In March this year lawyers in Scotland had voted to bring forward a proposed rule change but at the special general meeting yesterday 847 voted against the rule change while 671 were in favour.
In its newsletter the CML said: “We had previously offered to work with the Law Society of Scotland to address any concerns about the work conveyancing solicitors undertake for lenders especially any issues arising from the operation of the CML Lenders' Handbook of instructions to conveyancers.
“We now look forward to working together on sensible and proportionate solutions to any concerns while recognising that in most cases joint representation will best serve the interests of both the borrower and lender clients of conveyancing services.”
The president of the Law Society described the shift in support for separate representation since March as a “mood change”.
He said: “The majority of solicitors clearly believe that the current practice works for their clients although there remains a significant number of solicitors who have concerns.
"There has been a huge amount of work done in the interim and we have consulted widely with solicitors, the banks and their representative body the Council of Mortgage Lenders and consumer interest organisations.
“The responses to our consultation revealed the strength of feeling within the profession, whether for or against the proposed rule change, and have highlighted the sensitivities and complexities of such a proposed change."
In light of the vote the Law Society of Scotland is now considering its next steps.