Friday, July 29, 2011

Waiting for ABS....or Godot?

October will pass without Alternative Business Structures and it looks likely it will be the end of the year before we see them, unless you are a licensed conveyancer that is. In part this is due to the way parliamentary business is done and also to the manner in which appeals against Solicitors Regulation Authority decisions will be conducted. There is also the vexed question of what criminal convictions have to be disclosed by potential investors in ABS.

I'm sure we'll get there in the end even if parts of the legal profession wish this would all go away.

I was struck by Dan Bindman's column on Legal Futures, "Are you an ABS optimist or pessimist?" It's worth reading for the views represented on the potential effects of ABS. Dan ultimately says,
One thing is certain: the new entrants will have little regard for broader notions of access to justice, or the social value of having an independent legal profession to police the three-way interface between the state, the market and the individual.
We don't know this of course. And Dave Edmonds, chair of the Legal Services Board, comments,
Dan Bindman’s article poses the right questions. But I quarrel strongly with his assertion that new entrants will “have little regard for broader notions of access to justice”. Why will they not? Many of the most ambitious and innovative lawyers operating in the present marketplace have a very high commitment to this fundamental cause. My belief is that extending the ability of citizens to secure affordable legal advice from new forms of law firms (which will be in the main run by lawyers and properly regulated by regulators for whom access to justice is an underlying principle) will enhance access to justice, not diminish it.
Read the other comments also--there's good stuff there.

When it comes to dynamic change the legal profession has always been in the vanguard of resistance. It's almost a reflex action. Legal aid was resisted when introduced in the 1940s. Then lawyers learned how it would benefit them. They love it now! But that's going.

Lawyers were opposed to neighbourhood law centres because they thought they would take away business. Instead they promoted it. Their funding is being cut now.

The legal profession has a good eye for resisting winners and on that basis I think they might be on to something with their opposition to ABS. Just don't leave too late...

Friday, July 22, 2011

Is Solicitors from Hell a Criminal Conspiracy Against the Legal Profession?

(thanks to Byfield)

As I came out of the BBC yesterday with Des Hudson*, the chief executive of the Law Society, he said Rick Kordowski was a criminal. I reminded Des that the police didn't think so. He wasn't happy.

We'd both been invited to discuss Solicitors from Hell on Radio 4's You and Yours consumer affairs programme. For those of you who might not know Solicitors from Hell allows disaffected clients to write their stories about their dissatisfaction with their lawyers. At times the voices are plaintive, frustrated, and upset. A number of lawyers have sued Kordowski for defamation, except he's got no money. And recently a judge suggested the Law Society and the Bar Council take action against Kordowski and his website.

The BBC has put the story and the difference between Des and myself on their news website. You can listen to our discussion here: we are Chapter Three.

My view is quite simple. Whatever one thinks of Kordowski or his website, it serves a need. It demonstrates clearly that people need an outlet to express their feelings and concerns about how they are treated. Instead of attacking Solictors from Hell the Law Society should be doing something about those complaints. It should be preventing the need for a website like Solicitors from Hell. If there's no felt need, then no SfH.

Lawyers are improving their game--don't get me wrong--but far too slowly. In the first six months of setting up the new Legal Ombudsman received nearly 40,000 calls which turned into close to 4,000 complaints. And there is a backlog as well. But that's far too many complaints for a profession to have landing on its doorstep. It's still not an easy process to complain about bad legal services. It could involve the Ombudsman or it might the task of the Solicitors Regulation Authority. Certainly the Law Society website doesn't make clear about how to go about complaining except to give a link to the Legal Ombudsman. Take a look at its website home page and see how easy it is to locate the complaints section. It's not.

This is one of the reasons why government decided the professional bargain was no longer working and passed the Legal Services Act in 2007 and established an entirely new regime of regulators for the legal profession and legal services market. Professions have to be accountable to the public.


*Here's Des in a better mood and you can read previous posts on Solicitors from Hell from March, April, and June.


Saturday, July 02, 2011

Big is Phat?

(thanks to

Legal Futures guides us to an enlightening survey on law firms' ideas on the brave new world of ABS and Tesco Law. It appears interest is waning.

Baker Tilly, the accounting firm, has been surveying lawyers for two years now on their reactions and expected responses to the wild horizons before them. The latest survey for 2011 shows that law firms are orienting themselves towards the new markets but when it comes to external investment they are becoming increasingly shy.

Of firms with more than 25 partners interest in external investment has declined from 56% to 45% whereas in firms with less than 25 partners attraction has only dropped 9% to 53% of respondents. Baker Tilly argue that this is caused by partners realizing that their ways of working would have to change substantially if private equity investors so demand, which they would. From this perspective law firms are holding on to their conservatism and perhaps the autonomy of partners.

It's worth reading the Baker Tilly report on changes ahead, Climate Change: Forecasting the Impact of the Legal Services Act.  It tries to spell out how private equity operates and what an IPO would mean to firm members. For the traditional law firm partner the reading is grim, or perhaps one should say challenging. I've already written on how law firms should be valued for an IPO and that makes grim reading also.

This is in contrast to firms making all sorts of moves to improve internal management, possibly link with non-lawyer suppliers, but fewer are prepared to incorporate.

Maybe the changes reflect a growing acceptance of change happening and a more "relaxed" attitude to what the Legal Services Act might portend. I shall be keeping an eye on Baker Tilly's surveys for a few years yet.