formally respond.