Helen Grant MP - Modern Law Magazine

Modern Law Magazine | January 2013 | Issue 4
Charlton Grant
The Business of Law
January 2013 | Issue 4 | ISSN 2050-5744
“There has to be a
mindset – even in
new ABSs which
have attracted
finance – to invest
today, to become
the winners of
tomorrow,”
Doug Crawford,
myhomemove
Helen Grant MP
“Yes, I would expect people to be shopping around in terms of legal
services. This is a good thing; there will be more competition in
terms of fees and what firms choose to charge,” Helen Grant MP
Supported by Sponsored by
Dominic Regan considers litigation in the
new, post reform age and predicts where
the tensions are most likely to erupt.
Sector Roundtable: MLM hosts a gathering
of senior practitioners, experts and industry
associations in the Personal Injury sector.
Richard Susskind exclusive: The author
gives Modern Law the low-down on his
new book.

MAKE A
WINNING
DECISION
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more than just a conveyancing search company

MoDERn LAw ConfEREnCE
ABS – One Year on - The New Legal Frontiers
1st May 2013
The Royal College of Surgeons, London
WelcoMe
happy, prosperous new year to the legal scene!
A I know I’m not the only one entering 2013 on a
wave of positivity. There are plenty of practitioners,
consultants and experts in the field who share the
same enthusiasm for new opportunity in spite of
change - most of whom share their thoughts on
business practice and planning for 2013 in this fullycharged
issue.
So if you are suffering from the January blues, take
some time to sit back with Modern Law and let me
know what you think about the advice, opinions
and updates. Has it helped, did they get it right
and what’s missing? Get in touch via the website:
www.modernlawmagazine.com or email me:
emma.waddingham@charltongrant.co.uk
I hope to see you all at the industry-leading Modern
Law conference on 1 May 2013, chaired by Michael
Napier QC CBE, held at the Royal College of
Surgeons, London (full details above).
Here’s
Modern Law, the flagship for new ideas in the
new legal era.
Emma Waddingham, Chief Editor
Modern Law Magazine Issue 4 – January 2013 | ISSN 2050-5744
Project Director
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Chief Editor
Emma Waddingham
Editorial Department
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Production
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Events Manager
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PRoGRAMME
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Introduction 03
TICKETS
£165
+VAT
08.30 REGISTRATIon
09.00 ChAIRMAn’S wELCoME Michael napier CBE QC
09.15 KEYnoTE ADDRESS – PuTTInG ConSuMERS fIRST
Helen Grant MP: Parliamentary Undersecretary of
State, Minister of Justice
09.25 KEYnoTE PAnEL– PuTTInG ConSuMERS fIRST
Helen Grant MP, Parliamentary Undersecretary of
State, Minister of Justice
Jonathan Djanogly MP, Former Minister of Justice
Bridget Prentice: Former Minister of Justice
10.00 ABS: how IS IT foR You?
Christina Blacklaws: Co-Op
David Beech: Knight’s Solicitors
Mark Savill: Lyons Davidson
Tim Oliver: Parabis Group
Andrew Twambley: Amelans/InjuryLawyers4U
Anthony Hughes: Horwich Farrelly
Joe Simpson: Irwin Mitchell
Neil Kinsella: RJWSlaterGordan
11. 30 MoRnInG REfREShMEnTS
12.00 InvESTMEnT: how IS IT foR You?
Steve Arundale: Natwest
John Llewelyn-Lloyd: Espirito Santo
Iain Kenedy: Duke Street
Trevor Howarth: Stobarts
Robert Terry: Quindell Group
Jordan Mayo: Smedvig Capital
13.15 LunCh
14.15 EThICS: InDEPEnDAnCE, ConfLICT,
CoMPLIAnCE, ConTRoL – ARE ThE
REGuLAToRS hAPPY?”
Chris Kenny: Legal Services Board
Antony Townsend: Solicitors Regulation Authority
Adam Sampson: Legal Ombudsman
Ewen Macleod: Bar Standards Board
Patricia Greer: Law Society
15.30 “IS ThE MARKET MovInG fAST EnouGh?”
Stephen Mayson – Legal Services Institute
16.00 CLoSInG REMARKS Michael Napier CBE QC
16.15 DRInKS AnD CAnAPéS
Modern Law Magazine is published
by Charlton Grant Ltd ©2012.
Contact t: 01765 600909 or e: info@modernlawmagazine.com Modern Law Events: www.modernlawevents.co.uk
All material is copyrighted both written and illustrated. Reproduction in part or whole is strictly forbidden without the written permission of the publisher. All images and information is collated
from extensive research and along with advertisements is published in good faith. Although the author and publisher have made every effort to ensure that the information in this publication was
correct at press time, the author and publisher do not assume and hereby disclaim any liability to any party for any loss, damage, or disruption caused by errors or omissions, whether such errors
or omissions result from negligence, accident, or any other cause.
ML // January 2013

04
contentS
03-09 InTRo & ThE nEwS
07 Dominic talks news
Dominic Regan considers litigation in the
new, post reform age and predicts where
the tensions are most likely to erupt.
11-17 ThE InTERvIEwS
11 Interview with...
Richard Susskind
Antony Smith speaks to Richard
Susskind on his latest book, ‘Tomorrow’s
Lawyers’ – about what the next
generation of lawyers can expect from
their working hours.
13 Eat Lunch or be lunch
Waking up and addressing change in the
legal industry is do or die and as Arlene
Adams reports, the value of data and
technology needs to be realised in the
fight to survive.
15 Interview with...
Doug Crawford
The CEO of ‘myhomemove’ is
steering further growth to the leading
conveyancing ABS’s. As he explains to
Emma Waddingham, success to date is
investment in people and the systems
they use to carry out the company’s
commitment to customer service.
Agnieszka Scott
Director of Policy
Solicitors Regulation
Authority
Alan nesbit
Managing Partner
Nesbit Law Group
Andrew Stenning
Managing Director
Searches UK
Angela Moore
Partner
Jarvis Family Law
Anthony Glaister
Mediator
Contents
editorial coluMniStS
Allan Carton
Managing Director
Inpractice
ML // January 2013
Alistair Kitching
Group & Sales
Marketing Director
Esteem Systems Ltd
Antony Smith
Director
Legal Project Management
Bernard George
Director
Socrates Training
Barry Talbot
Managing Director
Informance Limited
Catherine Bailey
Managing Director
Bar Marketing
Charles Christian
Editor in chief
The Orange Rag
19-35 ThE vIEwS
20 Referring to financial advisers
Agnieszka Scott, Solicitors
Regulation Authority
20 Looking for evidence
Chris Kenny, Legal Services Board
21 Do you know where you’re going?
Steven Arundale, RBS & Natwest
21 Putting technology first
Jo Hodges, Redbrick Solutions
22 A modern education
Noel Inge, ILEX Tutorial College
22 A sustainable price war?
Robert Parness, Paramount Legal Costs
23 Commoditisation v specialisation
Angela Moore, Jarvis Family Law
23 The point of impact: RTA portal costs
David Bott, Bott & Co.
24 If it looks like a duck...
Eddie Goldsmith, Goldsmith Williams
24 The longevity of specialists
Charles Christian, The Orange Rag
25 organisational force
Mark Witter, Anglia Research Services
25 Informed decisions
Barry Talbot, Informance
Chris Kenny
Chief Executive
Legal Services Board
David Bott
Managing Partner
Bott & Co
Professor Dominic Regan
Legal commentator, trainer
and costs expert
Eddie Goldsmith
Partner
Goldsmith Williams
Eimear McCartan
Solicitor
Ralli Solicitors
faye Stenning
Inside Conveyancing
Guy hewetson
Partner
Hewetson Shah
Jaunita Gobby
Director
Legal Eye
Jo hodges
Managing Director
Redbrick Solutions
Mark witter
Anglia Research
11
15
Matthew williams
Head of AmTrust Law
AmTrust Financial Services.
neil hudgell
Managing Partner
Neil Hudgell Solicitors
20
noel Inge
Managing Director
ILEX Tutorial College
Paul wilkinson
Lawclient Ltd
Rob hailstone
Bold Legal Group
Robert Parness
Costs Lawyer
Paramount Legal Costs
Steven Arundale
Head of Professionals
Sectors, Commercial Banking
RBS & Natwest
Steven England
Litigation Support Consultant
K2 Legal Support

27 new year, new requirements
Jaunita Gobby, Legal Eye
27 what’s the worst that could happen?
Bernard George, Socrates Training
29 Acting in the client’s best interest
Andrew Stenning, Searches UK
29 Ready for a new dawn
Eimear McCartan, Ralli
31 Configured to compete
Allan Carton, Inpractice UK
31 Barristers take centre stage
Guy Hewetson, Hewetson Shah
32 Commercial claims: application
and cover
Matthew Williams, AmTrust
Financial Services
32 Are associations relevant in the
ABS world?
Rob Hailstone, Bold Legal Group
33 The ABS Landscape one Year on
Faye Stenning, Inside Conveyancing
33 Communicating the changes: the
role of the lawyer
Catherine Bailey, Bar Marketing
35 Back to the future: Part 51
Steven England, K2 Legal Support
35 Enabling secure data access for ABSs
Alistair Kitching, Esteem Systems Ltd
37-49 ThE fEATuRES
37 Sector Roundtable: Personal Injury
MLM hosts a roundtable of experts and
champions across the personal injury
divide (including industry organisations
MASS, FOIL, ABI and ARC),to pinpoint
such issues as reform fear and who have
and haven’t been consulted and why. As
well as thoughts on the new world of PI
litigation; the winners and losers.
41 Interview with...helen Grant MP
Emma Waddingham speaks exclusively
to Helen Grant MP, Parliamentary
Under-Secretary of State, Minister for
Victims and the Courts, about LASPO,
tackling fraud and the burden of
business planning for practitioners and
their organisations in light of new (and
still unclear) regulatory boundaries.
43 LASPo fiasco
Russell Smart, Elite Insurance Company
45 Reality check
Paul Addison stresses the importance
of checking the current and future
development landscape near a property
to keep house-buying clients happy.
47 A bird’s eye view
Riverview is one of the new breed of
legal businesses created to deliver
corporate legal work based upon the
premise that law is just another business
service. Karl Chapman, Riverview’s CEO,
talks to Mike Ames about the inner
workings of the company.
49 who’s been saying I’m paranoid?
As personal injury lawyers are rumoured
to be sharpening their teeth to steer
towards professional negligence claims
from fast-track cases, Tony Walton
points out some key reminders to
professional peers.
51-62 BuSInESS MAnAGEMEnT
53 Practical help for challenging times
Antony Smith reports on a key
conference aimed to add fuel to legal
‘machines’, with a particular focus on
what firms are doing right in terms of
structure and marketing ahead of a
stressful year ahead.
54 what do new entrant ABSs have to
do differently to win more work?
Jitendra Valera, IRIS Legal
55 watching, waiting, innovating?
Richard Forth asks if unprecedented
change offers more opportunities
to work with outsourced expert
consultants and if they are innovating
their offerings for clients, as well as
addressing change in the PI sector.
57 RTA Costs Reduction:
the business impact
Alan Nesbit, Nesbit Law
57 Trends in legal service delivery
Antony Smith, Legal Project Management
58 A fixed fees conundrum?
Paul Wilkinson, Lawclient Ltd
59 Effective dispute resolution
Anthony Glaister, MCIArb
60 why protect the specialists?
Neil Hudgell, Neil Hudgell Solicitors
60 Capturing time on the go
Mick Thompson, Eclipse Legal Services
62 Layering up
As innovators prepare for the April
reforms, Phil Bellamy outlines his
predictions for change in the After-The-
Event (ATE) insurance sector.
41
43
47
Contents
05
ML // January 2013

DoM REGAn neWS
Litigating in the new world
The detailed Rules to finesse
the Jackson measures and to
deal with the critical issue of
transitional measures will appear
from January 2013. The Government
and Judiciary are committed to April
implementation - it is going to happen.
My aim here is to consider the
landscape after the reforms kick in
and where the tensions are most likely
to erupt.
An insult to injury?
In injury, the arrival of qualified one
–way costs shifting (QOCS) can only
increase the number of claimants.
Subject to limited exceptions the
claimant is not at risk of paying costs
should they fail. Temple, the prominent
after the event (ATE) insurer in this
arena, is going to provide cover
against adverse risks in respect of
disbursements incurred by a claimant.
This is good news, for it is not much
joy for the client to be immune from
costs if they then face a daunting bill
for their own, irrecoverable outgoings.
What is less clear is how insurers
/ defendants will react. Arguably, we
have been here before since QOCS
is but a hideous acronym for a legal
aid model, i.e. a winning claimant
gets costs but defendant must bear
own costs even if successful. In years
gone by Lord Denning MR spoke of
the ‘blackmail effect’ and at a recent
conference it was said that defendants
might feel obliged to pay ‘blood
money’ (their phrase, not mine). The
economic imperative might well be
to make an early, low Part 36 offer to
put the claimant under early pressure.
The risk for a claimant is that if they
fail to take an offer which they fail to
beat, their entire pot of damages (but
no more) is at jeopardy since it will
be diverted to meet the costs of the
successful defendant. This risk strikes
me as one which will make claimants
more hesitant to press on and,
arguably, could provoke the lowering
of settlements; something being better
than (possibly) nothing.
‘this risk strikes me as one which will make
claimants more hesitant to press on and,
arguably, could provoke the lowering of
settlements; something being better than
(possibly) nothing.’
Portal in play
Portals! No other word provokes such
anxiety and hostility amongst the
injury fraternity. From those in road
traffic we know for certain that the
threshold for claims is to be increased
to £25,000. This is almost meaningless
for two reasons. The first is that not
many cases fall within the increased
bracket. The other, from Sir Rupert
himself over a tea and digestive, is
that the higher the value the more
likely it is that insurers are going to be
Dom Regan News 07
more circumspect. It is one thing to
chuck the towel in on a £2,000 claim
but would one behave the same if it
were for £22,000? The portal operates
upon a quick admission, no questions
asked basis which is inimical to more
substantial matters.
The fees agreed and implemented
as recently as April 2010 are to be
slashed. The recent Government
consultation (sic) talks of cutting
the usual fee from £1200 to £500.
‘Consulting‘ when you have made your
ML // January 2013

08 Dom Regan News
‘not for the first time would it be a case of government softening up the
recipients of bad news by suggesting a very bad outcome, only to foist a bad
outcome instead. My mole says £650. But no one knows anything for sure.’
mind up and promised insurers so, is despicable. For what it is worth, I am told
that they have a slighter higher figure in mind. Not for the first time would it be
a case of government softening up the recipients of bad news by suggesting a
very bad outcome, only to foist a bad outcome instead. My mole says £650. But
no one knows anything for sure.
Beyond road traffic, the Government is obsessed with a new portal for
employers’ liability and public liability claims. I am certain it will be an abysmal
failure. Interestingly, the Italian company in charge of the project wrote to the
Ministry of Justice in November saying it could not guarantee a viable working
model in April 2013. How astute. Even if they were to cobble something
together I consider that a vast percentage of cases would exit the regime. As
it is, 49% of road traffic cases drop out and they are - with respect - generally
straightforward when contrasted with the intricacies of employer liability.
Commercial anagrams
In the commercial sector, I can guarantee that Firstassist - again an eminently
reputable provider (in my opinion) - will continue to offer ATE cover but also,
excitingly, funding too since it was recently acquired by Burford, a major and
creative player in the United States.
The red hot topic in this field is the arrival of contingency fees, aka damages based
Agreements (DBAs). The allure is obvious; one will be able to act in a litigated
matter in return for a naked cut of the winnings not to exceed 50%. I cannot wait to
see the January regulations. Sir Rupert recommended that the client would always
have to be sent off to seek independent legal advice. This was initially criticised as
otiose but more recently practitioners have realised that it could be a life-saver.
Let us take the example of a claim for negligence worth £1,000.000 (give or
take) where the solicitor is prepared to act in return for 40% of the winnings, i.e.
£400,000. Miraculously, the defendant caves in after a month or two whereupon
the client becomes hostile towards his or her own awesome solicitor. ‘You wrote 20
letters for me at a cost of £20,000 a letter’ they whinge. You point out that they
were long and effective letters and stamps cost more than they used too. Had the
client been sent elsewhere for advice about the suitability of the arrangement then
one would be so much more confident about the deal being upheld; this is critical.
The Law Society is to be congratulated for just having established a
committee to look at producing a model DBA.
‘the inelegant but accurate phrase ‘race to the
bottom’ is apposite. Will those desperate for
work at almost any price ultimately agree to
accept base costs only from the other side,
leaving their client with a full recovery?’
Getting wobbly over CfAs
Our next area of uncertainty is the viability of the conditional fee agreement. They
will continue but, for those created post –reform, the client will pay the success
fee – assuming of course that anyone does. No longer will it be recoverable from
ML // January 2013
defendant. The real challenge will be
to persuade a client to forego part
of their hard earned winnings to pay
you. Watch this very carefully. The
inelegant but accurate phrase ‘race
to the bottom’ is apposite. Will those
desperate for work at almost any price
ultimately agree to accept base costs
only from the other side, leaving their
client with a full recovery?
‘Beyond road traffic,
the Government is
obsessed with a new
portal for employers’
liability and public
liability claims. i am
certain it will be an
abysmal failure...’
Putting it into proportion
The final area of uncertainty is the
application of a new proportionality
test. Contrary to what was said at a
recent mediation conference, hosted
by BLM in London, Sir Rupert Jackson
did not veto the proposal that a
Practice Direction be produced. On
the contrary, he is so understandably
anxious to avoid futile and expensive
satellite litigation of any kind
whatsoever.
In my last article [MLM issue
3, November 2012] I wrote about
budgeting and I will not re-visit
that territory, save to make the tart
observation that if you can agree
your budget with your opponent then
you avoid awkward and unwelcome
Judicial intervention.
Professor Dominic Regan
www.profdominicregan.blogspot.com

There is a future for lawyers
prepared to adapt, build on
their strengths and learn
from other business sectors.
We can help you gear up
and make it happen.
To develop a successful legal business
solutions@inpractice.co.uk
www.inpractice.co.uk
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New
Tricks

Interview with...
ricHard SuSSkind
Professor Richard Susskind oBE is a British
author, speaker, and independent adviser
to international professional firms and
national governments.
Anthony Smith speaks to Richard
Susskind on his latest book,
Tomorrow’s Lawyers (published
January 2013).
QIn some ways this may be
your least radical book, for
instance, there are examples
of law firms and new legal service
providers already doing some of the
things you suggest. Does this mean
the legal industry is now past the
‘new ideas’ stage and into the ‘new
delivery stage’?
a
Tomorrow’s Lawyers is intended
for young and aspiring lawyers,
as well as for older lawyers who
could not bring themselves to buy or
read a book called The End of Lawyers?
(My last book.) It brings my thinking
up to date, but lays it out in shorter
form than my earlier books. There is a
lot of new thinking in there too - I like
to think - not least about what the next
generation of lawyers should expect
to be doing in their working hours.
For readers who are familiar with my
past work, the new book may seem
less radical but, for the great majority
of practising lawyers, most of whom
(alas) have not read my stuff, this work
will seem not just radical but seditious.
It is true that some law firms have
moved from ideas to action but they
are still the exception.
Qnotwithstanding the above, I
think some practising lawyers
will be affronted by some
of your assertions, in particular the
following two:
• ‘for much of the legal market the
(business) model is not simply
unsustainable; it is already broken
• ‘I do not see much of a future
(beyond 2020) for most small
firms in liberalised regimes’
what do you say to people who
would dispute these views?
aI say, ‘speak to clients’. Almost
all the General Counsel with
whom I meet tell me that they
are under huge pressure to reduce
their legal spend and that law firms will
need to transform to help them make
these reductions. Equally, look at the
research into individual consumers and
legal services – a majority suggest that
customers would be more comfortable
securing legal help from a high street
brand than a conventional law firm.
QYou refer to lawyers struggling
to meet the ‘more for less’
challenge. Most lawyers will
understand what this means, but how
would you summarise this challenge?
aThere are three elements.
In-house legal departments
are under pressure from CEOs
‘My advice is to move from pricing
differently to working differently; above all to
implementing new and much less costly ways of
sourcing routine and repetitive work’
Interview 11
and CFOs to reduce their internal
headcount, to spend less on law
firms, and yet they have more legal
and compliance work than ever
before. So, these clients need more
legal service at less cost and this
challenge will define the next 10
years of the legal industry.
QYour advice to lawyers
needing to meet the ‘more for
less’ challenge?
aMy main suggestion is to stop
thinking about this challenge
as a call for alternative fee
arrangements. Much of the debate
on alternatives to hourly billing is
misdirected because when most lawyers
move, say, to fixed fees, they are still
working out these fees with an hourly
billing model in mind. My advice is to
move from pricing differently to working
differently; above all to implementing
new and much less costly ways of
sourcing routine and repetitive work.
ML // January 2013

12 Interview
QMany lawyers say clients want to ‘speak to the
lawyer doing the work’ (and this is a selling point
for many firms), so is decomposing and the
perhaps outsourcing realistic?
aThe idea here is that we can break down deals
and disputes into component parts and source
each part as efficiently as possible. For the routine
and repetitive work, this might call for off-shoring or
outsourcing or computerising (or one of the rest of the
15 alternative ways of sourcing legal work that I have
identified). Generally, and here is the key, clients don’t want
to see the lawyers who are doing this kind of work. They
only tend to want to speak to lawyers who are undertaking
the complex, bespoke work. But, on my model, that kind of
work stays with traditional lawyers who will interact with
their clients in the way they always have done.
QYou also advocate collaboration between law firms.
Is it realistic to suggest to firms who compete against
each other that they should now collaborate?
aIf left to their own devices, law firms will not tend
to want to collaborate. However, a number of very
major clients have recently been asking their panel
firms to collaborate. This drive from clients changes the
tune. Law firms have to make it ‘realistic’.
QA surprise in the book is that you have very little
time for AfA’s, including value pricing. why is this?
aI have already said something about AFAs. They do
not, in my view, change the price of fish. Value billing
is superficially attractive but misses a crucial point
– that even if a law firm delivers great value, clients will not
wish to pay more than the going market rate. Tax lawyers
who say to a client they want a cut of the action because
they have saved the client £x million will only succeed if
they are the only firm that could have delivered that value. If
others could have recommended a similar scheme, then the
market will trump the value as an index of price.
QBut if a law firm has become more efficient and
reengineered its legal service delivery, surely there
is inherent value in that, which they can then seek
to reflect in their pricing?
aI agree. If a law firm reengineers, it can take advantage
of the savings by being able to offer a lower cost
service to clients (or by achieving a greater profit
margin; or both). Again, it is all about the market and clients.
There is value for the client, in your sense, if the client pays
ML // January 2013
‘Many deals and disputes are complicated, resource
intensive, document intensive, high pressure activities that
deserve the rigour project management can bring.
too often, today’s lawyers are haphazard and ad hoc in
their matter management’
less. But when most people talk of ‘value pricing’ or ‘value
billing’ they mean charging according to the overall value
delivered to the client as opposed to the numbers of hours
spent by the firm. They are saying look at output rather than
input. I say the market sorts out pricing (methods and levels).
QYou are actually quite optimistic about the
employment opportunities for tomorrow’s lawyers,
why is this?
aRead the book for this one. There I lay out a whole
new set of new jobs for lawyers.
QYou have long been a vocal proponent of legal
project management – why do you believe a project
based legal service delivery model is so important?
aBecause many deals and disputes are complicated,
resource intensive, document intensive, high
pressure activities that deserve the rigour project
management can bring. Too often, today’s lawyers are
haphazard and ad hoc in their matter management.
QYou implore young lawyers to ‘work in the law
in the interests of society and not of lawyers’.
Some would say this is overly idealistic and that
- to quote the famous phrase - there is ‘no such thing as
society’. what would you say to that?
aI want lawyers of tomorrow to be passionate about
access to justice and the rule of law. I would like
them to make a good living but for that to be a biproduct
and not a prime objective of working in law. It may
be idealistic but I like to pursue ideals.
QA consistent theme in your writing has been the
need for greater access to justice and trying to
satisfy the ‘unmet legal need’. would you agree
that, compared to all other suggestions made in your
other books, progress has been slowest here?
aNot at all. It is of course hard to measure. But I think the
wealth of government websites and sites put up by the
third sector have made simple legal guidance far more
widely available and easily accessible than in the past. But we
are just warming up. Wait for online dispute resolution.
Richard Susskind OBE
MLM would like to thank Anthony Smith, Director, Legal
Project Management for conducting this interview.

eat luncH or Be luncH
waking up and addressing change in the legal industry is do or die and as Arlene
Adams reports, the value of data and technology needs to be realised when
negotiating the future of your legal services provision.
The legal market is
undergoing seismic
change. It’s not a threat of
something that may happen; it’s
happening now. If you wait to see
how the market plays out, you
will be too late. On a daily basis I
engage with businesses, existing
law firms and new entrants alike, who are plotting and taking
action to radically change how legal services are delivered.
In five years’ time the landscape of legal services will
be very different. There will be more legal providers of a
larger scale. They will adopt business models that are highly
automated and largely technology driven. We will also see a
surge of boutique firms focusing on specialised work. Again,
they will use technology but with a focus on using data to
provide a highly personalised and relevant service. It is likely
that some of the largest and most successful legal providers
in 2017 will be names we haven’t even heard of yet.
It’s already happened in other markets and it will happen
in legal. Take retail for example. Before the adoption of
the Internet no one had heard of Amazon. Now it’s one of
ARS_185x125 15/3/06 7:01 pm Page 1
the most successful companies on the planet. Traditional
Lost heirs?
Unclaimed assets?
Interview
retailers lost out to a business that used technology to
transform how services are delivered in their market.
Many large companies waited too long and in the end
became victims of their own denial. Technology has
changed the way we all interact and consume services and
understanding this is vital to any business strategy.
Recent research commissioned by Peppermint
Technology, across 1000 consumers and 150 businesses,
found that legal clients are increasingly demanding
new, technology driven models of consumption (www.
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Firms must embrace technology,
and the client, at the core of their business if they are to
deliver a quality service, every time, anywhere, anytime.
Like Amazon, firms must focus on becoming data driven
businesses and turn this data into value. Only with
technology at the core of the business will firms be able to
deliver high quality services at the right price point.
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must realise it is a fight for survival; you either eat lunch or
become lunch.
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Interview with...
douG craWford
Doug Crawford, Chief Executive officer of myhomemove
has been steering further investment to help grow the ABSs
conveyancing market share over the next five years – currently
listed as 3%. however, as he explains to Emma waddingham,
success to date isn’t simply being the first ABS off the block or
private equity funding, but investment in people and the systems
they use to carry out its commitment to customer service.
Qhas the vision for myhomemove exceeded the initial expectations
and has the business plan changed in the last five years?
a
The company received private equity funding from Smedvig
in 2005, before the recession. Despite initially envisaging an
exit plan of 3-5 years, post- recession it reset its expectations
and committed to further growth and investment. It paid off. By 2012
the market share of myhomemove had grown to 3% of the national
conveyancing market and we are firmly aiming to capture 10% of the
market in the next four years – more than exceeding expectations!
Qwhat have you had to do differently (in terms of competitors)
to achieve this?
aInvestment has been a key area; particularly in technology and
people – the latter to support the delivery of a personal service. Our
processes are as automated and efficient as we can make them but
the delivery is still achieved through skilled people to ensure we put the
client at the heart of what we do. This is absolutely central to the success
of myhomemove – this focus on service demands that conveyancers’
systems are as efficient as possible to help us deliver. But it’s not about
production lines; we have personal processes, combined with the most
effective and developed technology to assist our professionals.
Qhow has being an ABS helped the organisation, above any
other model?
aWe were the first ABS to launch in the UK, making use of
external investment behind the business to be well placed to
enter the market. But our success tomorrow is about investment
today. There has to be a mindset – even in new ABSs which have
attracted finance – to invest today, to become the winners of tomorrow.
External investment into a law firm enables them to invest in the future
but sometimes the structure of an ABS model is what’s needed to
make the most of that funding. In terms of myhomemove, we’re well
placed to further our success through the ABS model – along with the
commitment of our private equity (PE) funding source. While some
PE houses may have walked away at the first sight of trouble, Smedvig
continued to grow its investment in 2010 – a bad time for the market. It
will increase investment suitably if needed to reach our growth targets
and has no plans to exit. This puts us in a strong position, to have a
proven track record, brand, funding and expertise thanks to the model.
Interview
“there has to be a
mindset – even in
new aBSs which have
attracted finance – to
invest today, to become
the winners of tomorrow”
MYhoMEMovE –
ThE fIRST ALTERnATIvE
BuSInESS STRuCTuRE
myhomemove was established in 2000
and has grown rapidly to take 3% of the
overall conveyancing marketing share. It
provides a direct conveyancing service
through its in-house firm, Premier Property
Lawyers (PPL), regulated by the Council for
Licenced Conveyancers. The ABS continues
to secure investment funding from private
equity house Smedvig.
It also provides panel management
for estate agency and financial services
introducers - with a panel of lawyers,
which may include PPL, to provide their
conveyancing services. It offers a range
of conveyancing, panel management and
fraud risk reduction services for lenders.
Having developed its own specialist
system in-house, eWay, myhomemove was
awarded ‘Innovator of the Year’ award at
Mortgage Finance Gazette Awards 2011.
15
ML // January 2013

16 Interview
Qhave we seen any real innovation in terms of ABSs to date?
aNo, but it’s early days. We will see innovation increase as the
number of ABSs grows. It’s not a question of ‘if’ we’ll see
innovation but when.
Qhow has myhomemove gained 3% of the overall market share
(currently one in 20 transactions). what do you put this down to?
aTwo factors; firstly, technology. We have internally developed an
award-winning system, eWay, for case management, tracking
and client-facing processes. These market-leading, specific
innovations have been the core of our success and we continue to
roll out a version of eWay to introducers and panel management –
available also to panel members. This ensures a consistent and in-house
approach to all cases. We have a team of internal developers which we
are increasing by 30% in 2013 to increase the capability to invest and
develop our systems as we sit fit for the market.
Secondly, our people. We deal with people on a daily basis, either
with those introducing new business or with those moving house. It’s
a stressful time of life and while technology enables the efficiency and
communication, it’s people that deliver and empathise with the client to
ensure a high calibre of service. When looking to employ staff we look at
a number of elements to ensure they will fit in – there are plenty of legally
qualified people out there but they have to share our clear values about
focusing on the client and customer service. British businesses traditionally
underestimate mindset when employing staff. As a company you need to
engage with your employees and create a culture within the company – a
‘this is how we do things around here’ approach that everyone subscribes
to. It’s essential to invest in how you get people to feel a part of what
the brand is doing. We don’t see this investment – time or financial - as a
cost. People put too much focus on investment and capital opportunities
when discussing and even planning ABS’s. You’ve got to have a strong,
committed team of people working with you and that means you’ve got
to train everyone – continuously – as the vision and objectives develop. It’s
not enough for those funding and directing to know where the company is
going or for marketing to know the brand values.
“British businesses traditionally
underestimate mindset when
employing staff. as a company you
need to engage with your employees
and create a culture within the
company – a ‘this is how we do things
around here’ approach that everyone
subscribes to. it’s essential to invest in
how you get people to feel a part of
what the brand is doing”
ML // January 2013
Doug Crawford,
Chief Executive officer,
myhomemove
Doug was appointed as Chief Executive
Officer of myhomemove in April 2012 and
has a track record of delivering ambitious
plans for future growth. He is passionate
about leading the transition of companies
into exceptional customer service led and
values based organisations in order to
differentiate them in often crowded and
rapidly changing markets.
Together with his senior management
team, Doug aims to increase market share,
transaction volumes and profit. He has led
several financial and insurance industry
focused companies, most recently as Chief
Executive of Personal Touch, a financial
services network.
Qwhat holds your competitors back?
aProbably a lack of recognition of the
need to invest so significantly into
technology and people – as well as the
culture. There is a difference of opinion about
what is meant by investment but for clarity
I mean cost and time. There’s no doubt that
our investments have put us ahead of our
competitors so significantly.

“there is a difference of opinion about what is meant by
investment but for clarity i mean cost and time.
there’s no doubt that our investments have put us ahead
of our competitors so significantly”
QLooking at the conveyancing market itself, what
would Sep Rep do to the sector, for lawyers and for
clients?
aFrom the client’s perspective it potentially costs
more and slows down the process – it’s hard to see
the benefit for the client. However, it could mitigate
mortgage fraud and I understand that lenders would see
this as a positive step. Lawyers, meanwhile, depend upon
pricing and panels. The panel situation (especially the fall
out after HSBC) has really highlighted the fact that lenders
panels will get smaller and fewer law firms will end up on
them. Panel issues follow a trend of natural consolidation
as the top 100 conveyancing firms hold 26% of the market
share. Smaller firms cannot viably service the panels and
the larger ones will get larger and possibly even merge
further.
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Interview
???? 00 17
QIs the future of the conveyancing market now a fully
commoditised one?
aI don’t think it’s fully commoditised - there are still
opportunities to differentiate, although it requires an
enabler, such as a funder. Myhomemove will continue
to differentiate the proposition to market and compete on a
number of bases. We’re not going towards a commoditised
service based on price but have a clear view going forward -
on our own terms, not perceptions of the market. The client
ultimately comes first.

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The views 19
ML // January 2013

20
The views
Solicitors referring to
financial advisers
The Solicitors Regulation
Authority (SRA) has decided
to allow solicitors to refer clients
to any type of financial adviser,
regardless of how they are
classified by the Financial Services
Authority (FSA).
The Board agreed that the
Solicitors Code of Conduct be
amended to allow solicitors to put clients ‘in a position
to make informed decisions about referrals in respect of
investment advice’. Solicitors often refer clients to these
advisers to provide financial services, and provisions in the
SRA Code of Conduct lay out the rules for these instances.
The SRA needed to ensure that best outcomes
for clients are achieved and there is a risk that only
allowing solicitors to refer to those advisers deemed
‘independent’ by the FSA - as the rules currently stand -
might be contrary to that aim.
A consultation on the issue was launched in July,
where the SRA set out the benefits of such a move as:
• supporting outcomes-focused regulation as it does
not prescribe how the outcome must be achieved;
• making the solicitor ensure the client understands the
implications of a particular recommendation;
• ensuring the client is involved in the decision-making
process, and;
• removing restrictions of customer choice, if seeking
financial advice referral through a solicitor.
The consultation asked respondents to highlight any
issues the SRA had not already identified and considered.
We had an excellent response to our consultation and
we’d like to thank all those who responded. However,
nothing changed us from our belief that the best way
forward was to implement our preferred option.
It represented the best fit with outcomesfocused
regulation as solicitors, as highly qualified
professionals, would be free to assess and discuss
clients’ needs, not be restricted by a prescriptive
rule. It needs to be noted though that following the
feedback we received, we did introduce a minor
change to further protect vulnerable clients.
At the time of writing, the proposed handbook
change was with the Legal Services Board for approval.
If approved the amendment would be implemented
from 1 January 2013.
Agnieszka Scott, SRA Director of Policy.
ML // January 2013
Looking for evidence:
new LSB online resource
Since we started operating
in 2009 we have repeatedly
reiterated the importance of
evidence based policy. We want to
minimise and indeed move away
from anecdotal evidence in policy
making. Why? Because we think
better evidence will lead to better
regulation. Better regulation in
this context means consideration of the perspectives
of consumers and their legal needs, the promotion of
competition, and the protection of the public interest
in relation to the law. It also means evaluating long
standing rules to assess whether they are still necessary
and avoiding unnecessary regulatory burden through
developing targeted and proportionate regulation.
That means developing a better evidence base
(to which research is a key contributor), to ensure
that consumer, public, and professional interests are
considered objectively.
The Legal Services Board has led from the front in
highlighting the importance of research, prioritising it
as an issue and commissioning various reports across
a range of areas. For example we commissioned the
Regulatory Policy Institute to take a critical look at the
economic rationale for legal services regulation. We
used shadow shopping to test quality in will writing
legal services. We commissioned an academic team
to explore some of the underlying reasons behind the
issues with diversity that exist in some parts of the legal
services market, ensuring these problems remain at the
top of the regulatory agenda. The Legal Services Board
is a small organisation and we must target the resources
we have at priority areas and through working with
others (for example frontline regulators, representative
arms, etc.). We do this with a view to enhancing the use
of evidence in regulatory policy making. Our new online
resource is designed to support these aims.
The new research internet pages (http://research.
legalservicesboard.org.uk/) on our website present not
only the range of research reports we have undertaken
but also makes available all of the raw survey data
sets to enable others to undertake further analysis. It
includes an online library of surveys, research articles
and other reports, and our analysis of what this
information shows.
Perhaps ambitiously, we would like these web pages
to also generate greater transparency of information on
the legal services market, with a view to contributing to
a greater understanding of how the legal sector works
and what we and the approved regulators are doing to
reform it, in line with the aims of the Legal Services Act
2007. Hopefully we can all agree that regulation and the
understanding of its impacts on the market will benefit
from better evidence.
Chris Kenny, Chief Executive, Legal Services Board

Q: Do legal firms know
where they are going?
One day Alice came to a
A: fork in the road and saw a
Cheshire cat in a tree” which road
do I take?” she asked “Where do
you want to go” was his response.”I
don’t know,” Alice answered.
“Then”said the cat,”it doesn’t
matter.” (From Alices’ Adventures
in Wonderland.)
The winds of change continue to blow through the
legal profession driven by liberalisation, technology,
economic recession and changing customer demand
and expectation. Faced with these headwinds how
many leaders of legal firms are seriously considering
where they want to take their legal firm, which road
they should take and what the destination looks like?
Most people who have undertaken a degree of
education in business management, including most
Business Bank Mangers, will be familiar with Michael
Porters’ ‘five forces’ model and its relevance when looking
to establish a robust and relevant business strategy.
In recent months I have read a number of articles
suggesting that Porters five forces is potentially the
best hypothesis for supporting legal firms establish
a strategic plan given that it focuses on many of the
known challenges. This belief was further supported
when Neil Kinsella of Russell Jones & Walker addressed
the LMS Conference earlier this year and told delegates
how Porters five forces had helped the firm establish
its strategic direction in readiness for ABS and the
subsequent sale to Slater & Gordon.
For me the attraction to Porters model is its ability
to engage the thoughts, beliefs and vision of almost
anybody in the firm. Porters’ five headings can be
used to engage people through brainstorming or mind
mapping sessions and represents a fantastic opportunity
for employees to feel included in setting the strategic
direction of the business. This type of feedback is
invaluable to management when they are setting the
future strategic agenda and inclusion goes a long way to
ensuring that your people are on the same journey.
So why do I think that Porters’ Five Forces are so
relevant to the legal sector – if you read the headings
I would suggest that it’s almost impossible not to
appreciate their relevance.
1. Threat of new competition
2. Threat of substitute services
3. Bargaining power of clients
4. Bargaining power of suppliers
5. Intensity of competitive rivalry
For any leaders of legal firms about to consult the
Cheshire cat – possibly a read of Porters’ five forces
may help you choose the right road?
Steven Arundale, Head of Professionals Sectors,
Commercial Banking
RBS & Natwest
Q: How important is the role
of technology in the new legal
services arena?
The saying ‘Your greatest
A: threat is also your greatest
opportunity’ has probably never
been truer. The Legal Services
Act is credited with opening up
the profession to give consumers
greater choice and transparency,
despite being lambasted by many
in the profession for it’s timing
during our worst ever post war recession.
Investment in technologies that standardise
processes enables practitioners to offer services cost
effectively to clients and better compete against new
entrants. Consumers inevitably demand value for
money which is supported by figures showing 37%
of consumers said fixed fees are most important in
choosing a legal services provider and 81% saying they
wanted to know the costs upfront.
A recent YouGov survey revealed that 85% of
respondents had invested in technology within the
last five years whilst 42% of participants in research
carried out by Redbrick Solutions this month said
that Partners now have the final say in buying new
technology, a clear indication of the importance being
placed by the law firm.
When asked which three factors were the biggest
influencers in choosing new technology our research
showed 76% said ease of use was key, whilst 64%
said the ability to customise technology to fit their
requirements was also important and 44% were
concerned with the ongoing cost.
It is not enough to simply buy in new technology,
firms need to ensure their provider is committed to
working with them to customise the system to their
requirements, to keep it up to date and provide high
level support. All too often we meet law firms who
have spent eye watering sums of money on practice
management systems but have been left with the
responsibility of setting it up themselves – which
doesn’t happen because the law firms do not have the
time, expertise or resource to do this properly. This
is why we provide all of our clients with their own
dedicated Business Consultant, whom they can call
upon at any time for customisation, training or support
at no extra cost.
The possibilities for good legal technology are
endless; it can deliver a focused approach to active
client relationship management, an increase in new
instructions and greater client satisfaction, help
business owners identify trends and manage the
business effectively. It is too early yet to say how
successful the likes of Co-Op, Stobarts and the AA will
be in the market but you can be certain they will have
the very best technology, and will make sure they are
getting the maximum benefit from it.
Jo Hodges, Redbrick Solutions
www.redbricksolutions.co.uk
The views 21
ML // January 2013

22
The views
Q: Are degrees and professional
qualifications up to speed with
the changing face of legal
business models and
the marketplace?
CILEx has long believed
A: that the inherent value of
its education and training is in
learners being able to apply their
knowledge and skills directly to
their everyday work. And while
workplace learning is not unique
to CILEx’s qualification, CILEx
can proudly point to its long and
consistent record of championing learning outside
of the traditional classroom through vocationally
orientated distance learning.
The reason why CILEx’s approach embraces the
zeitgeist has much to do with the fast-changing structure
of the legal services industry. As is widely acknowledged,
the legal services industry is becoming more specialised.
So in its response to the Legal Education and Training
Review (LETR) CILEx argued that its qualification is, in
this respect, entirely fit for purpose.
Indeed, with employers requiring specialist
knowledge but perhaps not at senior levels (for
example, staff who progress standard files or act as
the first point of contact for new and existing clients),
CILEx believes that its paralegal qualifications match
the requirements of legal business models such as
ABSs. But not all legal service business models want
to terminate training at paralegal level, which is why
employees can progress to full specialist lawyer status
through the acquisition of further CILEx qualifications.
The LETR research team found that there were some
significant skills gaps hampering the development of
the legal services industry, which affect traditional and
new forms of legal business alike. For example, the
LETR identified the teaching of commercial awareness
skills as being an unmet need. CILEx in its submission
to the LETR has said that it is developing a qualification
which will encompass these skills.
Of course, if CILEx (through its regulator, ILEX
Professional Standards) is successful in its various
rights applications, then it is possible that Chartered
Legal Executives will want to start legal businesses
themselves. So ensuring those in such businesses are
adequately trained to be commercially effective is but
one necessary response to changing business models in
the legal services industry marketplace.
Noel Inge, Managing Director, ILEX Tutorial College.
ML // January 2013
Q: Will the price war impact the
delivery and sustainability of
specialist legal advice (from firms
to sets and ABSs) – i.e. will it
reduce the quality and number
of specialists?
In short, I believe the answer to
A: this question is a simple ‘yes’.
Opening his speech introducing
LASPO, Kenneth Clark commented
that access to justice was
a cornerstone of a civilized
democracy.
However, LASPO and the
proposed civil justice reforms
represent one of the most regressive steps imaginable in
terms of access to justice for people of ordinary means.
The situation is somewhat of a paradox. Everyone
agrees that people should have access to proper legal
advice, delivered by suitably qualified professionals. The
difficulty is that no one wants to pay for such advice
and few are able to do so.
The proposed reforms with swingeing fixed
recoverable costs (or ‘frankly ridiculous costs’ as one
solicitor described them to me), and success fees to
be taken from clients’ damages are perhaps the worst
possible solution to the problem. Damages Based
Agreements may or may not be of use depending on
whether the Ministry of Justice can decide whether the
indemnity principle will apply to them or not.
The new arrangements will create a race to the
bottom as firms compete for business in a world where
clients require a Rolls Royce service but recoverable
costs are fixed at jalopy levels and the shortfall would
wipe out any damages recovered.
Inevitably the reduced fee income from bread and
butter personal injury work (some put the reductions
at up to 70%) will have a knock on effect. Firms will no
longer be able to afford the more experienced specialist
lawyers because there is unlikely to be enough specialist
work to keep them occupied full time and the income
from more routine work is insufficient to cover their
overheads.
What this means in practice is that the number and
quality of specialists will inevitably reduce and anyone
who requires such advice is likely to have to go to a
larger firm, quite possibly located some distance away
and charging large firm rates. Such firms are likely to be
the only ones able to offer quality specialist advice in
the post Jackson legal moonscape.
Rob Parness, Costs Lawyer, Paramount Legal Costs Ltd.

Q: Will commoditisation kill off
specialism in firms / chambers /
ABSs and what impact will this
have? Or will clients always need
specialist advice?
Working within a niche
A: family law practice I am
perhaps more aware than most
of the benefits a specialist in the
legal market can offer. The word
‘specialist’ suggests someone
who is fully qualified and who has
worked for many years gaining
invaluable experience within the
type of work they are asked to carry out.
One of the challenges with commoditisation of any
service is that volume of cases is important to achieve
the economies of scale and that needs a certain volume
of staff. Recruiting experienced staff is not easy which
is why larger providers of legal services often have no
other option than to fall back on using inexperienced
staff. This presents no problem if the advice to be given
is of a routine nature but service issues arise when
complex matters are being handled by staff without
the specialism necessary to progress the case correctly,
effectively and in a timely manner.
A major consideration for any client is cost – the
primary purpose of commoditisation is to enjoy
economies of scale to be able to offer a legal service
at a competitive cost – although conveyancing
practice has proved that this is not always the case.
This reduction will be welcomed by many consumers
and will undoubtedly enable many more people to
access legal advice. However for those with complex
circumstances, and who value the benefits that personal
experience brings, there remains the choice to use
a specialist legal practitioner. In many instances,
the specialist will earn their own fee by delivering
an enhanced, detailed or more effective settlement,
outcome or result whether this be financial, creative or
in respect of time with a more personal approach.
What is key for the consumer is that they have a full
understanding of the service provided by each provider
– making a decision of which service to use on the basis
of cost alone could prove to be an expensive mistake.
Commoditisation is both needed and is inevitable as it
meets a market demand however it is not the answer
for all clients.
The impact of commoditisation will impact on the
current legal market in a variety of ways dependent
upon the type of work being undertaken. There will
always be a need for the true specialists, experienced in
their respective field of legal advice. There will always
be a need for the general level of advice offered in
volume at a cost effective rate. What will sadly be at
risk going forward in the current market is the middle
tier of neither specialist advice nor volume provider.
Angela Moore, Jarvis Family Law
The views
Q: What will be the main impact
of the RTA portal cost reduction?
On the 19 November 2012,
A: Helen Grant MP wrote to
all interested stakeholders with
proposals on fixed recoverable
costs. The proposals are contained
in Annexes A and B to her letter.
If you have not looked at the
Annexes, what on earth have you
been doing that is more important?
The bad news is the figures are very low and they
would apply to RTA, EL and PL work between £1,000
and £25,000, whether it settles in the Portal or at Court.
The good news is the letter asked for a response and
supporting documents by the 4 January 2013 (around
the time of this publication). So hopefully you have
already told the MoJ what you think.
Clearly the actual figures have not yet come back
and it is likely that the new figures will be out by or in
February. But for arguments sake, let us assume that the
final figures are not a long way away from the current
figures, what will be the impact?
My view is that the lower the figures are the more
likely that the majority of law firms will be looking to the
client to make a contribution to their legal fees.
Will everyone do this? In my view, the vast majority of
claimant law firms will have no choice but to charge the
client. So for the majority of law firms it will mean an
end to no win no fee and an end to the client getting all
of his damages.
Also as the fees are so low, the idea that Lord Justice
Jackson puts forward that law firms will compete within
the 25% band, just does not stack up to me. I can see
firms charging the full 25%, or even a fixed fee and
maybe the insurer backed firms or the goliaths being
able to charge 0% and there being very little in between.
It is easy to see high street practices which do a
bit of personal injury work, struggling and the big
firms getting even bigger. What about the firms in
the middle? Well there has never been a better time
to be efficient, never a better time to go out strong
on service. As we are going to have to do everything
cheaper and better than we currently do, otherwise we
really are in trouble.
David Bott, Immediate Past President of APIL and
Managing Director of Bott & Co.
23
ML // January 2013

00 24
???? The views
If it looks like a duck...
If it looks like a duck, sounds like
a duck and walks like a duck,
then it probably is a duck. That
useful formula can now probably
be applied to the very new kids
on the legal services market -
Alternative Business Structures.
One year on and was all
the hype worth it? Have they
changed the legal landscape? Well absolutely not yet
but that was not to be expected. Rome wasn’t built in
a day, etc. etc.
There are really just a handful of bodies already
licensed and a disproportionate number of those by the
CLC (Council for Licensed Conveyancers). Most so far
are pretty much as expected. There are a smattering
of big brands (Co-op etc) and then a mix of litigation
based and conveyancing based bodies - plus a couple
of wills/ probate bodies. Nothing earth shattering but
then we are not yet a year into full licensing and a
completely new market is bound to take time to emerge
let alone mature.
What is interesting is more the number of
applications which are pending at the SRA and CLC and
what proportion of those will make it into full blown
ABSs over the next year.
The SRA and CLC are still learning themselves - and
the more bodies they licence the more experienced
they will become so we should expect an acceleration
of successful applications - to the point that it is no
longer news-worthy and its getting that way now
2012 was never going to be a defining year in
changing the number of legal providers following the
Act. 2013 will be much busier and by the time we get
to 2015, we are going to see a dramatic difference in
bodies providing legal services.
Until then watch out for all sorts of new breeds of
ducks populating a pond nearby you!
Eddie Goldsmith, Partner at Goldsmith Williams and
Chair of the Conveyancing Association.
ML // January 2013
Q: Will commoditisation kill
specialism in law firms/chambers/
ABSs and what impact will this
have? Will clients always need
specialist advice?
Over the past few years
A: an American management
theory called The Drift to the
Left, which basically holds that
it is the natural evolution of all
professional services to move
from a one-to-one, individually
customised, relatively expensive
adviser/client relationship, to
an impersonal, high volume/low price commoditised
model, has gained growing acceptance in the UK legal
community. Thanks to being championed by its main
advocate in the UK – Richard Susskind – in some legal
circles it has become the new orthodoxy.
So will commoditisation kill specialism? The answer
is a resounding ‘no’ – in fact even Richard Susskind
doesn’t believe it will. The argument is far more
subtle: what it actually suggests is that much of the
work lawyers (and other professional advisers) do on
behalf of their clients is of such a routine nature that it
doesn’t – and shouldn’t – need to be conducted on the
traditional one-to-one basis. This work can definitely
be commoditised and it follows that any lawyers who
continue to offer the ‘traditional’ approach will find
themselves in an increasingly uncompetitive position.
To use the analogy of our old friends Tesco, the
traditional corner shop cannot hope to compete with
a supermarket in terms of pricing and product range.
But this is only part of the story. There remain plenty
of areas of legal practice that do not lend themselves
to a commoditised approach, both at the top end
commercial level and in niche areas of practice, which
is why along with everything else in the legal services
market, we are seeing the rise of the boutique firm.
A long time ago, a now long departed president of
the English Law Society told members at an annual
conference that the days of the generalist High Street
practice were over and that they should ‘either get a
speciality or get out’. His advice wasn’t popular but he
was right. There is an alternative to commoditisation
and you can see the same principles at work on the
High Street – among specialist shops, boutiques and
delicatessen. The successful ones know their markets,
their niches and their customers – and they also
know they can offer something the commoditised
supermarkets can’t compete with.
And please note I am not using the word
commoditised as being synonymous with computerized
/ automated. Just because you are practising in a niche
area of law doesn’t mean you can’t still benefit for IT
and office automation!
Charles Christian is a barrister who has written about
legal technology for over 30 years.

Organisational culture: a
powerful force that can
undermine or propel
business success?
The traditional approaches
to strategy often adopted
by firms do not recognise the
importance and power of business
culture as an integrating and
unifying ‘driver’ of action. In other
words, they do not recognise
the potential for culture to be a
powerful force that can undermine
or propel their business. In many firms there is no
written strategy and so by default ‘the way things
are done around here’ actually becomes the firm’s
operational strategy.
As such, many firms might not truly understand
why they succeeded or fail, or understand the unique
contribution culture plays in either event. Organisational
and national culture is a ‘deep’ phenomenon, complex
and difficult to understand. The dynamics of why and
how organisations grow, change, sometimes fail, and
perhaps most important of all – do things that don’t
seem to make sense, continues to elude us.
Organisations will often measure their performance
by hard accounting methodologies without
understanding the effects that softer, less visible cultural
influences can have on their business; but the effort
to understand it is worthwhile because much of the
mysterious and the irrational in organisations suddenly
become clear when we do understand it.
Just because we cannot define or measure business
culture easily does not mean it does not exist. We
humans are cultural beings and we do not normally live
in isolation. Most humans have a sense of intuition that
feeds perception. Perception often becomes reality.
Culture therefore is a phenomenon that surrounds us
all, but strangely, people often say that they do not use
the concept of culture in their work, but when asked;
what is it they do not use, they cannot define ‘it’ clearly.
Culture helps us understand how an organisation is
created and constructed, it defines leadership; therefore
it is vital to understand how culture is embedded,
developed, manipulated, managed, and changed.
To truly have a successful firm, first you need to
understand the culture of your firm and to recognise
that your firm’s culture is a powerful force that can
undermine or propel business success.
Mark Witter, Chief Operations Officer of Anglia Research
Services.
The views
Q: How important is
the role of IT in the new
legal services arena?
Our company works in many
A: sectors and it is quite telling
how different the approach is to
IT within the many sectors that
we work in. The approach goes
from being utterly reliable on IT to
seeing IT as a ‘necessary evil’. It is
also obvious that those companies
that embrace IT have more control
when it comes to making sense of how the business is
doing financially. The legal sector sometimes takes a
long time to make IT decisions. Is this because equity
partners are not given the information they need about
how much better their firm will operate if it has the right
systems in place? Or is it because they don’t like parting
with their hard earned cash? Both scenarios need to
be dealt with and key questions that need to be asked
should be faced head-on. One such key question is
‘what impact will a reduction of 20% in lock-up have on
the firm’s cash flow?’
ERP (Enterprise Resource Planning) systems are
designed to work in many different sectors. There are
solutions that enable the business processes behind
the manufacture of what we eat to those that provide
the distribution of goods throughout the world. What
is common in all these systems is that they have grown
from a need to automate processes and to make the
management of these processes simpler. In some
sectors, e.g. pharmaceuticals, the regulations under
which manufacturing must work are vast and time
consuming, but absolutely critical to ensuring safe
products are delivered to all of us. Pharmaceutical
companies rely heavily upon their IT systems and are
very profitable businesses. What can the legal sector
learn from what other sectors already know?
To put this into context and again, using the lockup
scenario, what benefits would law firms get from
providing key information to those that can make the
right decisions in a near real-time way? If the current
business process does not support this way of working,
a change needs to be considered and QlikView will be
able to make this possible.
Barry Talbot, Managing Director, Informance.
25
ML // January 2013

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Q: What resources will be key for
growth for your clients over the
next 12 months?
A
: There is currently so much
focus on compliance across
the legal sector and I could
respond to this by saying IT
and technology to keep up with
expanding law firms and ABSs.
The truth is though that without
firms addressing their compliance
needs and ensuring they are
complying – the risk is so high that investment in other
areas is secondary.
Yes growth is important and winning new work and
retaining existing clients, but there is so much to do
around compliance and it is vital in the self-regulation
environment that we are now in that compliance is
key. The focus on resource and investment needs to
therefore be on compliance.
The first tranche of firms have already received
approval by the SRA with the rest to follow. The new
Code of Conduct is live and the compliance officers
take up their roles from 1 January 2013 – there is so
much to be done!
Firms that have already achieved Lexcel - and/or are
confident that their practice management standards
are efficient and compliant - should be focusing on Risk
Management and especially the Risk Register.
Firms that have not yet started with their compliance
plan should start with a health check of their firm. This
can be done internally or outsourced but it is vital for
them to know what is working well and what needs to
be done. Otherwise there is no structured plan.
Where to start? I would suggest they ensure
their Client Care letters and Terms of Business are
compliant. Then move onto reviewing their policies and
procedures. Alongside this and no less important are
file reviews. File reviews are key in risk management
and supervision. Not only to identify out of date
information and updates which are required but once all
the hard work has been done, firms will not know that
the new policies and procedures are being followed if
file reviews are not completed.
Once all of that is up to date and managed - other
resources I would focus on would be IT and technology.
Jaunita Gobby, Director, Legal Eye Ltd.
The views
What’s the worst that
could happen?
As COLP, managing ‘business
continuity risk’ is a key
responsibility. In any case,
knowing you have prepared for
the worst helps you to sleep easily.
Here is how to get on top of this
issue in three easy steps:
1. understand what “Business Continuity” (BC) means.
It is the ability of your firm to continue its operations
despite major disruption (for example due to IT failure,
fire or burglary).
2. Identify Your Risks
Ask yourself how you would cope if:
• Your offices burned down, or were flooded, or
otherwise out of action.
• You could not use your IT systems, perhaps due to
computers being stolen, or a virus.
• Your paper files were lost or inaccessible, perhaps due
to fire or malicious action.
• A key person was unavailable, due to accident or
serious illness.
3. Draft Your Plan
Having identified the worst risks, it should be obvious
what you need to do. Action may either reduce the
likelihood of risks occurring, or mitigate the effect. For
example a sprinkler system would reduce the risk of fire
but you might also make arrangements so people can
work from home if your offices burn down.
For most firms the key things will be:
• Data backed up off-site on a regular basis. (Cloud
technology makes it easy and cheap to back up data.)
• IT systems and data available from off-site.
• Important original documents (such as leases and
wills) scanned and saved electronically, in case the
originals are lost.
• Insurance.
The risks are much greater for firms which rely heavily
on paper files. You may decide this is a reason to move
towards virtual document management.
Smaller firms are particularly vulnerable to the
loss of key people. There is no easy solution beyond
training up others.
This article draws on the Socrates precedent business
continuity risk assessment questionnaire and precedent
plan, which are part of its service for COLPs and COFAs.
Bernard George, Director of Socrates Training. bernard@
socrates-training.co.uk
1 To be precise, partners in general and the COLP in particular have
responsibility for “identifying and monitoring financial, operational and
business continuity risks including complaints, credit risks and exposure,
claims under legislation relating to matters such as data protection,
IT failures and abuses, and damage to offices”. See the SRA Code of
Conduct, IB 7.3.
27
ML // January 2013

Q: How Can You Be Sure You
Are Acting In Your Client’s
Best Interests?
With the focus firmly on
A: risk and compliance at the
moment, newly appointed COLPs
and COFAs will undoubtedly be
feeling a little anxious about their
upcoming roles as we enter 2013.
Even firms with the most robust
systems in place for best practice
will wonder whether they have
done enough in the eyes of their regulators, should they
receive a visit from them.
Whilst there is no doubt that almost everyone within
the legal profession has entered because they want to
do the very best for their clients at all times, we now
know that working to the best of your ability is no
longer, in itself, good enough. You need to ensure you
have an audit trail, to support the reasons behind all the
decisions you take, hence the need for firms to have a
full complement of policies and procedures in place.
Given this, how then would you demonstrate that you
were ‘acting in your client’s best interests’ when choosing
a legal service provider? Would you feel that price alone
would be enough to justify who you have elected? What
about turnaround times? Have you considered the
service provider’s own risk and compliance systems and
procedures? Have they been accredited or undergone
any assessments and if so, who by and how recently?
Can you see if they hold appropriate insurance? What
is their customer feedback like, and it is available for
you to view? Are they members of any regulatory or
supervisory bodies? All these things really do need to
be considered when choosing any legal service provider,
including a search provider.
I am confident that Searches UK, which has been
assessed as working in line with the Lexcel standard,
is a member of CoPSO and subscribe to the Search
Code, would easily tick all of the above boxes if you
were to assess us as your chosen search provider. My
point is, whoever you use to provide you with your
conveyancing searches, the obligation rests with you to
show that you have considered why you have chosen
that provider and you will be required to look at this
regularly to ensure that there have been no changes.
You have a responsibility to act in your client’s best
interests, so simply staying with the same provider you
have used for the last 10 years is not necessarily going
to stack up.
If you would like further information or wish to speak
to our Risk & Compliance Manager, please do feel free
to get in touch.
Andrew Stenning, Managing Director,
Searches UK Limited.
The views
Q: Are undergraduate and
postgraduate courses and
professional qualifications up to
speed with the changing face of
legal business models and the
market place?
29
As a (relatively) recent
A: graduate of the legal
education system (having
completed a law degree, the
Legal Practice Course and
qualified into the working world
as a solicitor) I would have to
say the legal education system
in the form of undergraduate
courses and professional qualifications leaves room for
improvement.
Whether we like it or not, the face of the legal
marketplace is changing at a rapid rate - the most
obvious change being the implementation of ABSs,
introducing new influential players into the legal
market, including more corporate bodies such as The
Co-operative and Tesco. Coupled with the difficult
economic climate, the role of a lawyer in today’s market
is increasingly a multi-faceted one with a combination
of different demands.
It is certainly not sufficient to be a ‘good lawyer’ with
a comprehensive legal knowledge and good client care.
Lawyers from a very early stage in their career, including
newly qualified solicitors, must also be business
developers, marketers, effective networkers and
proficient managers. Young lawyers must not only know
the law, but also show creativity, flair and dynamism
in bringing new work to the firm, add brand value and
drive the firm forward.
Speaking from experience, there is no doubt that
the combination of the degree and professional
qualification is effective in providing students with a
comprehensive grounding of the law and in establishing
a thorough academic foundation.
However, I’m not sure it fully prepares students for
the commercial reality of being a lawyer in today’s everchanging
and highly competitive legal market.
I acknowledge that students are already thrown
many challenges in their academic path to qualification,
without having to deal with additional commercial or
marketing elements. Despite this, those training lawyers
need to find some way of more readily helping students
deal with the commercial reality of today’s demanding
legal market.
Eimear McCartan, Corporate & Partnership Solicitor, Ralli
ML // January 2013

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Q: How important is the role of IT
in the new legal services arena?
Think through this common
A: scenario - then apply the
same principles in other areas
of your practice to evaluate the
potential of IT to make you more
competitive and improve your
performance.
A client calls in to make a
will. They appoint two executors
who will be their most trusted friends or relations (and
perhaps also someone from your practice).
Do you know if anyone at your practice knows these
two executors? Would you ask the testator if it would
be helpful to send them some information about the
responsibilities they are taking on? Do you have that
available? If you don’t already know them, should you
ask the client if it’s ok to add them to your system, to
be able send out that information and invite them to
opt into further contact in future? Can you invite them
in for a chat to establish contact if they want to drop
in (and send a timely reminder), to build up a better
relationship with them so you understand their family’s
legal needs? What about their children and parents –
can we do something for them? Will you stay in touch
to offer that client and members of their family other
services relevant to them, now we understand what
they might need in the future?
To manage this requires simple but effective use of
a user-friendly client relationship management (CRM)
system to manage data and prompt activity. Yet this is
just one area of how you operate that can be improved
by effective use of IT.
This is not just about technology but also about the
mindset and vision of the people who develop and
use IT systems. Integrated, user-friendly and powerful
solutions are readily available but require investment
of intellect and time as well as money to produce
more competitive business results. This isn’t just on
relationships but to deliver more for less and managing
client relationships is critical. If you do not have a
structured approach supported by technology you can
rest assured that others will. Those executors could well
be your clients today but gone tomorrow.
Allan Carton, Director, InPractice UK Limited
Barristers come
to the fore
The views
for a while now there have been
many new initiatives bandied
around the Bar from ProcureCos
to ABSs (Alternative Business
Structures) and LDPs (Legal
Disciplinary Practices). For many
though, ProcureCos have proven
to be a complete red herring and
very few chambers that have
gone down that route can show significant commercial
or financial gains. From the numerous discussions we
have had with chambers up and down the country it has
become clear that, for many, there are two significant
areas that will be defining the future spectrum of the
Bar: international client instructions and direct access.
These will continue to be key areas of focus for 2013.
International client instructions continue to increase
at the Bar, with some commercially funded sets seeing
an increase of 20% plus from international clients in
the last 18 months. The more progressive sets are
actively targeting this work. In turn, criminal sets are
courting and being courted by corporate businesses, as
they want to buy into the criminal advocacy skill set –
again the more commercially minded criminal sets are
positioning themselves accordingly to market this rare
commodity.
Direct access offers an ideal, potential win-win
situation. Businesses and the general public have the
opportunity to get the best legal advice they can
afford, without having to pay ‘twice’ by first instructing
solicitors. Barristers get paid up-front. The Bar Council
has also facilitated the scope for direct access, with
the introduction of BarCo, which allows chambers to
hold onto client money. At the end of last year there
was a new web-based initiative launched to drive direct
access work to the Bar; the first of its kind with the
potential to be a game-changer for the Bar.
For too long chambers have had to play second
fiddle to law firms and direct access offers the
opportunity for the Bar to balance out the playing field.
With cuts to legal aid funding and the disappearance
of many high street law firms, the public are likely to
find this route to the Bar very favourable, and extremely
cost effective. 2013 will prove to be a year where this
message will be marketed to the public and businesses
like never before.
Guy Hewetson, Partner, Hewetson Shah LLP
31
ML // January 2013

32
The views
Q: After discussing funding/insurance
options on a new commercial claim,
the client wishes to apply for after the
event legal expenses insurance (ATE).
How should I prepare the application?
What cover should the client seek?
You and your client will need
A: to complete and submit a
proposal form (usually obtained
via a specialist ATE broker). The
precise detail required may vary,
but insurers will be looking to
obtain key information to enable
them to form an initial view
quickly. It is the quality rather than
the quantity of information provided that is important.
In addition to basic (but important) information on
the parties involved, the following will be essential for
the review process.
Brief Case Summary with key documents
• What type of claim is it?
• What are the applicant’s objectives?
• What are the prospects of success on liability,
causation, and quantum?
• How has the opponent responded?
• Key documents will include statements of case and/or
significant pre action correspondence, and a copy of
Counsel’s/ solicitor’s opinion.
financials – Does it stack up?
• Estimates and budgets – A budget showing estimated
applicant’s costs to trial, and a reasoned estimate of what
the opponent’s equivalent costs will be are required and
are central to the appropriate level of cover.
• How will the case be funded? – What will be involved?
Standard retainer, full or discounted conditional fee
agreements, third party funding, or from April 2013
damages based agreements?
• Quantum – How is any financial claim calculated and
what evidence supports this?
• Will the opponent be able to pay? – What is the evidence?
• Can the case be settled? - Financially and otherwise.
what cover or ‘Limit of Indemnity’ should the client seek?
Insurers are conscious of risk alignment. Be realistic and
keep the following in mind:
• Adverse Costs: Cover for potential exposure for
opponent’s costs is the most usual ATE cover. Typically
this is based on the estimate for opponent’s costs to
trial. Neither over nor under insurance is desirable.
• Own Disbursements (ODs): OD cover is often
available to cover exposure where ODs are not
reimbursed by sums received. However OD cover
represents a different nature of risk and may not
always be offered or offered in full.
• Own Costs: Cover for own costs is much less
common. If offered it is likely to apply only to a limited
percentage and in particular circumstances.
Matthew Williams, Head of AmTrust Law at AmTrust
Financial Services.
ML // January 2013
Q: How effective are associations
voicing the issues facing the
industry? In terms of multidisciplinary
ABSs, are they
relevant?
Before I answer this
A: question I will use the word
consumer when I mean client and
industry when I mean profession.
Not because I wish to dumb
things down but because that is
becoming the norm and for the
sake of clarity and consistency.
There are, I think, two ways
that this question could be interpreted. It could have
been directed at organisations such as APIL, MASS and
FOIL, etc. but it can be also be answered in terms of the
changing support available to law firms in this new age.
With more and more ABSs being created every month
making sure that lawyers are aware of the issues facing
the industry is becoming more and more important.
I spend most of my time monitoring the legal news
that all lawyers are expected to follow. It is a full time
job. Keeping up to date with what is happening in the
legal profession is now a very time-consuming exercise.
Can most firms afford to employ one person to ensure
that they do not miss something important, either
in relation to compliance and regulatory matters or
making sure they have access to the best products and
services available?
Before 8.00 am every morning I will have checked
over ten different websites, starting with the SRA
(in November alone there were six new posts on the
‘news and alerts’ section) and the Practice Notes
Section of the Law Society website. Every day I
receive numerous emails from companies that think
they have created the latest and best solution to a
problem, ranging from fraud detection and prevention
to ways to win new work.
Two other burgeoning sectors is legal brands and
cost comparison websites. Trying to establish whether
any of these offer any real help or support is nigh on
impossible. What we do as a group, is discuss these
new businesses and exchange views on how good, or
otherwise, they actually are.
To sum up; keeping abreast of issues facing the
industry when more and more new competitors enter
the arena is more important than ever before. As to
how affective the associations are that voice the issues
facing the industry? I can only comment on one. This
year we have had a 97% renewal rate for Bold Legal
Group members and most of the missing 3% will have
merged with other firms.
Rob Hailstone, Bold Legal Group

The ABS Landscape One
Year On
Last October, when the first
ABS applications were being
submitted and assessed, most
of us were unsure of the way in
which they would impact, if at all,
on the current legal landscape.
Many were sceptical, believing
they were not really all that new,
given that back in the 90s, banks
had been running firms in much
the same way, and that it was
more hype than anything else. Some saw ABSs as a
huge opportunity – one which they definitely wanted
to embrace, whilst others chose to sit comfortably on
the fence and ‘watch this space’. Well, we’ve ‘watched
this space’ for over a year now, so how have ABSs
impacted?
Well, on the face of it, it may appear that they didn’t
really create that much of a storm, but that’s hardly a
surprise, given the timescales of around nine months
involved for processing applications. That said, there are
over 60 approved ABSs licensed by the SRA and CLC
alone, with over 225 applications pending. This represents
just over 2.5% of all firms regulated by the SRA and CLC
which have submitted an application already.
The numbers alone do not give us the full picture and
we also need to consider the type of licenses that have
been granted, as some of them have been significant,
as well as the areas of law that have been the focus
of attention for firms wanting to be approved as an
ABS. Most of us expected the likes of Co-operative
Legal Services to apply, and it is anticipated that its
status as an ABS will see in the region of 3,000 jobs
being created. Others, such as Thompsons Solicitors
LLP and Paribas Law, will be operating from over 20
offices across the country. Whilst the largest number
of approved ABSs initially targeted the personal injury
market, many are now entering the conveyancing and
wills and probate arena too.
There is no doubt that ABSs have certainly shaken
things up, and I personally believe this is for the better.
Times are changing. Whether you wish to go full steam
ahead and jump on the ABS bandwagon or not, it is a
given that all law firms need to adopt a more businesslike
approach to running their affairs if they wish to
survive and prosper.
Faye Stenning, Inside Conveyancing.
The views
Q: Is it the role of lawyers to
communicate the changes
affecting the justice system and
the value of lawyers and can they
effectively market the message of
value to consumers?
Undoubtedly yes, it is
A: the role of legal services
providers (not necessarily
individual lawyers) to
communicate changes in the
justice system to their clients
and the wider public and to
communicate their own value.
Any organisation that takes
the lead in an evolving market and can communicate
clear and concise value statements will have a
competitive advantage over its rivals. It is perceived as
a ‘thought leader’ and ‘trusted source of information’.
That perception builds reputation which in turn leads
to increased instructions. The same applies in the legal
market. However, it is not a simple task.
By taking the lead, chambers can communicate
changes before anyone else. They can explain the changes
in relation to the clients and furthermore they can illustrate
their own ‘value’ by doing so. They need to communicate
changes in a manner that the clients can fully understand.
• How does the change impact on the client
(or lay client)?
• What do they need to be aware of?
• How do they need to act differently to remain
compliant with the law?
• What benefit is there to the client in buying the legal
service from us?
The value of chambers is not simply in dealing with
the aftermath of events, but instead in understanding
the client’s needs and pre-empting any potentially
damaging situations. If the chambers’ segments the
market correctly the process of building relationships
and communicating value becomes easier.
For sets dealing with the general public it’s much
more difficult.
There is still a need to communicate changes in a
manner that the clients can fully understand. However,
communicating with the public requires the ability to
talk in plain English and it requires a large financial
investment. It also requires a multi-channel approach
(advertising, TV, radio, direct mail, face-to-face, social
etc.). This is where organisations like QS have the edge
over individual law firms / chambers.
However, the smaller firm / set can use social media,
comparison sites and joint marketing with other
companies to create differentiation and communicate
their value. They just need to be a little more creative in
communicating their value propositions!
Catherine Bailey, Managing Director, Bar Marketing.
www.barmarketing.co.uk
33
ML // January 2013

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Back to the Future:
Part 51
“The future belongs to those who prepare for it
today,” Malcolm X.
Much has been written about
the forthcoming CPR reforms
as proposed by Sir Rupert
Jackson. Rightly or wrongly the
focus seems to have been on the
imminent demise of the CFA and
how its replacement, the DBA, will
operate in practice.
However Jackson’s cost
budgeting proposals, whilst less talked about are
going to have a major impact on litigators working on
multi-track cases. Essentially the requirement will be to
accurately predict your costs, including disbursements
two weeks before the first CMC. In the event that you
exceed your budget and do not have approval to do
so, your client(s) may not be able to recover additional
costs regardless of the outcome of the case – see Henry
v NGN.
Short of employing Mystic Meg to manage your cost
budgeting what is the solution? It is not to rush out and
employ the most expensive consultant you can find, nor
is it to bury your head in the sand assuming that mutual
incompetence will be some form of cover at the CMC.
There are, however, a number of simple steps you can
take that will help to create your own crystal ball:
• Preparation: If you don’t already do so start recording
your time by detailed activity e.g. rather than ‘0.6
units drafting’ record ‘0.6 units drafting witness
statement’. Thus when required, you will know long on
average a witness statement takes.
• Identification: Get as much information as possible
as early as possible from your client; send a
questionnaire asking them to outline how and where
potentially relevant data might be stored. Obtain an
estimate as to the likely costs of recovering the data
for review and disclosure.
• Preservation: Advise your client of the need to
preserve all potentially relevant data, this can be done
cheaply and quickly. By purchasing an additional
back up tape (£40-£50) and using it to replace a tape
from the back up sequence. The tape can then be
stored by your client until such a time as it is required.
Is your firm ready for cost budgeting? If not better to
prepare for the future than wonder what it holds.
Steven England, Litigation Support Consultant, K2 Legal
Support and Millnet. www.k2legalsupport.co.uk www.
millnet.co.uk
Flexible IT
infrastructures: enabling
secure data access
for ABSs
In Order for ABSs to work
effectively across a multi-tiered
range of services, clients and
sectors, their employees need
instant access to data, no matter
where they are working from
or what device they are using.
External service providers are
being contracted to implement
flexible and efficient IT infrastructures which can adapt
to changing business requirements and provide ABSs
with secure access to their critical data. ABS, Irwin
Mitchell, has recently awarded a contract to managed
services provider Esteem Systems, to provide a £1.7m
solution to transform its IT infrastructure.
In light of the ABSs’ substantial organic growth and
recent acquisition of PDP Management, the significant
investment will support Irwin Mitchell’s domestic and
global growth plans; improve services to clients; and
improve employee productivity.
Tim Kiel, IT Director at Irwin Mitchell, explains: “This
investment will impact our business in three key ways.
It will significantly improve the IT experience of our
employees; enable us to deliver an even better service
to our clients; and will support our global growth plans.
From an IT operational perspective, working with one
strategic partner for our IT infrastructure and support
will simplify the supplier management process, and
deliver substantial cost savings.”
Alongside Irwin Mitchell’s in-house IT function, the
newly designed and implemented modular desktop
infrastructure will be scaled as the firm grows. The
solution is set to improve the experience of employees
with instant access to applications and data, regardless
of location – key for a growing ABS with global growth
strategies. Like most large scale legal service providers,
secure remote access to critical applications and data
for senior partners and associates working from client
sites was a key business requirement.
Alastair Kitching, Group Sales & Marketing Director
for Esteem stresses the need for ABSs and law firms
to prioritise investment into secure and remote data
access as ‘providing employees with rapid access to
the applications and data they need from anywhere,
on any device is essential for them all in order to
drive productivity and business growth’. The new
infrastructure will allow Irwin Mitchell to support future
mergers and acquisitions and drive productivity and
business growth.
Alistair Kitching - Esteem Systems Ltd
The Views
35
ML // January 2013

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Sector roundtaBle:
PerSonal inJurY
MLM: how will the referral fee ban (which comes into
effect on 1 April 2013) affect all sides of the PI sector?
Twambley: The ban is aimed at a certain type of claims
management company (CMC) but it will hit those running
a legitimate operation. The main target (the less salubrious
end of the market) has been changed and the ban
incorporates everyone.
Bott: We would all really appreciate more information
from the SRA. It is at pains to say whether firms are doing
something wrong or not in light of LASPO and the 10
principles of outcomes focused regulation (OFR). The vast
majority of solicitors are abiding by the rules and plan to
after April but we need to know the details. For example,
are legal marketing collectives in or out?
Starling: We should take it as read that professionals will
obey the rules but this reform should be taken as part of a
whole package, not just a stand-alone ban.
hughes: This ban has to be seen as part of the bigger
picture, although it wasn’t Jackson who brought this in, it
was Jack Straw - yet even he was vague on the principles.
The biggest recipient of referral fees have always been
insurers and one of the main impacts the ban will have on
the system is cash flow.
Bott: There are four very separate conversations being had
at the moment: 1) on ABSs, 2) Jackson reforms, 3) LASPO /
Referral fees, 4) Fixed costs and the portal extension. These
have all been lumped together somewhat, with ABSs being
offered as a possible vehicle to deal with reform. But the
deadline is looming and no information has come to light –
so how can firms plan for Doomsday and how is the injured
person caught up in all of this?
Rousell: There is a political imperative to reduce costs and
the Government is working very closely with the regulators
behind the scenes. However it’s important all regulators
say the same things and the MoJ and SRA should be in
discussion to clarify what’s in and what’s out of the ban.
Bott: Part of the problem with the reforms – unlike the
Woolf Reforms – is that there has been a significant
programme of redundancies in the MoJ so it may be trying
its best but it’s under-resourced.
nesbit: Another issue is funding the Claims Management
Regulation department in the MoJ, as if there are no CMCs...
Rousell: We are working out how many firms are left to pay
for the regulator but yes, it will drop.
nesbit: Lawyers looking to overcome are or are considering
bringing in non-legal partners – but there is reluctance by
the CMCs to get involved in new models.
hughes: Ultimately those who set up CMCs are
entrepreneurs. They’ll simply find something else to do.
Clarke: Also, I don’t agree with the idea that insurers are
just jumping on the ABS bandwagon to overcome the ban.
There are a number of reasons why insurers would want
Features 37
Modern Law hosted a lively roundtable of practitioners, representatives and
experts in the PI field to discuss the impact and redress perceptions of significant
reform due to radicalise the sector this April.
RounDTABLE GuESTS
Chair: Alan nesbit CEO, Nesbit Law Group LLP, Founder
of ARC (Association of Regulated CMCs)
Andrew Twambley Partner, Amelans & InjuryLawyers4U
Anthony hughes Chief Executive, Horwich Farrelly
Dr Bippon vinayak Chairman & CEO, Doctors Chambers
Charles Layfield Partner, Pannone LLP
David Bott Managing Partner, Bott & Co, Immediate Past
President of APIL (Association of Personal Injury Lawyers)
Don Clarke Partner & Director of Strategy, Keoghs,
President of FOIL (Federation of Insurance Lawyers)
Donna Scully Partner, Carpenters Solicitors, Immediate
Past President, MASS (Motor Accident Solicitors Society)
hilary Meredith Senior Partner, Hilary Meredith Solicitors
Kevin Rousell Head of Claims Management Regulation,
Ministry of Justice
nick Starling Director of General Insurance, ABI
(Association of British Insurers)
Tim wallis Mediator & Independent Chairman of RTA Portal
Co Ltd and the ABI GTA Technical Committee (Credit Hire).
A founder member of the Civil Justice Council (CJC).
to sell legal services – and the Co-op is a true ABS in that
sense. I support the referral fee ban as fees are of no value
to the individual, but only if it’s done correctly rather than a
knee-jerk reaction.
Starling: Although there’s currently no rush by ABI
members to become an ABS...
vinayak: The concerns about the ban however isn’t from
CMCs – they will find opportunities where they can – but
from the firms that rely on the claims feed.
Bott: If you surveyed the legal market and asked how many
would like to get into bed with a CMC, ‘not many’ would be
the response...Law firms have far higher risks to the integrity
of the brand and lawyers would be mortified at any bad
ML // January 2013

38 00 Features
????
press over merging. CMCs may not be
so bothered on the whole.
Scully: Although some lawyers are
blackening the solicitor brand already
but the SRA is too busy to close rogues
and ‘live for today’ practitioners down.
hughes: Entrepreneurs brush risk off,
they put business first.
MLM: will the PI small claims limit hike
happen and what impact will it have?
Scully: David Cameron looked at a
way to lower insurance premiums
and the cost of small claims – this is a
direct result of that agenda. Political
imperative is at its highest level on the
matter so although the MoJ would like
to wait, it will be dealt with in April.
Rousell: The matter of whether the
small claims limit should include
only whiplash or all of PI has been
consulted on and is a genuine
consultation.
Scully: Although only the insurance
industry met with Cameron to start with.
Starling: Previous discussions revolved
around appalling road safety levels
of young drivers. Whiplash – which
should be identified as a neck injury or
impact on movement of the neck, was
mentioned Cameron but as Jackson
was coming in anyway there wasn’t a
huge discussion.
wallis: This isn’t good business
as it creates resistance. A proper
roundtable was needed.
Starling: It’s important for to know
however that the focus was on how to
lower insurance premium, not the small
claims limit.
Bott: To raise the Small Claims Limit
would be catastrophic. We’ll also see a
rise in the number of litigants in person
looking to save legal costs. But they’ll
take it all the way to court. Litigants
in person rarely know what a good
outcome is and won’t have anyone to
manage their expectations. This will
change the court system and clog up
the process.
hughes: The man in the street could
cause chaos in the system by going all
DoCToRS ChAMBERS
Doctors Chambers was established in 1994 by a group of doctors
working in Oxford. The company is the UK’s largest truly independent
medico-legal organisation. It remains in the ownership of doctors,
supported by a strong and experienced management team. We can
provide instant in-house medical expertise to our staff and customers
and ensure the highest level of clinical governance.
Our extensive experience and medical expertise makes us
well placed to assist with all types of medical evidence from the
straightforward whiplash cases to more complex cases requiring highly
specialised medical experts. We are able to arrange all investigations
and treatments and through our sister company, Bodycare Clinics,
can provide rehabilitation services, both physical and psychological.
As a new service to our clients we can also provide document sign up
ML // January 2013
the way to the Court of Appeal – litigants in person don’t give up and this isn’t
a better alternative for insurers. Professional organisations such as CMCs filter
claims. If you remove this level of filtering then what we have next is a rise in
have-a-go litigants in person.
Bott: Who are convinced they always have a case...
Meredith: It’s time consuming as a solicitor to explain to clients why you can’t
take their case on and to manage expectations.
Scully: It should be no medical, no damages. Clients in the third party assistance
scheme are put off when they’re told to go through a medical – fraudsters know
the pre-med assessment is an easy way to get compensation.
hughes: There has been a peak in the pre-med offers but it’s worth noting that some
claimant law firms prefer £1,200 for doing very little and taking a pre-med offer
Scully: That is a sad situation
hughes: However, very few settlements are made through a pre-med offer. There
are different models and ultimately the insurer decides when to offer.
vinayak: The approach to medical reporting and fraud, as a doctor, is clear. We have
to maintain credibility and authority in our assessments but the former understanding
- that these reports may be used in court and that the doctor will have to defend their
judgement – has changed. Since MROs, the message to doctors is that solicitors are
look for opinion and prognosis, not for authority in court. So the medical report has
limited impact. How experts are instructed does need to be looked at (in terms of an
independent panel which some offer already) to create a better product.
Bott: It’s hard to get a medical report that looks any different from another due
to mechanisation. Speed-wise, this is great but in terms of diversity and specifics,
this is lost. The report model doesn’t allow for anything off-piste. Also, I’ve never
once sat in front of a GP and been told I’m lying – they may challenge but they
don’t cross-examine. GPs don’t have the solution.
vinayak: In PI, reports are commoditised but consultant’s reports include a full
set of records. However they are paid more.
Scully: The problem is it this system makes it easier for fraudsters.
hughes: The difference between valid whiplash claims and fraud needs to be
clarified. To be fair, insurers do challenge and win. But we need to concentrate on
these cases in terms of fraud, not serious injury.
Layfield: The small claims limit doesn’t get to the heart of the reform focus,
which is a government-led agenda.
within any specified time frame in all parts of the country.
We are leaders of innovative technology as evidenced by our ‘SMART’
suite of software. Allowing doctors to produce high quality medical
reports and upload them instantly over the web. Many of our services
are now web accessible. This includes
a real time online medical appointment
booking system for GP and Orthopaedic
appointments. We are able to fully
integrate our IT systems with our clients.
01753 448010
laspo@doctorschambers.com
www.doctorschambers.com

MLM: Is QoCS (one-way qualified
costs shifting) effective with
particular recourse to Part 36 and
discontinuances?
nesbit: Negligence claims in Part
36 offers are always a risk. How can
you ensure against a lawyer’s own
negligence, especially when the
judge decides slightly lower than
the commonly held solicitor view on
damages. And the impact of QOCS on
these cases?
Meredith: It sets a precedent in high
profile cases and is extremely worrying.
If the judge doesn’t apportion, sit down
and go through the heads of damages
then it results in lives being seriously
affected by these decisions.
hughes: It begs the question as to why
a one-size-fits-all approach has been
used here. These cases are run by
completely different lawyers to those
in mainstream PI and now we’re left
with something that’s unacceptable in
these types of cases.
Meredith: It’s absolutely horrendous
for multi-track cases and how will this
benefit anyone?
Bott: We need to look at where QOCS
should be applied, as Michael Napier
said: ‘QOCS for all or none at all’... This is
just another raft of reform set for April
2013 which seems to be a ‘go live’ date
rather than the date by which everything
will be ready, tested and deliverable.
ECLIPSE LEGAL
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Management software for firms operating in the personal injury sector.
Our Proclaim software solution is in use by over 18,000 individuals
in all areas of work. Proclaim users span the entire sector including
claimant and defendant law firms, Alternative Business Structures,
accident management and hire companies, insurers, medical reporting
agencies and costs drafting firms.
Proclaim provides a complete Case Management solution,
integrating data storage, document production, workflow, task
management, reporting, financial analysis, and links with referrers and
suppliers. As standard, Proclaim integrates via ‘A2A’ with the Ministry
of Justice’s low-value RTA claims portal.
The new Proclaim ABS PI system provides a complete solution for
nesbit: The discontinuance issue is
very important. Evidence is not always
disbursed at the start of a case and if
the claimant is fraudulent then they
have to hunt around to get evidence
– if this is the case, those who are
rumbled shouldn’t hide behind QOCS,
they should be punished.
Bott: The problem is the police have
bigger fish to fry...
Clarke: Lawyers should then make
sure clients suffer as a consequence of
being fraudulent.
hughes: I don’t think the number of
‘have a go’ cases will rise under QOCS
but I do see this being a problem with
discontinuances.
MLM: one year on, have ABSs affected
the marketplace and how might they
be set to in the near future?
nesbit: It’s probably too early to
say, although it’s not the volume
of applicants that would affect the
marketplace, it’s who has come
forward and been approved.
hughes: Private Equity firms are waiting
in the wings and there are clearly some
strategic ideas out there but phase two
will bring the exciting ideas and models
forward. We have New Law and the
Brightside Group to come [as at time of
print], as well as others with significant
backing for investment.
Bott: Once brands of a certain size
come forward (such as Tesco), then
we’ll see an impact. However, there’s
still the issue of reform in PI and even
the likes of the Quindell Group and
the Co-op have to work with the
restrictions and regulation.
Clarke: It’s true though that big
business can bring things to the
industry. The SRA will turn things
around faster as it gets more
experienced and with less and less
people looking to become a partner
in a law firm, Generation X might look
at the new landscape in a better light.
Although the number of applications
approved has been slow, the SRA is
doing its best to get them through.
It doesn’t want to go outside of the
box in fear of getting it wrong and the
reaction that would cause.
MLM: finally, what role will mediation
play in the Jackson era?
Clarke: Mediation is being used in
difficult cases where joint settlement
meetings have failed, with a settlement
rate of 90%. The question lawyers have
to ask is, is settlement better than an
all or nothing outcome, especially for
issues over accommodation etc. In the
multi track a mediator can be attached
to a case without slowing things down
and FOIL has now set up a roundtable
to look at mediation.
wallis: Roundtables are often used but
there are no outcomes. This might be
due to personalities etc. This should be
a clear message, not to fee earners but
to partners; that cases which should
have settled haven’t – perhaps they
need to delve into why. Roundtables
quite often are not set up properly.
If both sides can come to mediation
early on – on those 5% cases which
are difficult and parked - they can be
settled. There needs to be a push from
the defendant side to get mediation
used in these cases as well as from the
judiciary. The Jackson ADR handbook,
published in the Spring, is as much for
the judiciary as for practitioners. I’m
hoping this will have a positive effect.
Alternative Business Structures wanting to manage the entire process
(claims management, vehicle hire, injury litigation and medical reporting)
under one roof.
“Proclaim ABS PI system is a unique solution, and any personal injury
organisation wanting to survive and thrive must
seriously consider adopting it.”
James Maxey (Partner), Express Solicitors
• Call Eclipse on 01274 704100
• Email us at darren.gower@eclipselegal.co.uk
• Visit www.eclipselegal.co.uk
• Follow us at @Eclipse_Legal
Features 39
ML // January 2013

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April 2013 has been classed as a
Q ‘doomsday’ by leaders in the PI
claims sector due to the number of Civil
Justice reforms coming into force at the
same time. one of the main issues is
that regulators aren’t providing enough
information on boundaries (i.e. what
is acceptable) in reforms such as the
Referral fee ban. This has led – some
argue – to delays in business plans for
the coming year and a state of flux –
what should the regulators be doing
and what is the MoJ doing to help?
aIt will happen in April, with no
delay. The onus has to be on
regulated organisations to provide
a business model that’s compliant
with the LASPO Act, although every
organisation is different.
But regulators - including the SRA,
MoJ, FSA, etc. - are in dialogue with
regulated organisations to help them
change their models if suitable to
ensure they are complying with the
requirements of the regulations.
Qwhat role should / will
the Government have in
communicating the changes to
the general public in terms of how
QoCS will work? will the public be
increasingly savvy in terms of using
legal services?
aRegarding QOCS (qualified oneway
costs shifting), there has been
considerable consultation about our
principle reforms over the last two
years: LASPO and the Jackson reforms
and their implementation. Claimant
organisations have had time to adapt
and communicate the messages and
there has been wide engagement with
stakeholders and all the important
information on reform and costs is on
the MoJ website. In reality it should be
the legal representative who disperses
and explains information on this
type of cost protection to the client.
In terms of savvy customers, yes, I
would expect people to be shopping
interview with...
Helen Grant MP
Emma waddingham (Chief Editor of Modern Law) speaks exclusively to helen Grant
MP, Parliamentary under-Secretary of State, Minister for victims and the Courts, about
LASPo, tackling fraud and the burden of business planning for practitioners and their
organisations in light of new (and still unclear) regulatory boundaries.
around in terms of legal services. This
is a good thing; there will be more
competition in terms of fees and what
firms choose to charge.
Qwhat is next for whiplash claims,
considering the consultation on
this and the small claims limit?
aThe Government is absolutely
determined to tackle fraudulent
whiplash claims whilst, at the same
time, ensure people who have suffered
genuine neck injuries continue to get
compensation. In terms of the key issues
being consulted on (whether to raise the
small claims limit for RTA PI cases and
asking for other possible solutions for
dealing with fraud), there will be a series
of stakeholder events to allow us to
canvass and ask opinion from all those
who operate in the PI sector for both
claimants and defendants.
QIs there an issue to be addressed
regarding the limitation of claims
management companies (via the
Referral fee ban) to assess claims in
the first instance. As it stands, lawyers
(both sides) are concerned about the
rising number of fraudulent claims that
may end up being processed if claims
are not being screened by CMCs in
the first instance (see the Referral fee
Roundtable on pages 37-39).
aI’m not aware of any evidence that
they screen for fraud. There has
been a sharp increase over the last six
years for fraud and CMCs are not as
effective as they could be to tackle this.
The obligation has to be on the solicitor /
other legal representative conducting the
case to look at this matter. Lawyers must
still be very careful indeed to ensure they
are not taking on fraudulent cases. The
insurance industry set up its own fraud
database (funding £9 million over the last
three years on a specialist list) and there
have been discussions about sharing this
information with claimant lawyers - a
very helpful initiative if achieved.
Features
helen Grant MP, Parliamentary
under-Secretary of State for
Justice, women and equalities
41
Helen’s responsibilities through this
role within the Ministry of Justice
include looking at: victims and
criminal injuries compensation; the
courts, tribunals and administrative
justice; civil law and justice; law
reform and sponsorship of the Law
Commission; legal services and
claims management regulation, and
(amongst others); better regulation
and growth.
Before this appointment Helen
served on the Justice Select
Committee until 2011 and was
appointed to the Conservative social
justice policy group in 2006. She
joined Iain Duncan Smith’s think
tank the Centre for Social Justice for
which she has written extensively on
family policy.
Helen read law at Hull University
and practiced as a family solicitor
since qualifying in 1988. She set up
Grants Solicitors in 1996 - focusing
specifically on the problems of
family breakdown. Helen is the MP
for Maidstone and the Weald and is
married with two sons.
ML // January 2013

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laSPo fiaSco
A new year is finally upon us and in less than three months the LASPo Act comes
into force. Russell Smart the impact of the ‘fiasco’ on legal expenses insurance for
litigators and their businesses from 1 April.
Despite warnings from
many leading figures,
the Government seems
intent on implementing the
LASPO act on 1 April which
will surely leave a lasting
impression on millions. What
started as a one-man mission
to reduce costs in civil cases
has ended with dismantling
one of the finest legal systems in the world - which was
the envy of many - only to be replaced with a series of
disjointed and ill-thought out proposals.
So who are the winners? Well, probably only motor
insurers. We are told that personal injury cases cost
motor insurers £2billion per annum or about £90 per
policyholder. This is a headline-grabbing figure until you
consider that drivers spend £8billion a year on parking
their vehicles. In addition £90 looks reasonable when
you consider that the Government wants everyone (not
just drivers) to purchase BTE (before the event) legal
expenses insurance. This currently costs, on average, £30
per annum but is likely to rise considerably to European
levels once a ban on referral fees comes in to force.
ThE ALTERnATIvE
Without widespread BTE insurance there are few
other workable funding alternatives for the majority of
litigation disputes. Litigation funding is only suitable
for cases where there are large levels of damages but
comparatively low legal costs. This works by litigation
funders advancing costs to pursue cases in exchange for
a percentage of the client’s damages. If the damages are
high but costs are low the proposition is attractive to a
funder who usually seeks a ratio of damages four or five
times greater than the potential legal costs.
ATE (after the event) insurance has worked well
historically because the levels of damages have been
largely irrelevant to an ATE Insurer, as premiums are
calculated according to the risk of paying disbursements
and opponent’s costs. Post LASPO however, if premiums are
paid out of a client’s damages then only the cases attractive
to litigation funders will be insurable by ATE insurers. It
is precisely this reason why LJ Jackson recommended
QOCS (Qualified One-Way Costs Shifting) as a counterbalance.
However the Government appears to be seeking
to introduce QOCS for some types of litigation but not all -
despite banning ATE premium recovery across the board.
Features
Lord Justice Leveson alluded to this problem recently
following his Inquiry into the Culture, Practices and Ethics
of the Press and on 12 December 2012, a ministerial
statement was released stating that the: ‘provisions
relating to sections 44 and 46 of the Legal Aid, Sentencing
and Punishment of Offenders (LASPO) Act 2012, which
would remove the recoverability of success fees and
insurance premiums, will not come into force for defamation
and privacy claims until costs protection has been
introduced for these proceedings’.
The funding problems highlighted by Lord Leveson
are not unique to privacy and defamation cases and the
same principle applies to any litigation where damages
are not at least four or five times greater than the legal
costs of pursuing the case.
What is clear is that unless QOCS is introduced for all
litigation, ATE insurance premiums will not be affordable
for the vast majority of cases.
QoCS foR ALL
If QOCS is introduced for all litigation then opponents’
costs effectively become capped which results in more
affordable ATE premiums. Early indications suggest that
ATE Lite premiums for personal injury cases are likely
to cost in the region of 12%-18% of client’s damages.
However with 25% already being deducted it remains to
be seen as to whether the market will remain viable.
Let us not forget that the intention of LASPO was
to reduce the Legal Aid bill by £350-£400 million. So
will the proposed reforms to civil litigation save the
Government money?
A quick look at the arithmetic suggests not. The HMRC
will lose £200m in VAT contributions on solicitors costs
alone if the proposed fixed fees go ahead on RTA portal
cases (assuming there is no reduction in the 800,000
cases each year). Local government and businesses will
certainly be on the receiving end of more claims if QOCS
is introduced and if the small claims limit increases then
claims management companies will jump into the gap and
run cases themselves like they have with PPI claims.
Whatever the outcome, I still can’t help thinking that the
best solution is the one the LEIG proposed three years ago;
where clients pay their own premiums but premiums are
recovered from an opponent for successful post litigated
cases only.
Russell Smart is Chief Operations Officer, Elite Insurance
Company Limited.
“local government and businesses will certainly be on the receiving end of more claims
if QocS is introduced and if the small claims limit increases then claims management
companies will jump into the gap and run cases themselves like they have with PPi claims”
43
ML // January 2013

ealitY cHeck
Paul Addison stresses the importance of checking the current and future
development landscape near a property to keep house-buying clients happy.
Imagine this
scenario. Your
client buys a
nice detached
house in a
desirable area.
Eighteen months
later, he discovers
that a developer
has been given
permission to put
up two houses
that will overlook
his property,
detracting both
from its value and his enjoyment of it. To rub salt into his
wound, he also hears that the neighbour who sold the land
to the developer has benefited by a decent six figure sum.
Then think about this alternative situation. Before your
client agrees to buy the property, you suggest that it might
be worth running a check to see if there are any current or
potential development threats to it. The report you receive
reveals four sites that could be of interest to developers,
two of which are active. One already has permission
granted for two new houses, while a decision is awaited
on another. If built, these two homes would overlook your
client’s property. And that would still leave two other sites
with the potential for further development. As a result, the
client decides not to proceed with the purchase.
Who do you think would be the happier client? It’s no
contest is it? Yet amazingly, most people still go into the
biggest purchase they will ever make without first checking
that it’s not going to be affected in the future by developers
plonking a couple of blocks of flats or, even worse, a small
estate at the bottom of their garden. If people don’t think
the threat is real, consider this. Around 85% of urban
homes currently fall within a 75 metre radius of a potential
development site.
This situation is only likely to get worse. As leading
planning barrister, Martin Edwards, says: “Following
the government’s autumn Housing for Growth policy
announcement and its more recent statements about
planning reforms, it is clear that the acute housing shortage
will lead to planning authorities looking closely at all sites
with development potential. Identifying those sites provides
solicitors with the opportunity to add real value to the
service they provide their clients.”
Until recently there was no method for house buyers and
their solicitors to properly investigate future development
risks and allow them the opportunity to take a considered
view about whether or not to proceed with the purchase.
Now, for the first time, the option exists for them to not
only carry out searches into existing planning applications
that may affect a property but also to look for any threats
from nearby sites that could be exploited by developers.
When they do check, they frequently have cause to be
grateful – and not just in the negative sense. For developers
can present opportunities as well as threats for home
buyers...and sometimes both!
Take this recent case as an example. We provided a
report to solicitors acting for the buyers of a 1930s threebed
semi which revealed that a neighbouring property had
been given permission for eight new houses to be built.
The development, if it went ahead, would have a negative
impact on the view from the rear of the house.
Copies of the title to the neighbouring land, controlled
by the developer, showed a restrictive covenant that
could benefit not just the solicitor’s client but three of
their neighbours. They could choose to either block the
development or negotiate a release with the developer.
They chose the latter, and all four ended up with a five
figure financial windfall. The solicitor also gained three
additional – and grateful – clients!
“now, for the first time, the option exists for
them to not only carry out searches into existing
planning applications that may affect a property
but also to look for any threats from nearby sites
that could be exploited by developers.”
Even waterfront properties can have potential problems
– and not just from flooding. We were able to point out to
one home buyer that the view from the apartment he was
thinking of purchasing could be somewhat spoilt by a sixstorey
floating hotel that had been given permission to be
moored permanently on the water opposite.
In that case, the buyer still chose to proceed. But he was
able to do so with his eyes wide open. Knowing what the
future may hold can at least help home buyers to make
properly informed decisions.
Jeremy Jupp, Head of Conveyancing at Morrisons
Solicitors, explains: “Many buyers think that the local search
will provide information about planning applications that
have been submitted in the local area, but it does not.
“A report that provides information not only about
existing planning applications but also a professional
opinion on the potential for future nearby development
is a hugely valuable resource and fits with our ethos
of providing a first class service that fully supports our
clients’ needs.”
Paul Addison is Managing Director, DevAssist Ltd.
www.dev-assist.co.uk
Features 45
ML // January 2013

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a Bird’S eYe VieW
Riverview is one of the new breed of legal businesses created to deliver corporate
legal work based upon the premise that law is just another business service.
Pulling on external funding and maximising the use of technology, it’s a model
others in the sector are looking at intently. Karl Chapman, Riverview’s CEo, talks
to Mike Ames about the inner workings of the company.
how would you best describe
Q Riverview Law?
Riverview is a legal advisory
a outsourcing business that offers a
range of legal services to the corporate
world. At the bottom end is Legal
Process Outsourcing which covers
transactional non-advisory tasks that
can be done by non-lawyers or even
outsourced. At the top end you have
magic and silver circle international
M&A work. We’re focused on all the
legal advice in between.
Qnumber of employees
and offices?
aWe have over 100 people, 60%
of which are lawyers. But we are
recruiting heavily and expect this ratio
to change; ultimately we anticipate
employing more non-lawyers than
lawyers. Our core offices are situated
in London and Wirral which is our main
centre with 30,000 square feet of
space and we intend to fill it all!
Qwho owns the firm?
aThe shareholders, AdviserPlus
Business Solutions [Karl’s HR
outsourcing business], DLA Piper,
private individuals and the staff.
We are very committed to ensuring
we have wide employee share
ownership. This structure avoids
the usual ‘partnership baggage
or language’ that prevents quick
decision making – our directors and
management team function like any
other corporation’s does.
why did DLA Piper take a stake?
Q
we wanted a shareholder
a Well,
who had the same values as us,
who understood the changes taking
place in the legal market and could
move quickly. DLA Piper was a
perfect fit.
Qwhat sort of clients have you
already won?
aWe work with SME’s upwards but
our sweet-spot is large corporates
who really like our service and pricing
model and value the benefits we offer.
Naturally I can’t name our clients,
however, what I can say is that our
expectations have been exceeded in two
areas: large organisations and litigation.
QSo how are you different from
traditional law firms?
aWell it’s probably easier to say
how we’re the same: we employ
lawyers and we deliver legal advice,
but in particular:
• We use a fixed pricing model.
• We understand the power of
technology and management
information.
• Our lawyers do the law; our
managers manage and our sales
people sell. Why ask lawyers to do
things they aren’t great at?
QDo you have trouble
finding lawyers?
aPartnership can look risky and
elusive. We offer our lawyers a
good salary, bonuses, share options,
no additional duties over practising the
law, a career path and no timesheets.
Add this to a great culture and strong
values and, well, what do you think?
QLet’s look at sales now. how do
you win new clients?
aI head up BD and have 3 BD Heads:
Legal Advisory Outsourcing; SME’s
and Litigation. Each leader has a team
working with them giving us a total of 11
dedicated business developers but we’re
still hiring. Lawyers aren’t expected to
sell unless they want to. Our job is made
easier because we’re constantly being
approached by companies who’ve heard
about us and want to know more.
Karl Chapman, CEO, Riverview
Mike Ames, Flair
Features 47
ML // January 2013

48 00 Features ????
“Performance measurements are very important to us.
for lawyers we use kPi’s on technical accuracy, commerciality of advice,
plain english communications, accuracy of data input and client satisfaction.”
QDo you use a CRM system and if so what is it?
rely on Microsoft Dynamics CRM. Although
a We
Riverview only began in February 2012 our systems
and processes come from 11 years’ of development in
AdviserPlus. IT is crucial to our business model and allows
us to run extremely efficiently. We also offer our clients
access to enormous amounts of management information
through our Cloud portal. We simply couldn’t manage
without it. Having said that we know it’s still people that
make the difference!
QSo who ‘owns’ the clients within the firm?
company owns the clients not the individual
a The
lawyers as in many traditional law firms. The silo
mentality that this produces is destructive and we wanted
no part of it. Of course our clients have relationships with
the Riverview lawyers of their choice and larger clients
also have legal and relationship directors to ensure all their
needs are covered.
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for our large corporate clients. Should the actual question
be: is the partnership model really sustainable?
Qhow do you measure the performance of your
lawyers and business developers?
aPerformance measurements are very important to us. For
lawyers we use KPI’s on technical accuracy, commerciality
of advice, plain English communications, accuracy of
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WHo’S Been SaYinG
i’M Paranoid?
As personal injury lawyers are rumoured to be sharpening their teeth to steer
towards professional negligence claims from fast-track cases, Tony walton points
out some key reminders to professional peers...
As personal injury lawyers now realise the scale of
reduction in fees waiting for them in April, a minority
are said to be planning to turn on their former
professional colleagues and set up departments specialising
in more profitable negligence claims arising from claims
settled below their true value within the RTA portal.
The Thing is a gory science fiction film in which a team
of scientists in the Antarctic are infiltrated by an alien
capable of replicating almost exactly the humans it seeks
to destroy. It is of course rich in McCarthy-era paranoia,
harking back to when the original version of the film was
made. In one scene, known as ‘Tainted Blood’, the leader
of the embattled team attempts to establish how many
of his colleagues are infected. With everyone else tied up
together, he tests blood samples in a series of Petri dishes
until, inevitably, the alien shows itself by transforming one
of the team into something very aggressive and slithery
which promptly, but vividly swallows up one of the others.
Our regional meetings were never like this.
Not until now, anyway. From the depths of my naivety,
I thought there might have been some sincerity behind
firms’ website promises about their commitment to
compensation claims for accident victims. The vast majority
of law firms engaged in those claims will continue to be
true to that stated aim and I wish them well. There is,
though, something deeply unattractive about those who
turn on their own; more so at a time when our branch of the
profession needs to improve its image.
At the heart of the matter is the commoditisation of
the volume market in legal services, of which portal work
comprises a significant and high profile part. The use of
paralegals to handle claims is a particularly sore point. Any
legal service delivered by a paralegal, so the argument
goes, must be inferior. I can’t help feeling there is more than
a little snobbery behind all this, with confusion between
status and competence. Is there something magical which
overnight transforms a trainee on the last day of his or
her training contract into a superhuman when they go to
work the following morning as a newly qualified solicitor?
Are they no longer in need of supervision and somehow
incapable of error?
It is a mistake to equate the use of junior lawyers with a
lack of sophistication. In our case, you’ll be confronted with
a culture of rigid quality control through close supervision
and comprehensive auditing. Handlers will almost always
be 2:1 or higher LPC graduates. They are given reasonable
case loads and targets which don’t require exhausting long
hours to be achieved. Supervisors have no case load of their
own and spend all their time just supervising. They have a
working knowledge of all of the cases being handled in their
team (only four handlers in a team). Supervision is step-by-
step throughout the case, belying the ‘only-if-you-have-to,
can’t-you-see-I’m-busy?’ image that many expect. Auditing
is via a detailed 100 point form, not the perfunctory tickbox
exercise that has been the undoing of so many in the
past. So, you and whose army?
To be fair, there may well be claimants out there who
have had their claims under-settled and who are entitled
to additional recompense. It may also be inevitable that a
minority of lawyers will show no shame in quickly dropping
the pretence of commitment to one cause in favour of
another which just happens to be a lot more profitable.
They must not be allowed to do so without consequence.
It is a matter for the respective organisations and their
leaders, but to me it seems incompatible with membership
to advertise for potential negligence claims where such
claims may be against fellow members: you are either in or
you are out.
At the same time, bowing to the inevitability of such
claims being made, those who stay loyal to the cause must
benchmark themselves against best practice and give as
little opportunity to their former colleagues as is humanly
possible.
It is trite to say this is simply about better service for
claimants. It is sad that evolution will be forced upon us by
such negative pressures. Nevertheless, we must go forward
in a direction which on the one hand acknowledges that
we currently maintain close links with the very people who
may soon seek to earn a living from suing us and on the
other offers the smallest opportunity for them to succeed in
doing so.
Tony Walton is Managing Director of Questus,
the legal outsource specialists.
www.questus.co.uk
Features
49
ML // January 2013

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BuSineSS
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Business Management 51
ML // January 2013

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MLFP000105072012

Practical help for
challenging times
Antony Smith reports on a key conference aimed to add fuel to legal ‘machines’
across England and wales, with a particular focus on what firms are doing right in
terms of structure and marketing ahead of a stressful year ahead.
The Law Society Law Management
Section conference, held in
November 2012 (chaired by Andrew
Otterburn), began with what turned
out to be a keynote address by Simon
McCrum, managing partner of Darbys
solicitors. Simon’s called ‘more fuel
and for a good machine’ - the machine
in question being a law firm. While
he noted the ‘secret ingredients’
of a successful law firm are ‘good
people, more good people and yet
more good people’, it was striking
how much emphasis he placed on
the systemisation of most aspects
of law firm operations. This became
a recurring theme throughout the
day. Different speakers emphasised
the importance of adopting systems
based thinking for almost all areas of
law firm management, whether it be
strategic development, nuts and bolts
of procurement or dealing with people.
SPoTLIGhT on SuCCESS
In 2007, immediately before Simon
was recruited as managing partner of
Darbys, the firm was at the commercial
equivalent of ‘death’s door’ (his phrase,
not mine). The situation has improved
dramatically since. Space does not
permit anything like a full review of
Simon’s talk, let alone all of the other
speakers as well, but a brief summary
should help give a flavour of the event
and show how rooted in practicalities
the conference was.
So what has Darbys done to turn
things around?
• Emphasis on changing the culture to
one of openness, transparency and
sharing of information – no room now
for ‘information silos’ or, more bluntly,
for people to hide behind generalities.
• The importance of having good
people has been noted above but also
worthy of note is that Darbys had 80
lawyers in 2007 and out of those only
20 remain with the firm today.
• There is a strong management team
in place, made up of the Finance
Director, Operations Director and
team leaders / group leaders. Some
team leaders were at the time junior
lawyers with the firm in 2007.
• There is a relentless focus on cost
management and cash collection.
• The systemisation theme continues
with the automatic enrolment of
all new clients into either Darbys’
‘purple legal’ scheme for private
clients or ‘blue law’ scheme for
businesses. Darbys has also
automated a centralised crossselling
system, so if they do a will for
someone for example, that person is
kept in touch with Darbys via ‘blue
law’ updates and they are offered
other legal services by Darbys. The
emphasis is on systemising and
centralising this function, so that
cross-selling is no longer left at the
mercy of individual client partners.
• Darbys has embraced a client centric
culture, summed by providing great
client service by ‘every lawyer, every
time’. Some may dismiss this as
superficial marketing but the phrase,
allied to the transparent culture,
actually puts responsibility on every
lawyer to deliver every time.
After the conference I had a look at
the firm’s website, and I was impressed
(http://www.darbys.co.uk/). It is quite
unlike the vast majority of law firm
websites. None of the usual: ‘we are
experts in…’ and ‘about our team...’
etc. The front page is light and client
focused.
The firm is expanding, having recently
opened an office in Manchester within
the last year, and plans to open other
offices shortly. It recently held an
internal competition for its associate
solicitors to present a business case
Business Section 53
for a new office location and one team
was so enthusiastic they had some
pens made with ‘Darbys in [the town
name of their preferred new location].’
The reward for the winning team will
be to see a new office opened in their
preferred location.
TEAChInG oLD DoGS nEw TRICKS
With so much attention given to new
market entrants and their expertise
in client services, marketing and staff
development, it is refreshing to see
what may be called a more traditional
legal service provider make huge
strides in these areas as well. Perhaps
Darbys show that small and medium
traditional law firms are not, as many
people believe, doomed after all?
Time will tell.
Other speakers took up many of
the themes referred to by Simon,
such as leadership styles (Michael
Shaw, Michael Shaw Associates),
helping change personal behaviours
at work (Julie Harrison, Julie
Harrison Consulting Ltd), practical
tax and accounting issues for law
firms (Andrew Allen, Frances Clark
LLP), implementing strategy in law
firms (Nigel Haddon, SAS Daniels)
and practical ways for managing
procurement (Sarah Charlton, ILFM).
Steve Arundale (Natwest) outlined
issues to be considered in connection
with potential law firm mergers
while Patricia Kinahan (Hazlewoods)
summarised results from the latest
LMS benchmarking survey.
Overall, a very worthwhile event and I
am already looking forward to the Law
Society’s Law Management Section
Annual conference later this year.
Antony Smith is the Director at
Legal Project Management Ltd.
www.legalprojectmanagement.co.uk
ML // January 2013

54
Business Section
Q: What do new entrant ABSs have to do differently
to a traditional law firm to win more work?
Law firms have traditionally generated new work
A: through referrals and existing relationships with little
pro-active marketing. It is difficult for new market entrants
to break into these traditional arrangements.
To win market share, many new entrants have attacked
the perceived weakness in marketing of traditional law firms,
developing strong marketing capability using search engine
optimisation and digital technologies to gain a competitive
edge. However, many are finding the work generated is not
of sufficient volume or quality to cover the cost of acquisition
or make profit. Their assumption that more consumers will
go online and undertake legal tasks has not yet materialised.
Studies show that for less complex work, consumers are
increasingly going online as their first port of call, although
mainly to research a legal area and evaluate potential law
firms. However, when it comes to actually discussing a legal
issue, they still consider face-to-face contact with a solicitor
important. Interestingly, many then prefer to work with a
firm offering technology to track their matter online.
To gain market share, it would appear that new
entrants should refine their marketing, moving from pure
lead generation to lead nurturing and focus on helping
consumers with their research by including lawyer profiles
and case studies, then delivering a value proposition
that includes face-to-face contact as well as a full online
experience for a fixed fee.
For commercial work, legal services for large corporate
clients and government is a relatively mature market with
a sophisticated and experienced client base, clear market
leaders with a strong brand presence and established
procedures in place. In contrast, the SME market offers
greater opportunities as many find it difficult to differentiate
one legal provider from another. There are significant
opportunities for ABS’s to gain market share by introducing
disruptive value propositions to this market. These would
include: introducing subscriptions and fixed fees where
possible; creating online legal services and documents for
more straightforward B2B legal tasks; developing their
website to enable a business client to track a legal matter;
differentiating by gaining an understanding of a client’s
industry sector and getting ‘under the skin’ of clients
business; offering low-cost, or free, consultancy and advice
on creating an internal legal services policy and procedure.
It is clear that new entrants can and will continue to
win greater market share from traditional firms. They need
to stay focused on their differentiators, refine marketing
efforts and deliver compelling value propositions with a
better experience and better value for money than their
counterparts. In this way, they can go on to build brand
reputation and loyalty and build a profitable business.
Jitendra Valera, Chief Marketing Officer, IRIS Legal.
For a fuller version of this article,
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Watching, waiting – Innovating?
unprecedented change in the legal sector has led to many focusing on doing
what they do best, along with a need to reduce costs. Richard forth asks if
this offers more opportunities to work with outsourced expert consultants and
if they are innovating their offerings for clients, as well as addressing change
in the PI sector.
The current extensive
developments in the
legal market are self
evident from the press.
However, perhaps it is
reasonable to state that
the sector contemplating
the largest scale changes
is the personal injury (PI)
sector, particularly those
practitioners and firms
operating in the higher volume / lower value area.
It seems that in the 15 years in which I have worked
closely for PI firms there have actually been very few
periods when significant changes have either not been
expected or have been bedded in. In my view, if nothing
else, it is a credit to the entrepreneurial spirit of the
practitioners operating on the Claimant side of the fence
that they have managed to quickly adjust their business
models and prevail regardless of the same.
Whether for good (from the Claimant perspective)
or for bad (from the Defendant perspective) such
entrepreneurs have taken a seemingly ever-changing
business environment and driven substantial efficiencies
into their fee earning processes. This is particularly
prevalent at the volume end of operations to generate
ongoing profit streams, which they have invested in
further process enhancements and case acquisition to
grow their businesses - in some cases in an ongoing
upwards spiral.
As the handling of PI claims has become increasingly
more process driven, a huge ancillary industry has built up
in support of the PI sector.
Some of these ancillary services are simply enhanced
traditional services such as barristers providing advice on a
much more volume orientated basis.
However, a vast number of other services have developed
in response to changes to, and the streamlining of, the
PI market, such as medical agencies who have driven
significant efficiencies into the procurement of medical
evidence and specialist costs consultants who externally
assist in costs recovery given the increased complexity of
the costs regime.
Even my own discipline of forensic accountancy has had
to develop and think more laterally with regards to service
proposition, in that it’s no longer satisfactory to simply offer
expert reports on larger cases. The market now demands
abridged expert reports (for expert input on smaller cases),
white-labelled / agency work on schedules, advisory /
shadow work, etc. on certain aspects of cases.
Whilst changes have been afoot in the PI sector, never
has there been a period where so many fundamental
changes are due to happen at the same time and,
consequently, the uncertainty with regards to what the
future holds has never been more palpable.
Ultimately, the mechanics and the practicalities of
such changes will determine what market there still is for
certain ancillary providers and, indeed, what if any new
opportunities arise.
The devil (as they say) is in the detail and there is
currently insufficient detail (with conclusions to various
consultations still outstanding) for there to be any definitive
answer to the question posed.
In my mind, of paramount importance to the ancillary
market as a whole, is how big the PI sector is after the
effects of the potential changes have taken hold, which
obviously has a direct correlation to the opportunities that
still exist.
In this regard, what seems certain is that the level of
incidents for which compensation could be claimed is
unlikely to materially reduce. The question is how many
such incidents will now find themselves into the revised
compensation systems compared to current levels.
Regardless, I believe that with the degree of change in
the pipeline there will inevitably be opportunities created
for certain organisations at the potential expense of others.
“the whole of the market will no
doubt be holding their collective
breaths as 2013 unfolds”
With regards to the new proposed FRC scheme, if
there is no fundamental change to the levels of costs
proposed for RTA / EL / PL cases after the consultation
period, then it would appear clear that the amount
of work undertaken on a case-by-case basis will be
significantly reduced. True even for those practitioners
who wholly embrace DBAs as a way of supplementing
the FRC and, consequently, there may be opportunities
for suppliers of certain external services.
To what degree this can be practically achieved will be
determined by the new processes and protocols put in place.
In my opinion; if the past is anything to go by, the level
of proposed change will inevitably lead to opportunities
for certain protagonists in the PI sector. However, clarity is
not possible as yet with regards to the nature of the same.
The whole of the market will no doubt be holding their
collective breaths as 2013 unfolds.
Richard Forth, Forths Forensic Accountants
www.forthsonline.co.uk
Business Section 55
ML // January 2013

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RTA Costs Reduction: the business impact
1. They approach legal service
delivery as a business, servicing
a market in similar ways to
many other sectors. This sounds
painfully obvious, but most ‘new’
techniques and methods now
starting to be applied to the legal
market have in fact already been
applied successfully in other
markets.
2. The client is put at the centre
of the organisational ethos and
effort. An increasing number of
legal service providers really do
live and breathe client service and
try to understand what constitutes
good service from the clients’ point
of view.
3. They have strong senior
leadership, and a clear strategy
which is known and understood
throughout the organisation. The
strategy is then implemented by
good management teams who
trust their frontline staff.
There’s no point in worrying about the referral fee ban as with the figures being
presented in the recent consultation on portal costs there is nothing in the pot to pay
for referral fees in any event.
The Government, in its wisdom, has chosen to simply deduct £700 from the current
costs figures for under £10k, which apparently reflects a referral fee that cannot now be
paid under LASPO and then giving remarkably low levels of costs for the much more
complicated cases between £10k and £25k in value.
It is entirely unclear why solicitors acting in personal injury cases should be the only
businesses in the private sector that have a £0 acquisition cost for work. My firm has
invested in a magic Claims Tree, which we are planting in the car park so that we can
get claims in for free. Whether non-prohibited referral fees are being paid or investment is made in online or media
advertising there will remain an acquisition cost for new work - it is simply unrealistic to expect otherwise.
Very few recent consultations have brought about any change to the original proposal so it is therefore highly unlikely that
we will receive any real movement on these figures. That being the case it will mean a number of smaller PI law firms with
no ready and cheap access to work will simply have to close their books to new work and attempt to recoup their WIP.
All those claims management companies that are dealing with low numbers of cases (less than 20) will be unable to
sustain themselves, particularly if they bought in work. What this will mean is that those lawyers continuing to do this
work will have no choice but to take a deduction from client damages of anything up to 25% of general damages to try
and balance up the overhead and acquisition cost element of the work.
Although of course it may be that this is exactly what the Government is trying to achieve.
Alan Nesbit, Managing Partner, Nesbit Law Group LLP.
Trends in legal service delivery
After speaking to some innovative law firms and attending some interesting legal industry events recently, Antony
Smith believes there are some common trends emerging in the more innovative legal service providers:
4. Senior positions such as
operations directors and pricing
directors are becoming much
more common, often supported
by people in roles such as legal
workflow and process analysts,
legal project managers and legal
client managers to name but a few.
5. There is a lot of interest in process
mapping and analysis of all key
processes which make up the
delivery chain.
6. More of the larger law firms now
employ client facing legal project
managers to assist with service
delivery and build closer client
relationships. This is now having a
trickle-down effect to some of the
mid-sized firms.
7. Business development activity is
no longer viewed as a necessary
evil but something positively
welcomed by more legal service
providers, they seem to enjoy this
at least as much as practising law.
Business Section 57
8. Fixed pricing is of course now
very common. I also suggest that
more firms are now alive to the
possibilities of pricing based on
value delivered rather than simply
offering fixed prices which are in
reality no more than conversions of
hourly rates into a fixed price point.
9. Management by metrics is
becoming more prevalent.
10. I.T now permeates all aspects of
legal service delivery and there is
little doubt that the influence of I.T
on legal service delivery is set to
increase even further as the new
legal service market develops.
Antony Smith, Director,
Legal Project Management Limited.
www.legalprojectmanagement.
ML // January 2013

58
Business Section
Q: Are the Solicitors Accounts Rules 2011
for COFA’s a Conundrum?
At our recent seminar on COFA
A: Compliance for the Middlesex
Law Society (which also featured a
presentation from Deborah Edwards,
Head of Training & Support Services,
Insight Legal Software), a conundrum
arose when it was noted that an agreed fee must be paid
into office account in accordance with rule 17.5.
The following questions were raised:
1. Can a solicitor charge for a fixed fee before the work is
completed?
2. How is the client protected in these circumstances
when the work has not yet been completed?
3. Should a prepayment of this fee be retained in the
client account before then transferring to the office
account once the work is completed?
4. What is the position with regard to the date and tax
point of the invoice?
However following the Rule 17.5 is precise in requiring
payment into Office Account:
A payment for an agreed fee must be paid into an office
account. An ‘agreed fee’ is one that is fixed - not a fee that
can be varied upwards, nor a fee that is dependent on
the transaction being completed. An agreed fee must be
evidenced in writing.
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This seems to call into question two of the overriding
SRA Principles in the SRA Code of Conduct namely that a
solicitor must:
No. 4: Act in the best interests of each client;
No. 10: protect client money and assets.
If payment of Fixed Fees takes place before the work is
completed then this could put client money at risk until
completion of the work? Hence an apparent conflict with
Principles 4 and 10 to protect client money.
HMRC would, I presume, consider that the Tax Point
for VAT purposes is for the total amount at the outset,
whenever a Fixed Fee was agreed. The whole of the VAT
being payable, irrespective of when payment is actually
made by the client.
An SRA spokesperson said: “Issues around client
money are ones which the SRA will be looking at in more
depth over the coming months. For example, we said in
September [2012] that reducing the need for solicitors to
hold client monies during conveyancing transactions could
help reduce the risk of mortgage fraud being committed.
“This is therefore an area of development that could see
changes to the Handbook made and we will keep Modern
Law Magazine readers posted on any developments at the
appropriate time.”
Paul Wilkinson, Managing Director, Lawclient Ltd.
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PPL 24407 Modern Law Half Page-1112.indd 1 08/10/2012 16:06

Effective Dispute Resolution
recently gave a talk to a
I local law society entitled
‘Is Litigation fit for Purpose
in the 21st century’. That was
intended to suggest that most
contentious lawyers feel a tad
queasy outside the ‘litigation’
comfort zone.
Your first job so far as the
client is concerned is as dispute
resolvers. They want your assistance to solve their
problem as quickly and inexpensively as possible. We
all know only a couple of percent of cases go all the way
to trial, and on average it takes more than a year to get
there and at considerable risk and cost. Along the way
cases settle pre-action, post pleadings, post evidence.
The deeper into the process the greater the proportion of
costs all well demonstrated in the Jackson Report.
In Richard Susskind’s book with the tongue in cheek title
‘The End of Lawyers’ he highlights the asymmetry between
lawyers and their clients and says that the modern forward
thinking firm is the one that ‘strives to align its commercial
interests with those of its clients’ keeping legal difficulties
and expense to a minimum’. That’s difficult to do when all
you know about is the CPR and little about arbitration,
adjudication, conciliation, mediation and all those other
different ways to resolve clients’ problems.
Do you need to review
matter-profitability and reduce
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Business Section 59
Ditch the mantra that arbitration is simply a mirror of
litigation, when if you look around you can arbitrate in
a week, a month, 100 days paying the arbitrator hardly
more than the court fees involved in taking the same
case to trial in a year. Why say adjudication in 28 days
can only apply to construction, when you can agree to
use adjudication for anything. Ask an electrical expert
to opine on an electrical problem, and avoid suggesting
that mediation should be used at a time when the costs/
benefit ratio has gone awry.
When clients come through the door we need to
understand their interests better and manage their
expectations, and need perhaps to become effective
resolution managers without being overly adversarial
and positional, pushing the parties further apart. How
very rare it is to see opposing lawyers and their clients
sitting around a table, admitting they have a problem
and agreeing how best to sort that problem out.
More cooperation in designing the most appropriate
resolution process will probably please the client and
lead to more work.
Times are hard and margins are squeezed; but doing
right by your client must come first. So in 2013 think
outside the box and advise appropriately.
Anthony Glaister, mediator, arbitrator, adjudicator and
construction claims consultant. www.mediate.co.uk
04071 Modern Law Magazine Advert v 2.indd 1 30/11/2012 14:44

60
Q: Will commoditisation kill off specialism in legal
entities and what impact will this have?
Commoditisation: a
A: buzz word striking
fear into the heart of
many personal injury
(PI) lawyers for whom
the main challenge, right
now, is securing enough
new work in a seismically
changing legal world.
A simple calculation
shows that for low value
work we will be doing
twice as much for half
the money and that’s
before we factor in the
effects of an increase
in the small claims limit!
Commoditisation and
securing a larger share of the volume market would appear
to be the only option.
The alternative is to take up a niche position based on
specialist and higher value work won by a reputation for
excellence and expertise. I firmly believe there will always
be clients in need of this type of practice and specialist
advice. Commoditisation implies ‘one size fits all’ and that
certainly isn’t true in high-value complex PI and medical
negligence cases.
Capturing time on the go
Eclipse Legal Systems,
the sector’s largest
independent software
solutions provider,
has announced the
impending release of a
mobile time recording
application.
The application -
currently codenamed
MyTime - will provide
mobile time recording for users of Eclipse’s Proclaim Case
and Practice Management solutions. MyTime is designed to
cater for all popular devices including Apple (iOS), Android,
Blackberry and Windows Mobile.
A real-time (or on-demand / ‘push’) sync means that
recorded time elements can be posted to the relevant
Proclaim area for analysis and confirmation (MyTime will
also include a client and matter lookup feature). All time
ML // January 2013
Business Section
So far, this approach is working for us, but it’s not every
practice’s preferred option. I have daily approaches
from CMCs looking to place clients as their existing
solicitors have stopped referring work in readiness for
either switching their priorities or exiting the market.
Further evidence is the response to www.webuyanyfiles.
com which we established in 2011 to buy caseloads and
practices as part of our growth strategy. Two years ago,
we had to go out of our way to stimulate interest. Now
we are now fielding 12-15 enquiries a week from practices
looking to cash in on the value of their personal injury
work, some to concentrate on other areas of specialism.
Those most at risk from commoditisation are the large
number of smaller practices (and some bigger ones
too!) characterised by a flat line traditional partnership
structure, cash flow strangulation and a generalist
approach to law. For firms which either can’t or won’t
invest significantly in one particular area of practice,
consolidation, take-over or even closure seem inevitable.
In short, it’s a choice between quality and quantity and
there is a future for specialist niche firms which stand or
fall on their results and the care they take of their clients.
Neil Hudgell, Managing Director, Neil Hudgell Solicitors.
Neil is a member of the Law Society Personal Injury Panel,
the Association of Personal Injury Lawyers and the Brain
Injury Group.
and narrative entries will update the relevant matters,
WIP and billing details across areas of the user’s own
Proclaim solution.
Steve Ough, Chief Software Architect at Eclipse, said: “This is
an important development, furthering our ethos of providing
device-independent, mobile productivity applications to
complement Proclaim. We have opted to design MyTime inhouse,
from scratch, to provide the very best fit for our users
in terms of tapping in to Proclaim’s rich feature set.
“We are seeing more and more clients come to us
requesting applications and features that require an
‘any time, any place’ architecture. Not only do these
applications need to be platform-agnostic, but they need to
be location-agnostic too. We feel that the type of remote
access to core enterprise software feature sets that this
application (and the forthcoming TouchPoint) offers is very
much the future of legal IT solutions.”
www.eclipselegal.co.uk

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62
Layering up
As innovators prepare for the April reforms, Phil Bellamy outlines his predictions
for change in the After-The-Event (ATE) insurance sector, mainly group coinsurance
or layering underwriters to help the legal sector overcome times of
litigation and profit adversity.
is set to become a
2013 very challenging year
for both solicitors and ATE insurers
alike. The lack of clear guidance on
the implementation of LASPO and
in particular the ban on referral fees
and Qualified One Way Cost Shifting
(QOCS) has made it extremely
difficult to predict the future let alone
prepare for it.
Leaving aside whether firms will be
financially able to run PI cases in the
wake of the ban on referral fees, the
potential drop in fixed fees in the RTA portal and the proposed rise in
the small claims court limit for RTA PI cases - what is the future of the
ATE market?
With average motor injury disbursements, of up to £400 each pre
issue, a case failure or abandonment rate in excess of 13% and the fact
that Part 36 trumps QOCS protection, DAS firmly believes there will
be a demand for some form of ATE insurance.
The potential for Part 36 claims to wipe out all of a successful
claimant award - historic Part 36 claims range from £125 right up to
£100,000 - means that claimants and their solicitors will demand
protection for these risks. An ATE insurance market will survive, albeit
a much leaner one.
“Going forward, once another one or two
big losses have hit the headlines i predict that
insurance will be secured through a group of
ate insurers, each writing up to £1m or so in
order to spread their risk and reduce volatility
as much as possible.”
DAS is committed to staying in the ATE market and despite the
uncertainty has a number of solutions under development. One
form of these ‘lite’ solutions may take the shape of a traditional ATE
insurance contract between the insurer and claimant but with the
lower insurance premiums being paid out of a claimant’s damages in
successful cases - following the abolition of recoverability.
So the Government might succeed in bringing the number of
claims down but for whose benefit? Certainly not the voting public
who, post April, will face the prospect of potentially paying for legal
representation, disbursements, ATE insurance and adverse costs out
of any damages they receive.
The funding market is also set for a few changes post Jackson. I
think there are similarities between the fledgling ATE funding market
and the ATE insurance market of some 10-15 years ago. The industry
has had one of the biggest losses suffered by a funder and its ATE
insurers since the market really began to take off: the Innovator One
ML // January 2013
Business Section
case. This £10m loss, although painful at the time,
will ultimately be good news for ATE insurers in
the medium to long term.
Although DAS currently has limited exposure
to funded litigation insurance we have been
keeping a close eye on market developments
over the years; funding company announcements
and results in particular.
Up until this loss, there was the appearance
that litigation funding was a safe bet. Funding
company results and corporate updates would be
issued every three to six months, with a similar,
positive upbeat message from most parties.
However, any underwriter who has been in the
game for a decade or so will know all too well
that these results were unlikely to continue.
History has taught us that anybody can make
profits in the early years as the easy cases settle,
premiums and funding multiples are received
and cash flow is good. Even cases that are
abandoned or lose at trial will not cost that
much in the early years and can be absorbed by
previous income.
However, the honeymoon period eventually
ended for early ATE insurers, somewhere
between the fifth, sixth or seventh year of
trading, when significant losses from failed trials
far exceeded the premium income from previous
winners. The £10m Innovator loss will not be the
last, nor will it be the biggest.
I can accept that funded cases are more
robustly vetted than standard ATE litigation, with
QC’s opinions and an alignment of interest from
all parties.
However, where funders see a prospect of
success figure of 60%, underwriters see it as a
risk of failure of 40% - a significant possibility of
loss and usually a total loss.
Going forward, once another one or two
big losses have hit the headlines I predict that
insurance will be secured through a group of ATE
insurers, each writing up to £1m or so in order to
spread their risk and reduce volatility as much as
possible.
This method of group co-insurance or layering
will be assisted by an increase in capacity from
the ATE market as more insurers seek to diversify
their book with funded litigation insurance. The
ATE market has a history of overcoming adversity
and DAS is confident that access to justice can
prevail.
Phil Bellamy is ATE & Special Risks Manager at
DAS Group Underwriting.

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