Michael Napier

The Business of LawNovember 2012 | Issue 3 | ISSN 2050-5744Dominic Regan begs lawyers to budget in the multitrack, avoiding the ‘frightener’ of recent judgementsSector Roundtable: MLM gathered experts,regulators and champions of the conveyancingsector to find out what’s affecting the market, whohas the advantage and how to maintain successMan on a mission: Antony Smith interviews MitchKowalski on his latest book that’s causing a stiracross the globe and onlineModern Law Magazine | November 2012 | Issue 3 Charlton GrantSupported by“People are generallyfrightened of lawyers andfeel they can’t get accessto justice if they’ve beentreated wrongly. This isdue to a fear of the cost oflegal services – too oftenpresented to customerswith language they don’tunderstand”David Edmonds, LSBMichael Napier“We must not forget the purpose behind reform; that clients needto be put first by the legal profession. If this results in a morecompetitive marketplace then this can only be good for the client”Michael NapierSponsored byPL C

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Introduction 03Modern Law ConferenceABS – One Year on - The New Legal Frontiers27th March 2013The Royal College of Surgeons, LondonEARLYBIRDTICKETS£130WelcomeIt’s been just over a year since Alternative BusinessStructures were given the green light for licenceapplications. Yet some believe we won’t see realinnovation until April 2013 - the next predicted ‘bigbang’. A view David Edmonds, Chair of the LegalServices Board agrees with (see pages 11-12).However, there has been some ABS impact todate: it has motivated existing, traditional and highstreet firms to reassess their value to the market,how they can meet clients’ needs and deliver inthe future. That’s the view of specialists attendingthe first Modern Law Sector Roundtable which inthis issue focuses on the conveyancing sector (seepages 37-39). Our guests told me it’s imperativefor representative discussions to take place outsideof consultation. The lack of opportunity to do thisis mainly due to hectic schedules so I’d like to takethe opportunity to thank all those involved and thehospitality of Goldsmith Williams.Never has there been a more pivotal year of change inthe delivery of legal services. It seems essential thenfor us to invite the first ABS movers to an interactivearena and share their experiences. The first MODERNLAW CONFERENCE : ABS – One Year On – The NewLegal Frontiers – is the platform for those who haverapidly embraced change through a fascinating varietyof new structures and innovative alliances. It combinesthe experiences of those leading the business of lawwith feedback from the regulators and expert opinion.We’re lucky enough to have captured the imaginationof Michael Napier, a consultant (and formerlyChairman of Irwin Mitchell Holdings Ltd), who willchair the unique and timely event in March 2013. Irecently had the pleasure of tapping into Michael’sunlimited ABS and legal growth knowledge (see page14-16) and I’m looking forward to welcoming him tothe stage next year.The MODERN LAW CONFERENCE : ABS – One YearOn – The New Legal Frontiers - will be held at theRoyal College of Surgeons, London on the 27 March2013. For further information on the conference pleasevisit www.modernlawmagazine.com.Modern Law is the place to share in an excitingnew era...Emma Waddingham, Chief EditorModern Law Magazine Issue 3 – November 2012 | ISSN 2050-5744Chief EditorEmma WaddinghamEditorial DepartmentAntony SmithStan NealProductionLindsey Thomson-HeleyDesignRichard BerryEvents ManagerJulia ToddEvents Co-ordinatorCharlotte ParkinsonContact t: 01765 600909 or e: info@modernlawmagazine.comPublisherKate McKittrickAdvertisingRachael PearsonModern Law Magazine is publishedby Charlton Grant Ltd ©2012.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 collatedfrom 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 wascorrect 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 errorsor omissions result from negligence, accident, or any other cause.ML // November 2012

04ContentsCONTENTS0703-09 Intro & THE News07 Dominic talks newsDominic Regan begs lawyers to budgetin the multi track, avoiding the ‘frightener’of recent judgements and landing in chillywaters before the judiciary.11-16 The INTERVIEWS11 Interview with... David EdmondsEmma Waddingham speaks to the Chairof the Legal Services Board as he callsfor regulators to cut detail to the quick toensure consistency and high standardsfrom all bodies - ultimately deliveringvariety and choice for consumers.14 Interview with... Mike NapierEmma Waddingham speaks to theformer Irwin Mitchell Chairman turnedconsultant on the real impacts ofexternal funding and the fast pace ofchange in the legal sector19-33 The views20 Track changes: ethicsChris Kenny, Legal Services Board20 High on the agenda:PC RenewalsRichard Collins, SolicitorsRegulation Authority21 Delivering an InvestmentReady entitySteven Arundale, RBS & Natwest21 Inspired reactions: LeO’sList of ShameJo Hodges, Redbrick Solutions22 Work readyNoel Inge, ILEX Tutorial College22 Outsourced for successRobert Parness, Paramount Legal Costs23 Bind experience with advice toavoid LeO’s list...Angela Moores, Jarvis Family Law23 Transparency is nothing to fearDavid Bott, Bott & Co.24 Bolstering the armouryEddie Goldsmith,Goldsmith Williams24 It’s not the IT, it’s the cultureCharles Christian, The Orange Rag25 Risk profiles a priorityMartin Ellis, Prime Risk Solutions25 LeO: the List of Shame realitiesChris Owen, St Philips Chambers27 The Risk RegisterJaunita Gobby, Legal Eye1121Editorial ColumnistsAlan NesbitManaging PartnerNesbit Law GroupAndrew StenningManaging DirectorSearches UKAngela MoorePartner JarvisFamily LawAllan CartonManaging DirectorInPracticeAntony SmithDirectorLegal Project ManagementBarry TalbotManaging DirectorInformance LimitedCharles ChristianEditor in ChiefThe Orange RagChris KennyChief ExecutiveLegal Services BoardChris OwenCEOSt Philips ChambersDavid BottManaging PartnerBott & CoProfessor Dominic ReganLegal commentator, trainerand costs expertEddie GoldsmithPartnerGoldsmith WilliamsGuy HewetsonPartnerHewetson ShahIan HunterManaging DirectorJellyfishJaunita GobbyDirectorLegal EyeLorraine HarrisonSolicitorRalli SolicitorsMartin EllisManaging DirectorPrime Risk SolutionsMatthew WilliamsHead of AmTrust LawAmTrust Financial Services.Neil IngeManaging DirectorILEX Tutorial CollegeNick HodgesManaging DirectorOyez Professional ServicesRob HailstoneBold Legal GroupRobert ParnessCosts LawyerParamount Legal CostsSean GordonSenior SolicitorNeil Hudgell SolicitorsSteven ArundaleHead of ProfessionalsSectors, CommercialBankingRBS & NatwestBernard GeorgeDirectorSocrates TrainingDavid McNamaraManaging DirectorSOS LegalJo HodgesManaging DirectorRedbrick SolutionsRichard CollinsExecutive DirectorSolicitors Regulation AuthorityML // November 2012

Contents0527 Identify, target, complyBernard George, Socrates Training29 Keeping up with the changesAndrew Stenning, Searches UK29 LeO: is this the best we can work to?Lorraine Harrison, Ralli31 Change or get left behindAllan Carton, In practice31 Revolutionising the Bar: do or dieGuy Hewetson, Hewetson Shah33 ATE, still on the agenda: implicationsfor commercial casesMatthew Williams, AmTrustFinancial Services33 Overhaul to comeRob Hailstone, Bold Legal Group37-51 The Features37 Sector Roundtable: ConveyancingMLM hosts a roundtable of experts,regulators and champions of theconveyancing sector to find out what’saffecting the market now, who has theadvantage and what is needed of thesector and of regulators for that light atthe end of the tunnel.41 Great ExpectationsIn the conveyancing process, clients’expectations of flood risk investigations‘as standard’ are misaligned, despiteinsurance risks and change set for 2013,as David Mole reports.43 Referral fee ban: Titanic disaster?The orthodox view is that the ban will befor the worse. Optimists may find helpfulguidance for the future by looking to thepast, as Tony Walton suggests.45 People firstABSs and the shift from input to outcomesin regulation has had a resounding impacton personal development plans. ModernLaw offers some practical guidance.47 Best in breedKey to the ABS model is to be best inbreed for clients through the consistentdelivery of high quality and client-focusedservices. Mr. Bippon Vinayak outlines howthe medical and rehabilitation solutions forPI ABSs are integral to this strategic vision.48 A case of tortoise v hareIt’s been 12 months since the introductionof Alternative Business Structures (ABSs)by the Legal Services Act 2007. Sowhat impact has this had on partnershipstructures? Eimear McCartan reports.49 Get in syncAntony Smith sheds light on LawSync – ascheme by academic institutions to delivercommercialised and work-ready graduatesinto a reformed legal services sector.51-62 BUSiNESS MANAGEMENT52 Innovative DeliveryEmma Waddingham hosts a quickfireround with those pushing the boundariesof ABS software forwards.53 Take a scythe to non-billable hoursAnthony Smith, Legal Project Management54 Holding lawyers to account, poorlySean Gordon, Neil Hudgell Solicitors54 Underpin business processesto successDavid McNamara, SOS Legal55 Act before it’s an issueBarry Talbot, Informance55 Create a robust system or add toyour problemsAlan Nesbit, Nesbit Law56 Complaints & avoiding mistrust(Ian Hunter, Jellyfish)57 The Bar: focus on client experienceCatherine Bailey, Bar Marketing57 New era in client-centric legal servicesEclipse Legal58 Man on a missionA mission nothing less than tofundamentally change the way law firmspractice. Antony Smith interviews MitchKowalski on his latest book that’s causinga stir across the globe and online.60 Designs on a tribeModern Law looks at how the new legallandscape and the rise of the ABS will seemore firms build a tribe of outsourcedsuppliers to gain a commercial edge.62 Compulsion to mediateAnthony Glaister MCIArb62 Are changes creating newprocurement andoutsourcing models?Nick Hodges, Oyez Professional Services415258ML // November 2012

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Dom Regan News 07Dom Regan newsBudget, don’t bodge itProfessor Dominic Regan begs lawyers to budget in the multi track, avoiding the ‘frightener’ ofrecent judgements and landing in chilly waters before the judiciary.The requirement to preparelitigation budgets and seek courtapproval for them is a massivedevelopment coming to most multitrackcases issued from 1 st April 2013.Indeed, two recent decisions meanthat budgeting, which is described indetail below, will have more dramaticconsequences than Lord JusticeJackson anticipated.The frightener is Henry v MGN, 16thMay 2012, an early and ominous warningfor practitioners. It was a defamationaction and, as such, was caught by anearly budgeting pilot scheme.At the outset the claimant preparedan estimate of proposed litigationspending which the court approved.After winning at trial 10 months laterthe claimant submitted a bill whichwas 18 times higher than budgeted forwitness statements, and eight timeshigher for disclosure. The extra costswere nearly £300,000.Despite expressing the clearview that the additional spend wasjustified, the Senior Costs Judge heldthe claimant to the budget in terms.What is the point of a budget if oneis then going to ignore it? Leave toappeal has been granted. Incidentally,the assessment was of base costs. Itwould be no surprise if there was aconditional fee agreement in place, sothe lost costs in just this action wouldbe about £600,000. Ouch.In Safetynet Securities LTD vCoppage, 15th August 2012, HHJSimon Brown QC, the doyen of caseand costs management as we shallsee, decided that since the winningclaimant had come in on budget adetailed assessment was futile, and sohe ordered there and then that costsbe paid in 14 days.Whilst the case is on Bailil this aspectis not reported, but I have it from theLearned Judge himself, to come awayfrom trial with costs in the bag will dowonders for cashflow. The tidy disposal‘Within the Ministryof Justice is an evilmastermind. A partywhich fails to file abudget when obligedto do so will be takento have relinquished allclaims to costs apartfrom courtfees payable.’of all issues at the conclusion of a trialis desirable, admirable. This just goes toemphasise how vital it is to work longand hard so as to perfect the content ofthe estimate.Sir Rupert recommended budgetingfor he perceived that litigatorslaunched off without considering thenumbers. Where else, he asked me,would one embark upon a substantialproject without first determiningwhether the enterprise was viable?There is also the risk of optimism –we will win so what we spend we willrecoup – whereas almost invariablythere must be a loser.Budgeting will apply to multi-trackactions whether issued in the CountyCourt or in the High Court Chancery/ Queens Bench Division. Excludedare the Admiralty and CommercialCourts. One should remember thatthe Commercial Court overhauled it’sML // November 2012

08 Dom Regan NewsIf the costs do not exceed £25,000 then onegets off lightly and need only complete the firstpage of the precedent. Somewhere out there isa man who should be elevated to the status ofsaint for suggesting this to Sir Rupert’procedures four years ago in a mannercompatible with the thrust of theimminent, general Jackson reformswith tighter controls on the length ofspeeches and documents, for example,intended to curb excesses and makejustice achievable at proportionate cost.The purpose of costs managementis to enable the court to manageboth the steps to be taken and thecosts to be incurred by the parties soas to further the overriding objective.The prompt - proportionate disposalof dispute - is what underpins Part 1,the most important segment of theentire CPR.Unless the court orders otherwise,all parties (except self-representedlitigants) must both file and exchangebudgets within 28 days after serviceof any defence. Whilst the court candirect that budgets need not beserved in a particular matter I considerthat few such exceptions will be made.I was fortunate enough to be presentat the publication of the final Jacksonreport and what struck me then andstays with me was the passionatesupport for it voiced by the LordChief Justice and the then Master ofthe Rolls who has now, rightly, beenappointed to head the Supreme Court.The judicial muscle backing RupertJackson is formidable.Precedent H is the normal form tocomplete. If the costs do not exceed£25,000 then one gets off lightly andneed only complete the first page ofthe precedent. Somewhere out there isa man who should be elevated to thestatus of Saint for suggesting this toSir Rupert (although I would be happywith a large cheque).If the estimate exceeds £25,000then the full form must be completed.In essence, the form seeks two criticalpieces of information. One is requiredto identify the team that will workon the matter with relevant chargingrates specified. The second elementis a breakdown of the work to beperformed, be it on disclosure, witnessstatements or whatever. Thus, one cansee the proposed expenditure intendedfor each and every aspect of the claim.Since they could not quite affordLord Sumption at £8,000,000,Lord Neuberger MR and Sir Rupertkindly asked me (£0) to monitorthe Birmingham Mercantile Courtcosts pilot scheme ,run by HisHonour Judge Simon Brown QC. Thisembittered cynic was captivated bythe effectiveness of the process andreported accordingly. Having heardone barrister sneer at the very idea ofbudgeting – ‘who knows what it willcost?’ - I was smitten by the simplicityand efficacy of the process.The Judge was charming yet surgicalin his approach: “Case managementis costs management and vice–versa,”was what he said to me as we enteredcourt for the first time. It was chilling tosee how some lawyers had not thoughtthings through.An inheritance claim worth£250,000 generated costs estimatesof like amount. “You do realise, don’tyou, that if this goes to trial there willbe nothing left?” asked the Judge.The advocates nodded yes but theirfaces contradicted the body language.That grenade triggered mediation andan early settlement. As an aside - thebenefit of an informed outsider - theJudge stepping back and taking apragmatic view was incalculable.The typical hearing in Birminghamlasted about 45 minutes. This does notpermit an intricate preliminary detailedassessment to occur. Rather, the Judgewas on the alert for any element ofexpenditure which stood out as extremeor extravagant. He would compare andcontrast the respective spend and seekan explanation as to discrepancies.The aim of the court is to approvea budget, and the impact of thatis to be seen from the Henry andSecuritynet decision which I describedabove. If the court thinks the spendA fewpractical tipsAbove all else, talk to youropponent(s) before going nearthe estimate. You need to considerwhat the issues are, and then howbest they can be resolved. This willshape disclosure and evidence, layand expert. Electronic disclosureis growing in importance so reflectupon whether it might assist inthis dispute. If you are lookingto involve expensive expertsyou ought to consider seekingtenders. Let them pitch for andgive quotations. No one in theBirmingham court considered this,apart from the Judge.Getting a sound budget in placerequires collaboration between theperson running the matter and theircosts lawyer, internal or external. Iurge everyone to start thinking nowabout this new duty to budget.One must have in place systems topromptly identify when and wherea budget might be breached. It ispermissible to go back to courtand seek leave to revise a budget.That might have helped thehapless claimants in Henry.There are of course someindividuals with an anarchictendency, who might decidethat filling in the budget formis a tedious chore that mightbring on the vapours and so theywill ignore it. Bad news. Withinthe Ministry of Justice is an evilmastermind. A party which failsto file a budget when obligedto do so will be taken to haverelinquished all claims to costsapart from court fees payable. Ihave a subtle sixth sense whichtells me that an awful lot ofpractitioners will complete thepesky form. And it shall be verifiedby a statement of truth signed bya senior legal representative.Be afraid...improper it will decline to approve,which is the clearest warning sign of atroubled outcome and an aggressiveassessment if that party succeeds.Professor Dominic Reganwww.profdominicregan.blogspot.comML // November 2012

Interview 11Interview with...David EdmondsChair, Legal Services BoardQIt’s been a year since the ABS model was firstintroduced as an option for the legal sector. Whatbenefits have ABSs and other new legal entitiesbrought to the legal market?AWe’re looking at a world changing on a faster timescale than people expected – not quite the ‘big bang’moment but there’s time yet. The legal landscape isnow fundamentally transformational in that there are nationalbrands for the first time - with the likes of the Co-op gainingABS status as well as potentially the AA, Direct Line andSaga making applications for licences. For consumers theseare trusted, well-known brands with legal advice offeringsthat are of a different kind to the ones they’ve had before.The guarantee of fixed / agreed prices may remove some ofthe anxiety for customers too. Research shows that peopleare nervous about going to lawyers and concern over price ispart of the problem. ABSs provide variety and new offeringsfor legal services. However the introduction of ABSs hasalso led to – and will lead to further - innovation on the highstreet (i.e. will drafting for a set price). This has the potentialto flourish once the high street firms work out how best torespond to the competition. Traditional law firms will haveto look at life in a different way. The Quality Solicitors brandis a prime example of high street innovation and lookingbeyond the solicitor shop window to attract work. QualitySolicitors has linked with other high street companies (WHSmith) to give those in the network a different dynamic inthe marketplace and reach people in new ways.‘It’s fair to say we do want to stimulatepro-activity amongst the regulators;the ‘fear’ of creating a competitiveregulator market ought to raise thelevel of quality across the board, ratherthan diminish standards and price’QThe optimology sector is often referred to as anindicator for how the legal high street market willlook like once the ABS licensing dust settles. Is thisa useful comparison?AOptimology has been totally transformed by threekey brands. There is still a high street offering forthose who want those services; for those who want toresponse in a niche marketplace, the opportunities are there.It will be the same for the legal sector; solicitors will see theopportunity once they have worked out their niche or USP.David EdmondsChair, Legal Services BoardDavid Edmonds was appointed as the inauguralChairman of the Legal Services Board (LSB) in 2008by the Lord Chancellor and Justice Secretary, afterconsultation with the Lord Chief Justice.David has extensive experience of senior teamsin commercial and public sector organisations, inboth Chair and Chief Executive roles. After a careerin the senior civil service and as Chief Executiveof the Housing Corporation, he spent seven yearsas a Managing Director within the NatWest Group.David’s regulatory experience includes five years asDirector General of Telecommunications for the UnitedKingdom, and two years as a founding member ofthe Board of Ofcom. He was the Chair of the Board ofNHS Direct from 2003-2008. He was a Commissionerat the Legal Services Commission for four years. Hewas also Chairman of Wincanton PLC from August2008 to December 2011. David is Chairman of NHSShared Business Services Ltd and a non-executivedirector of several PLCs as well as the London LegacyDevelopment Corporation. David has recently beenappointed as non executive member of the board ofBarchester Homes.ML // November 2012

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14 InterviewInterview with...Michael NapierMichael Napier, one of the industry’s most highly regarded thought-leader oncosts policy and the business of law, spoke to Emma Waddingham about histhoughts on the fast-paced changes to legal services. Since stepping down asChairman of Irwin Mitchell Holdings Ltd he is a consultant to those in the sectorlooking to embrace change and explore opportunities for growth internally andwith investors and funders.QAre there opportunities for realgrowth in 2013 onwards or willreform (especially costs) createthe need to sustain rather than grow?AEven in a recession there arealways opportunities for growthin well run law firms and recentlypublished results show that many ofthe major firms reported respectablesingle digit growth last year.Butfrom next April the costs reforms arecertain to pose growth challenges forlitigation firms.So it would be quitewrong to generalise that these aregood times for all lawyers.Many firmswill want to concentrate managementtime on sustaining their bottom linefirst, pursuing growth a close second.Exploring opportunities in the new ABSworld will naturally be core activity forentrepreneurial firms but the priorityfocus should be to concentrate onwhat lawyers know best – the law andserving their clients well - which is notrocket science.QIs leadership undervalued oroverlooked in the current legalprofession?ALeadership is not part of legaltraining so its importance caneasily be overlooked. Somelawyers have leadership qualities asa natural part of their DNA. Othersare best left to concentrate on thelaw and the client.And some cancombine being a good lawyer with theskills of leadership and management.The Clementi report recognised thattoday non lawyer managers play acrucial role in the efficient running ofsuccessful firms. Hence the adventof the LDP,now superseded by theABS, providing encouragement to nonlawyers to bring financial,marketingand other management skills to legalbusinesses with the incentive ofsharing in the profits.QShould law firms look to therest of the private sector forleaders and managers, ratherthan rely on Partners / technicians toassume the role?AIn the modern business oflaw the traditional partnershipmodel is under strain,somewould even say out dated. Now that wehave crossed the Rubicon of lawyersbeing permitted to share profits withnon lawyers its a natural progression tolook beyond the partners and to bringin the skills of non lawyer managers,and possibly to combine with investorswho will only be prepared to risk theircash in legal businesses that are wellled and managed.QWhat makes a great leader /manager?ALaw is a people business– even corporate law. Andleaders of law firms need toremember that they are also runningpeople businesses where the culturethat runs through the partnership andthe staff is central to success.Trust inthe people at the top is paramountand takes time to earn.The CEOwhose task is to maintain profitabilityand cut overheads requires buy infrom everyone in the business andwill not get it unless a clear vision ofwhere the firm is going is regularlycommunicated to all.QWhy is the legal sector anattractive opportunity forinvestors, such as the privateequity houses - particularly as somelawyers are feeling less positive abouttheir own sector?AThe early signs are that externalinvestment in ABSs that want togo down the investment route( not all do ) is already attracting theinterest of private equity houses andother investors.That is no real surpriseand the pace is likely to quicken as moreABS licences are granted.The attractionto investors is that successful legalbusinesses have healthy profit marginsand generate cash that is a positivein today’s economic environment.Private equity is always interested ina new sector that is deregulated andlikely to consolidate which is what ishappening now to the supply of legalservices.And law firms shouldn’t worryabout the traditional fear that all privateequity investors simply want to get infor a short while,sell and then get out.Aprivate equity investor will not onlybring capital funding but will also bringmanagement focus to grow the businesssteadily,possibly leading to an IPO orto a subsequent sale to another privateequity investor or even a trade sale toanother firm.QHow slick are law firms atmarketing, capturing workand building competitiveUSPs (or will they all rely on price).Will investment help with marketingpotential?ASuccessful law firmsare particularly good atmarketing and businessML // November 2012

Interview15‘We must not forget the purpose behind reform; that clients need to be putfirst by the legal profession. If this results in a more competitive marketplacethen this can only be good for the client’development,especially in thepersonal injury area which ishighly competitive and willbecome even more so whenreferral fees are banned nextApril.Personal injury firms knowthat they have to compete tostand still let alone grow andbecause marketing legal servicesis very expensive this is an arearipe for external investment tohelp pay the bills.QIs client experience a realpriority to the processingof legal services?AClient experience andsatisfaction is thetop priority. In a B2Bsituation client relationshipmanagement ( CRM ) is key. Allclients,individuals,SMEs or largecorporates are consumers oflegal services. The title of theGovernment white paper thatheralded the Legal Services Actwas “ Putting Consumers First “.All firms need to remember that.If you don’t look after your clientsin the manner they expect todaythey will go somewhere else.QShould wider investment(such as external funding)be used to improve clientservices / processes and crosssellingtechniques?AEach ABS that decides totake in external investmentwill have its own prioritiesfor using the extra capital that willbe available. But the voraciousappetite of IT is always going tobe high on the list of how goodbusinesses can improve theirsystems to serve their clientsbetter - and that doesn’t onlyapply to volume or so calledcommoditised services.On thewider scale of things the singlemost important factor for firmsto confront in the new ABS worldis how to compete on a levelplaying field. By that I don’t justmean a level regulatory playingfield because the regulatorswill ensure that the externalcommercial organisations ( forexample Co-op and Direct Line) that are entering the supplyof legal services via the ABSroute are also covered.It is thefinancial playing field that is outof balance.Law firms simply don’tpossess as much capital muscleas the external competition forexample to merge with or acquirecompetitor businesses.Thesolution to redress this imbalanceis for law firms to take in externalinvestment that will allow them tocompete financially.This dynamicis similar to the external thirdparty investor who creates a levelcosts playing field by investingfunds in support of a case inreturn for a share of the damagesif the litigation is successfulQWhat will be the directresult of the LegalServices Act?AThe LSA was passedfive years ago and onlynow are we seeing directevidence of the the arrival ofABSs on the legal scene amidactivity that is bringing rapidchange to the supply of legalservices to consumers. We mustnot forget that purpose behindthe reform;that clients need to beput first by the legal profession.Ifthis results in a more competitivemarket place then this can onlybe good for the client.Now working with the likes ofHabour Litigation Funding (seepage 16), Michael is also goingto chair the MODERN LAWCONFERENCE : ABS – One YearOn – The New Legal Frontiers, on27 March 2013 at the Royal Collegeof Surgeons, London. For details,please visitwww.modernlawevents.co.ukMichael NapierHighly regarded for his role as a practitionerin many landmark cases, Michael Napier isprobably best known for his transformationof Irwin Mitchell during 30 years as seniorpartner. A progressive thinker and strategist,he has influenced many reforms in the civiljustice system as well as the fundamentalchanges now taking place in the legalmarket. He worked on the implementationof Conditional Fee Agreements and hasbeen involved in the development of policyrelating to litigation funding since 2005. Hehas also written extensively on fundingoptions and access to justice.Michael was voted ‘Lawyer of the Year’ inthe Legal Business Awards 2012 for his workat Irwin Mitchell, helping it develop ‘froma small Sheffield practice to the nationalpowerhouse it is today, on the brink ofbecoming a pioneering ABS firm’.Since his Presidency of the Law Societyin 2001, Michael has been the Attorney-General’s pro bono envoy and havingrecently stood down as Chairman of IrwinMitchell Holdings Ltd he is now a freelanceconsultant.www.michaelnapier.comML // November 2012

16 InterviewWhat Michael did next…Having moved into a specialistconsultancy role after steppingdown as Chairman of Irwin Mitchell,Michael recently announced his latestrole with Habour Litigation Funding.Michael has joined HarbourLitigation Funding’s investmentand advisory team as a consultantto support the company’s growthstrategy. He is also there to helpconsolidate it’s pioneering positionin the UK funding market.As well as offering his significantexperience on costs policymatters (including damage basedagreements), while assisting theinvestment team in it’s review ofcases for funding.“Harbour is at the forefront ofthird party litigation funding whichis now a well-established andincreasingly important route forsolicitors and their clients. So, withmassive changes to the funding ofaccess to justice only months away,I’m happy to become a consultant tothe Harbour team at this crucial timefor responding to the funding needsof litigants,” outlines Michael.The reason for using Michael,says Susan Dunn, Head of LitigationFunding at Harbour, is to access a“brilliant and influential legal mindwho shares Harbour’s views on theaccess to justice that funding canbring to cases”.Brett Carron, Harbour’s ChiefExecutive adds that Michael “hasan ability to see through barriersand develop new markets andopportunities” and will “help Harbourdevelop further as a market leaderand innovator in litigation funding.”The Harbour investment andSusan DunnHead of LitigationFunding, HarbourBrett CarronHarbour’s ChiefExecutiveadvisory team already includesformer High Court Judge Sir GavinLightman, former London Wragge& Co managing partner NicolaMumford, and leading insolvencybarrister Stephen Davies QC. TheHarbour team features StephenO’Dowd who joined from BT, andJohn Kingston, ex-head of litigationat Travers Smith.‘Michael has an ability to see through barriers and develop new markets and opportunities,and will help Harbour develop further as a market leader and innovator in litigation funding’Understand Development Risk.Unlock Hidden Value.Protect your house-buying clients frommaking a life-changing mistake –or missing a golden opportunity!Our unique search reports will reveal if a property is either atrisk from future nearby development, or if there are potentialfinancial gains to be had. An amazing 85% of our searchesuncover one or the other.They’re as near as you’ll get to seeing into the future!For more information on all of our productsvisit our website www.dev-assist.co.uk‘‘Information is power.So why would any conveyancingsolicitor not offer their client theopportunity to learn about whatthe future may hold in termsof any possible developmentthreat or opportunity?‘‘Martin Edwards – Planning Barrister & Commentator

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The views 1919-33TheViewsML // November 2012

20The viewsHigh on the agenda:PC RenewalsEnsuring that the 2012 round ofPractising Certificate renewalsis a more reliable experience thanlast year’s has been at the top ofthe SRA’s agenda. We recognisethat the last renewals round wasnot acceptable and since then wehave undertaken significant workto enhance the system and theuser experience.The planned enhancements have been implementedand we are confident that the system is now stable. Byengaging with a large number of representatives, fromsole practitioners to those working in large global firms,we have listened to the views of those we regulate andused this feedback to decide how best to reshape thesystem in a way that is practical for all branches of theregulated community.Because of time constraints, it has not been possibleto include all the changes that we would have liked thisyear, but with the help of those we regulate, we haveprioritised the issues to ensure we addressed those thatmattered most. These include:• Making applications simpler and easier to complete.This includes an overhaul of the flow and wording ofquestions and related guidance text• Making it possible for organisational contacts in eachfirm to process the bulk applications on behalf ofcolleagues, giving firms greater control over the waythey complete the PC renewal exercise• Enabling one-click ‘record complete’, allowingmultiple records to be confirmed as correct duringbulk renewal applications• Improved searching and sorting of an individual’srecords to make viewing and editing easier• Increasing the support available within our ContactCentre so that queries can be answered more promptly.We have been communicating extensively with allfirms and individuals to ensure those we regulate areaware of the changes and know how to process theirapplications. We believe we have a system that willmake the 2012 renewals process more streamlinedand efficient. This does not mean it is perfect. We willcontinue to improve our online systems and to movemore application services online during 2013.PC renewals will commence on 1 November and closeon 14 December 2012. This will give firms two weekslonger than the traditional one-month period allowedfor completion of renewal applications, to assist firms inscheduling the process.Full details of the renewals exercise can be found on ourwebsite @ www.sra.org.uk/mysra/services/renewal.pageBy Richard Collins, Executive Director, SolicitorsRegulation Authority (SRA) www.sra.org.ukTrack changes:EthicsOne of the many myths aroundAlternative Business Structures isthat they aren’t necessarily going tolead to a decline in ethical standards.Those consumers swindled in theminers’ compensation scandal mightbe forgiven for thinking that the statusquo couldn’t get worse. But, of course,that’s no more the experience of thevast majority of legal consumers than it is the experience ofthe consumers in the wider economy. Strong business andprofessional ethics have to be at the heart of any successfullong-term business, especially in legal services. They ensurethat the interests of customers, the legal system, andproviders are considered equally. This has ensured that legalservices in England and Wales are among the best in theworld and the first choice for international legal transactions.But how do we get beyond a picture of ethics which variesbetween Pollyanna at one extreme and the Big Bad Wolf atthe other?Whether the risks presented by change are real orimagined can only be monitored by considered, robustand independent research. In September 2012 the LSBpublished a report by Professor Richard Moorhead thatconsiders how it would be possible to benchmark and trackchanges in the ethics and behaviour of providers of legalservices. The model developed in the report analyses howthe character of those supplying legal services, the contextin which they work, and the capacities they have, interact toinfluence their behaviour.The report does not propose developing a simple l scoreor single number to represent a global view of how ethicalproviders are. But the approach would allow changes inethical norms to be tracked over a period of time throughanalysing responses to ethical concepts or scenarios.Benchmarking ethics is complicated both by therange of legal service providers and the complexity ofthe subject matter itself. Moorhead proposes a rangeof approaches to getting the information, ranging fromsurveys to individual interviews, to using the data thatregulators collect. Together a range of sources canprovide a rounded overall picture of change in the marketwhich could highlight emerging risks.Whether in the traditional professions, or in new businessesentering the market, understanding how attitudes andbehaviours change is vital. Behaviour in complying withregulation is driven by the principles and ethics of thosemanaging and supplying the services. Benchmarking is clearlycomplex, but we believe worthwhile. While we do not considerthat carrying out the benchmarking itself is necessarily the roleof the LSB, we hope that others will take the tools developedin this report and use them to monitor over time the attitudesof suppliers of legal services.For the full report, please visit:www.legalservicesboard.org.uk/what_we_do/Research/Publications/pdf/designing_ethics_indicators_for_legal_services_provision_lsb_report_sep_2012.pdfBy Chris Kenny, Chief Executive, Legal Services BoardML // November 2012

The views 21Delivering an InvestmentReady entityIn recent years I have readnumerous articles suggestingthat there was a long queueof Private Equity (PE) Housescarrying large wallets with anoverwhelming desire to investin legal firms. Whilst it is stillearly days in the evolution of theAlternative Business Structures(ABS), initial statistics would suggest that it may bemore challenging for PE Houses to achieve positiveinvestment decisions than originally anticipated.Having worked with many businesses over the last20 years, I have seen all too many fail in their pursuitof external investment. In terms of vision, strategy,product and delivery channel, many of those businessesthat failed were light years ahead of your standardtraditional legal practice. That is not to say that legalfirms can’t be attractive investment opportunities butmany simply don’t know how to present themselvesas an attractive proposition, for that is what they are –simply another proposition.If legal firms are truly serious about achievingambition through external investment then they needto present themselves in a way that makes them lookdifferent and attractive to the investor. Potentially thereare 4 key things for a firm to consider:Investors are attracted to capital value uplifts.Accordingly firms seeking investment must have avision, a strategy and a plan that will deliver short termimprovement in capital value. Capital values do not need tobe based on the here and now, they can be linked to futureopportunity and those firms who are exploring innovation,new markets, efficient delivery and profit maximisation arelikely to carry the highest level of attraction for investors.The business world is full of good people who haveshaped businesses to secure external investment.So why do lawyers think that they need to performthis task as well as delivering legal services? Thosefirms who employ relevant people with appropriateexperience and capability to secure external investmentwill stand a much better chance of being successful.Consider how external investors like to place theirinvestment. PE’s are far more comfortable working withLtd’s and PLC’s so in all probability conversion to thistype of business structure will give the firm a greaterchance of winning investment.Run your financial affairs as an investor would expectyou to run them. Look to develop Balance Sheet valueby retaining profits. Measure profitability in terms ofEarnings Before Interest Tax and Depreciation andAmortisation (EBITDA), and have a clear understandingas to how you deliver a return on equity.PE Houses and other external investors areaccustomed to investing in corporate style businesses.To carry maximum appeal legal firms need to lookcorporate, behave corporate and think corporate.By Steve Arundale, Head of Professionals Sectors,Commercial Banking RBS & NatWestQ: Will the ‘List of shame’ andforced powers by the LegalOmbudsman (LeO) raisestandards of customer servicework and focus their efforts toeffectively deal with complaintsin-house?After many years of waiting,A: delays, deliberations andconsternation the LeO has finallypublished a list of firms aboutwhom complaints have beenmade. Dubbed the ‘List of Shame’the names of 772 law firms thathave been the subject of a formaldecision by the LeO have been putinto the public domain. Rightly or wrongly it seems is adebate that will run for a while yet.Worth noting is that of 992 decisions made, remedieswere ordered in less than half, meaning the LeO wasactually satisfied with the law firms’ actions, customerservice and remedy offered in the majority of cases.I wonder whether Joe Public will be able to easilydiscern that being on the ‘List of Shame’ is notnecessarily a bad thing and whether those firms whowere deemed to have done no wrong yet still appear onthe list will have the marketing nous to turn the negativespin into a positive.A recent report by YouGov found that the mostcrucial part of the complaints process was the solicitors’initial response. A simple apology in plain English wasfound to do wonders in diffusing the situation and couldturn a negative consumer experience into a positiveone, making them far more likely to recommend thesolicitor.There are many things law firms can do to ensurethey provide a good customer experience. Robustcustomer service processes are essential and are madeeasier to implement if one person (or a team of people)own this responsibility. Most B2C organisations have acustomer services dept. Why not law firms?As we’ve seen above, the ability to deal withcomplaints efficiently and effectively has a huge impacton the outcome of the matter and the clients’ lastingimpression. There are numerous customer service andcomplaint handling courses available online, is it nottime solicitors were required to spend some of theirprofessional development quota learning to keep theirclients happy?A good case management system will reduce thenumber of complaints by ensuring matters are carriedout in a consistent, compliant manner. Initiativessuch as Lexcel and CQS also go a long way to givingconsumers the confidence that they are choosing areliable, trustworthy, quality solicitor. Better still; choosea case management solution that is Lexcel compliant!By Jo Hodges, Redbrick SolutionsML // November 2012

22The viewsWork readyCILEx’s qualifications havelong been accepted by manylegal services providers as themost effective training route fortechnician-level support staff, feeearners and lawyers.The great advantage of theCILEx qualification, which hasits roots in work-based learning,is that staff are learning how to do the job alongsidetheir studies. Employers can use the CILEx qualificationto ensure their staff are work-ready in the shortestpossible time.Take the example of an employer who recruits schoolleavers with good GCSEs and/or A levels. Using a CILExLevel 3 Certificate delivered by ITC’s supported distancelearning, these employees can be taught substantivelaw and practice in complementary disciplines such astort and civil litigation (there are eight certificates indifferent practice areas to choose from). They will alsoacquire professional skills, such as client care and legalresearch, all while continuously working in the office.This training, coupled with in-house mentoring andsupport, will produce a competent technician levelmember of staff in approximately one year. The payback,if not instantaneous, is rapid.Sponsoring employers can use the achievementof the paralegal Certificate, and the aptitude andcharacteristics displayed at work during this period ofstudy, to select staff members for higher-level trainingwho they know will benefit the organisation. Thisapproach is being adopted by many firms in favourof employing graduates with excellent academiccredentials and high salary expectations, but with noexperience of the working environment.There are options for preparing higher level stafftoo. The CILEx Graduate Fast-Track Diploma (GFTD)delivered through supported distance learning canbe used to train law graduates in complex matters oflaw and practice, as an alternative to recruiting LPCgraduates. This compact qualification leads to expertisein two legal practice areas and incorporates clientcare skills. Typically, a GFTD takes a year to completeand can be fitted around work duties when deliveredthrough ITC’s supported distance learning courses, sothe return on investment is usually very quick.At a time when training budgets are tight, it is moreimportant than ever to create a productive work-readyemployee as economically as possible.By Noel Inge, Managing Director, Tutorial CollegeQ: Outsourcing is being sold asa key part of success for highstreet firm sustainability. Why andwhere does outsourcing reallymake a difference?‘Horses for courses’, ‘theA: right tool for the rightjob,’ choose your metaphor;both business and legal processoutsourcing are on the increaseas law firms strive for commercialadvantage. In today’s competitiveworld it makes sense to employ aspecialist to deal with costs.The bottom line - that’s what business comes downto. More and more clients, particularly corporates,are looking to cut their legal services budgets, whichin turn puts pressure on law firms to reduce costs.That pressure is only going to increase as megalithicmultinational ABS’s begin to enter the legal servicesmarket.The benefits of instructing a Law Costs Draftsman,for example, can be summarised briefly as cost, qualityand objectivity. The rates charged by a Costs Draftsmanwill almost certainly be lower than those applicableto your fee earners, freeing your staff to do moreprofitable work and reducing the cost to your client.In terms of quality, a specialist Costs Draftsman willbe aware of the latest developments in the rapidlyevolving law of costs, and be able to advise you bothto be wary of certain aspects and to take advantage ofothers. Furthermore their experience permits the expertto deal with matters more quickly and, quite possibly, toachieve a better end result.In these days when claimants do not expect to payanything, what is obtained from the other party maybe all that the solicitor will make from a case. It is notunusual, therefore, that solicitors can become toopersonally involved in a matter once costs are the issue.Equally, where a paying client disputes his solicitor’sbill, the situation frequently becomes bitter and canspiral out of control so as to consume far more time andmoney than are warranted.A fresh pair of eyes or a new voice on the telephonewho does not have a history with the other party cansometimes move forward a case which has becomebogged down in acrimony.In short, outsourcing is a no-brainer, providing bothefficiency and preserving expertise excellence foryour client.By Rob Parness, Costs Lawyer, Paramount Legal Costs LtdML // November 2012

The views23Q: Will the Legal Ombudsman(LeO) ‘List of shame’ forcelawyers to raise standards ofcustomer service and focusefforts to effectively deal withcomplaints in-house?We all now have accessA: to the website for thelegal ombudsman www.legalombudsman.org.uk/aboutus/complaints which sets outamazing data about the natureof complainants, the sort of legaltransactions complained about andthe nature of complaints receivedand failure to follow instructions. But what does it mean?Firstly, the data highlights that the general publicis far more aware of its right to complain: 95.3% ofcomplaints received by the LeO between 1 April 2011and 31 March 2012 were from members of the publicand of those complaints the majority, 95.65%, wereabout the service provided by solicitors.The next thing to consider is the areas of lawattracting the most complaints. Amongst thehighest were wills and probate (13.74%), residentialconveyancing (17.52%), and family law (17.87%).Conversely the areas of law attracting some of thelowest number of complaints was commercial law(1.26%). One has to wonder why?It might also be asked why solicitors are not handlingcomplaints sufficiently to avoid the general publicfeeling a need to refer to the LeO. There is no evidencethat solicitors are not handling their complaintssufficiently well. All solicitors are required to notifyclients at the outset of complaints procedures andthose procedures must be strictly adhered to. Howeverif at the end of that process a client does not obtain theoutcome they sought it is open to them to gain whatmight be considered a more independent view from theLegal Ombudsman. Why would a dissatisfied client notadopt that route if they have not achieved the outcomethey want?The data provided by the Legal Ombudsman is tobe welcomed. It should raise all sorts of questions inthe minds of law firms. It is not the manner in whichcomplaints are dealt with or the level of customer servicethat needs addressing (although that may be the casein some circumstances) but rather the qualification andexperience level at which legal advice is provided thatshould be our overriding concern. To provide the correctlegal advice backed up by good customer service issurely the answer to successfully avoiding being one ofthe Legal Ombudsman’s many statistics.Q: Will the Legal Ombudsman(LeO) ‘List of shame’ forcelawyers to raise standards ofcustomer service and focusefforts to effectively deal withcomplaints in-house?When the LeO ‘list of shame’A: came out, I like everyother legal manager, checkedto see if their firm was on thelist. I am pleased to say that thefirm wasn’t, so no ‘shame,’ butultimately is that the definition ofsuccess in client care?What does not being onthe list mean? It could be indicative that you have acommitment to service and quality, or that you are verysmall or maybe that you are very good at dealing withcomplaints. All or none of the possibilities may apply.Further, does being on the list mean the opposite?Also, what weighting should we give to referrals withno finding against you versus actual findings againstyou? Do 10 referrals with no finding against you equalone finding against you?What struck me first about the statistics is how fewfirms were on it. So not damming, but actually proofthat most people are happy with their legal advisors.Second was how few referrals were upheld. So againreasons to rejoice.What lessons are there to be learnt? All you can sayis that if you were the complaints partner at a firm inwhich you had lots of referrals but no findings, then onthe face of it, you are doing great. But you are beingdragged into LeO and it is sapping your time. So putsome energy into better communications with the clientto avoid it coming to you.If the complaints are being upheld, then you have tolook at everything and maybe the list is further impetusto solving the problem.Is publishing the list good or bad? On balanceprobably good, as transparency has to be the wayforward. However, it is impossible for me provideproper analysis of the data as it is very limited. I leavethat analysis to the individual firms on the list, as theywill have in depth data on the causes of their owncomplaints. What the list actually shows is that the vastmajority of solicitors are doing a good job in the teethof austerity, increasing client demands and constantchange.By David Bott, Immediate Past President of APIL andManaging Partner of Bott & CoBy Angela Moores, Jarvis Family LawML // November 2012

00 24 ???? The viewsQ: Will the Legal Ombudsman‘list of shame’ force lawyers toraise standards of customerservice and focus efforts toeffectively deal with complaintsin-house?When you stand in anA: airport queue at the Ryanairgate and see someone go tothe front for priority and thenreturn shamefaced, they have justcompleted the dreaded “Walkof Shame”, to the amusementand gratification of all thosenon priority customers patientlywaiting their turn. As lawyers we now have our ownequivalent in the “Hall of Shame” published by the LegalOmbudsman (LeO).A quick review of the Conveyancing stats showthere are 124 Firms on the list with a combined 137decisions. From the 124 firms there are only four firmswith two or more entries. The overwhelming majorityof firms are therefore showing one decision only. Againmy calculations suggest out of the 124 firms there areone or more remedies registered against some 49of those firms. That means again the majority of theconveyancing firms in the list had no finding of anysanction.According to the FAQ’s this means either that theLeO was satisfied with the service the lawyer or firmprovided, or that the ombudsman’s decision wasequivalent to what the lawyer or firm had alreadyoffered to do when it dealt with the complaint. Where adecision has been made there are details of the range ofthe compensation (but not the actual amount) or otherremedy.I know that statistics are there for interpretation. Itseems to me however that what is there is unlikely tobe a deciding factor in the choice process of a firm oflawyers by a client. That is not to say I view the processas not having any benefit. I do see how firms will wishnot to be added to the list (their overriding wish willremain however not to be referred to LeO in the firstplace). I also see that this list could easily grow inimportance. (I am not aware if searching for a lawyerwould throw up any list reference in Google yet or inthe future).Will it focus firms to hone their in house complaintsservice ? – I think the answer is that this is one moreweapon in the armory to encourage lawyers to dealeffectively with complaints and for all of us that ofcourse is a good thing.By Eddie Goldsmith, Partner, Goldsmith Williams & Chairof the Conveyancing Association.Q: Will the Legal Ombudsman‘list of shame’ force lawyers toraise standards of customerservice and focus efforts toeffectively deal with complaintsin-house?I’m looking at this questionA: solely from the technologypoint of view and how it canimpact on the legal practiceareas attracting the highestnumbers of complaint: residentialconveyancing, personal injury andwill & probate work.There are two core issueshere where technology can assist: (1) Practice & ClientRelationship Management in other words the customermanagement side of the relationship with the clientand (2) Case & Matter Management, which looks at theprocess management side of the relationship.With regards to the first technology, it doesn’t matterwhether it is an old green-screen Unix accounts systemor the latest CRM software, somewhere within your firmyou have the ability to contact clients and prospectsabout your terms and conditions, fee structures etc. Treatyour clients with respect and give them the facts: explainabout all the extra costs that can arise and unforeseendelays. Then, if something does go wrong, they are fullyin the picture and are not taken by surprise.There is a well-known marketing concept calledsuper-pleasing – being prepared to do just that little bitextra in the client relationship, including being proactivewhen something goes wrong. Super-pleasing andclient relationship management are both techniques wecan expect alternative legal service providers to havein their portfolio. Traditional law firms also have thetools to do this. You just need to look at matters froma customer satisfaction point of view rather than a feemaximizing perspective.As for case management! Per-lease! This technologyhas been around since the late 1970s so there isabsolutely no excuse for any forward-thinking law firmnot to be using it!A good case management system is simultaneouslya performance standards compliance and riskmanagement system. If you set up the system to ensurethat deadlines are not missed, clients are kept up-todatewith progress, steps are not inadvertently omittedin a process, then you are also minimising the risk of anyof those things ever happening by ensuring your staffcomply with your best practice standards.So, to go back to the original question: law firmsalready have at their disposal the software applicationsto prevent many complaints from ever arising andfor adequately responding to them. As with manyaspects of modern legal business processes, it is not atechnology problem but a cultural issue.Charles Christian is a barrister who has been writingabout legal technology for over 30 years.ML // November 2012

The views25Tackling risk profilesa priority for PIIrenewal successThe professional indemnityinsurance (PII) renewal forsolicitors in England & Wales was,for most firms, a relatively smoothprocess. For the smaller firm,rates typically fell as the insurancemarket became more comfortablewith the exposure presentedby firms in the Assigned RisksPool, and insurers recognised that the claims positionhas improved. Not all firms, however, were offered agreat choice of insurers; we found that firms with aquestionable claims experience and/or high levels ofconveyancing exposure struggled to secure competitivequotations. In addition, placing insurance with unratedinsurers in the PII market is still very much up fordebate. The recent failure of Lemma Europe and thegrowth of Latvian insurer Balva, both unrated insurers,illustrates that market share can dictate premium. At thetime of writing we wait with interest to see how the potof PII premium will be apportioned between insurers,but what can be done to improve your risk profile overthe coming year?We expect most firms to have secured a reasonableand acceptable premium in 2012. The rates applied byinsurers have definitely stabilised, although it must beappreciated that there are over 11,000 firms, all of whichhave a very different risk profile, renewing on the sameday. No one firm is the same. Insurers still considerfirms with conveyancing exposure as presenting ahigher risk, despite the number of conveyancing claimsfor negligence and fraud reducing during the last 18months. The heightened fraud risk which arose froma trend to pursue litigation in a time of recession hasalso, from an underwriting perspective, subsided. “Don’trule anything out!” say insurers! This is perhaps faircomment, but we have hopefully seen the back of thisunfortunate trend, for the time being anyway!The main concern for insurers is that PII isunderwritten on a ‘claims made’ basis. As a result,insurers are exposed to claims arising from all workundertaken by the firm since its establishment.A number of firms have recently introduced robustrisk management processes and systems. Whilst thisintroduction assists in reducing risks attached to currentwork, risk management processes are prognostic;they do not always address risks associated with workcarried out in the past. We encourage firms to do ‘allthey can’ to demonstrate a consistent approach to themanagement of risk.By Martin Ellis, Managing Director, Prime Risk SolutionsQ: Will the Legal Ombudsman‘list of shame’ force lawyers toraise standards of customerservice and focus efforts toeffectively deal with complaintsin-house?The recent decision byA: the Legal Ombudsman(LeO) to name and shame thedecisions regarding complaintsabout lawyers has taken manyby surprise and produced splitopinions on the subject.The list will be published ona quarterly basis showing thecollated names of lawyers or law firms involved incomplaints which had led to a formal decision by anombudsman.The recent list contains over 900 decisions involving770 law firms across England and Wales.The authority to publish is contained in theLegal Services Act 2007 and the reasons behindthe disclosures are to promote consumer interests,transparency and to encourage higher standards withinthe legal profession.Commenting upon the decision, Adam Sampson said:“What we are trying to do with this policy is give objectiveinformation about the way the market is operating”.Elizabeth France, Chair of the Board, said: “We hope thisinformation will help manage consumer expectations ofwhat the Legal Ombudsman can offer and encourageimprovement in complaint handling by lawyers”.A completely different take comes from a seniorlawyer in the North of England who believes that all thiswill do is take complaints ‘underground’ and most lawfirms will not want to be named and shamed for fear oflosing market share. Law firms will, he says, simply ‘buyoff’ most complaints which fail to reach a satisfactoryconclusion. If he is correct that means the Ombudsmanwill receive fewer complaints and assume his policy isworking but the opposite will be true, and of coursenobody will be able to assess the true situation. Gettingan accurate picture of this if law firms take that courseof action will be virtually impossible to ascertainalthough every law firm has to keep such records.Consumers will undoubtedly champion thisbreakthrough and hope the views expressed by the LeOare correct, now that the law has come into line with thepractice of other Ombudsman schemes.Many will undoubtedly feel that the jury is verymuch out on this subject and it will be interestingto see what happens in the next 12 months to theOmbudsman’s statistics.By Chris Owen, Chief Executive, St Philips ChambersML // November 2012

The views27Q: Dealing with compliance isstill the devil in the detail, withthe Risk Register proving to be anew headache. So, how best totackle them?Important dates have comeA: and gone with more diarisedfor the coming months. I don’tthink this will change for us in thenear future as the legal sectoris all about new requirements,amendments, updates, changesand reviews.Great to see firms prioritisingcompliance and enquiries regarding outsourcedservices are at an all time high.New firms we are working with are going throughcompliance reviews. Firms that have completed thecorrective action required and have their complianceplans drafted are going for Lexcel. One area we areworking on with all our firms is the Risk Register.Registers that we know well include those used forDeclined Instructions, and High Risk Instructions but theRisk Register is something new.So how to go about drafting one? You firstly need toconsider the main categories: Strategic Risk, DisasterRisk, Regulatory Risk, Financial Risk and Operational Risk.Then consider the generic risks per case type thatyou deal with: Residential Conveyancing will includeRegulatory risks including Money Laundering andMortgage Fraud. Negligence claims and Conflict ofInterest will also be applicable. List these for each casetype that you deal with.Then move onto the detail. The way we areapproaching this is in the format of a table and eachrisk is listed and the grading of the risk is then stated.You need to consider what the starting risk is and if thischanges due to the processes and policies you haveput in place. So as an example Money Laundering maybe high risk to start off with but due to the policiesand procedures that are in place, the risk may bedowngraded to medium or low. Other specific riskscould include failure to report breaches to the COLPand COFA, the risks of being removed from lenderpanels, losing clients and tenders.Finally, bear in mind that the Risk Register is aworking document that should become a valuable tooland an important part of your Risk Management.By Jaunita Gobby, Director, Legal Eye LtdRisk: identify,target, complyRisk assessment is compulsory*but how do you do it?Looking at your firm’s claimshistory is OK as far as it goes. Afterall lightning often strikes twice inthe same place. But rememberonly a tiny proportion of mistakesproduce claims, so your claims datadoes not tell you enough.Also look at complaints. Losing a good client cancost as much as paying out on a claim. So scrutiniseyour firm’s own complaints records but also check outthe data from the Legal Ombudsman (http://www.legalombudsman.org.uk). This shows that clientsmostly complain about a failure to crack on, ratherthan mistakes (i.e. failing to advise or keep the clientinformed, or to make progress accounts for half ofcomplaints). Do you have adequate training, guidelinesand supervision to address those issues?Also check your records on time written-off. Again,firms lose more money through write-offs than claims.The people who are writing off time and producingcomplaints are probably the ones who are creatingother risks too.Use a structured approachThere are many potential risk areas, so think carefullyabout all your management systems. Socratespublishes a questionnaire that takes firms through thekey areas.People issues are often neglected, but that is wherebig risks can lie. For example do you have some rogueelephants in your firm, who refuse to submit to normalprocedures and supervision? Do you have anyone whois serially unreliable, or has a drink problem, or (whisperit quietly) you do not trust? These are tricky problemsto resolve, but the first step is to acknowledge that theyexist.For each risk identified, estimate its likelihood, andthe seriousness of the potential consequences.When you have identified the risks with seriousconsequences, which have a significant likelihood ofoccurring, you have to set about mitigating them. Butthat is for another day.By Bernard George, Director of SocratesTraining Limited* Code of Conduct Outcome 7.3 requires that you:‘identify, monitor and manage risks to compliancewith all the Principles, rules and outcomes and otherrequirements of the Handbook, if applicable to you, andtake steps to address issues identified’.ML // November 2012

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The views29Keeping up withthe changesAs happens in all businesssectors from time to time, keyterminology and phrases can beupdated almost overnight, and thesearch industry is no exception.From October this year, wewill now see Personal Searchesbeing referred to as RegulatedSearches and Official Searchesbeing referred to as Council Searches. It’s important tounderstand the very sound reasons for the changesbeing implement to avoid them being overlookedamidst a cacophony of groans about the time and workinvolved in updating systems.The Council of Property Search Organisations(CoPSO) made the decision to change the terminologyin respect of searches to reflect the realities of thepost HIPs world. Member companies, such as SearchesUK (which subscribe to the Search Code), operatein a tightly regulated environment -recognised inthe language attached to their search products, nowtermed Regulated Searches.Equally, CoPSO believes it is a little misleading to usethe term Official when referring to searches producedby Local Authorities. There is no basis for the use ofthis word in any statute and it implies that any searchnot produced by a Local Authority is, in some wayor another, unofficial which could be prejudicial in theminds of lawyers and consumers buying searches fromregulated providers. CoPSO has therefore decidedto implement the term Council Searches to describesearches provided by Local Authorities.James Sherwood-Rogers, Chairman of CoPSO, said:“It is important that property lawyers have a clearchoice in selecting where to source their searches, andare uninfluenced by outdated language. We hope thatthe distinction will enable lawyers and consumers tomake a more informed decision about which search toopt for.”There are pros and cons for both type of Search andthe subject has caused much debate as to which is bestfor clients and why… ultimately, there are no definitiveanswers, just personal views either for or against oneor other. Whatever type of search you prefer, whenordering through CoPSO members, you are guaranteedquality data, obtained either directly from the LocalAuthority or (in the case of Searches UK) by a qualifiednetwork of locally-based Search Agents.Andrew Stenning, Managing Director, Searches UKwww.searchesuk.co.ukQ: Will the Legal Ombudsman‘list of shame’ force lawyers toraise standards of customerservice and focus efforts toeffectively deal with complaintsin-house?A decision has beenA: made to publish quarterlyinformation relating to complaintsabout lawyers, which is nowavailable to the public.The list shows the names oflaw firms involved in complaints,which have led to a formaldecision by an ombudsmanin order to create greater transparency, promoteconsumer interest and provide objective information.When looking at the information published, it maybe difficult to draw a conclusion about the law firmswhich appear on the list, particularly when complaintsare made and no remedies are ordered. This ultimatelymeans that the lawyers had in fact dealt with the matterproperly.I believe it is important for consumers to make aninformed choice about which legal provider they use,but the information published in the current format willin all probability not make that choice for them.The legal ombudsman does not have jurisdictionover all legal service providers, many of which areunregulated, such as will writers. The name and shameapproach may not give the consumer a true reflectionof the market.If greater transparency is required it may also bebeneficial to publish positive client testimonials.Another area for concern is the lack of data inrelation to the size of firms and/or the number oftransactions they undertake. For example, a solepractitioner may have the same number of complaintsas firm which employs over 1,000 lawyers.We have to ask ourselves, has a balance been struckbetween protecting consumers and encouragingindependent and strong legal advice? And has theinformation published added value to the consumer,or does this system need to go back to the drawingboard?By Lorraine Harrison, Head of Compliance and ClientCare, RalliOn Twitter? Follow Ralli: @RalliSolicitorsML // November 2012

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The views31Q: Will the Legal Ombudsman(LeO) ‘list of shame’ force lawyersto raise standards of customerservice and focus efforts toeffectively deal with complaintsin-house?A: On 6 October 2010 theprofessional rules of the SRAwere amended to oblige thoseregulated by the SRA to drawattention to or ‘signpost’ theexistence of a new destinationfor clients’ complaints about theirsolicitor. It is hardly surprisingthat with “signposts” in terms ofbusiness, on bills and firm’s web sites clients shouldfollow the signs and began to complain, some 35,000 inthe first year alone.LeO eventually resolved to publish the namesof those law firms which had been the subject of adecision by LeO since April 2012. The first publicationoccurred on 17 September 2012 and comprises thenames of 772 law firms.There were some 992 decisions, of which 490 (53%)did not lead to a remedy being ordered. Of the 47%which led to a decision the average award was in theband £299-£499.Name and shame provides those running law firmswith a challenge and an opportunity. While the statisticsshow that, for the most part, law firms provide anexcellent service that hard earned reputation may bethreatened by publication. The commercial implicationsof publication should spur managers to create afocus throughout their firms on avoiding complaintswhich emphasises the importance of treating clientswith respect. Even in the best run law firms things dooccasionally go wrong and in those cases fee earnersneed to strive for outcomes which leave no bitter tasteand therefore less likely to lead to referral to LeO andthe dreaded publication.Competing with businesses like the Co-Op with aprimary focus on the customer experience ensuringtheir clients are not just satisfied but delighted to havebeen a client. Law firms must adopt a similar approachand encourage that in all staff at all levels.Publication of complaints should change the focuson complaints handling from reactionary catch up toembedding a pro-active consumer positive attitude inall fee earners. If firms do not change they are likely tofind the market has left them behind.For further information on this and other regulatorymoves, read the Legal Practice Management Solutionsblog (blog.inpractice.co.uk)Revolutionising the Bar:do or dieThe Bar is in the midst of arevolution of change. There aretypically three types of barristers’chambers – the trailblazers - thosewho have been waiting to seewhat others do and those whofeel they want to remain the same.Much of the Bar is where lawfirms were some 20 years ago buttrailblazing sets are becoming more progressive thaneven today’s law firms.The understanding and need to run as a businesshas largely been driven by the Commercial Bar andthis has been filtering through to the Publicly FundedBar. Chambers have had to consider whether they arestructured strategically enough to stay ahead of thecurve – in light of reform and new competition.A number of sets now have Chief Executives,Chambers Directors, Chambers Administrators andMarketing Managers in situ. Most chambers who havegone down this route have seen the benefits fromseparating the administrative arm from the clerks’room, enabling the clerks to focus on what they do best(clerking!).The Bar has a very unique culture and the lynchpin ofthis is the clerking team. The complexity of its role is likenone other you would find in any industry sector. For aslong as the Bar exists, so will clerks in playing a key rolein a set’s success.However for sets who have been looking to instila business culture within chambers it has been onlyfitting to inject business acumen from outside of theBar. The creation and implementation of businessplans, marketing strategies, tenders/bids are oftennot areas many barristers or clerks have had years ofexperience on. Business leaders that have thereforebeen brought in have assisted sets define who theywant to be and where they want to go in the market.The sets that continue to be the most successful arethe ones where members view their clerks and supportstaff as business partners.Not all sets need a CEO – but look at any of theleading commercial sets at the Bar and they increasinglyhave a comprehensive support structure, ensuring thatbeing a business in an honourable profession does nothave to be a dirty word.By Guy Hewetson, Partner, Hewetson Shah LLPBy Allan Carton, Director, InPractice UK LimitedML // November 2012

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The Views33ATE: Still on theAgenda - Abolitionof recoverabilityand implications forcommercial casesAbolition of recoverabilityof ATE premiums and CFAsuccess fees has been muchheralded. It is anticipated tobe effected by the April 2013implementation of parts ofThe Legal Aid, Sentencing andPunishment of Offenders Act(LAPSO). Much of the focus onrepercussions has been on the impact for personalinjury claimants and on the introduction of qualified oneway cost shifting (QOCS). There has been significantlyless debate on the impact for commercial cases.Impact of changes on ATE for commercial casesThe end of recoverability does not mean the end ofavailability of ATE insurance for commercial or othercases. Neither does it mean the end of the need toaddress the merits of applying for cover, at the outsetand/or as a matter progresses. QOCS will not applyto commercial cases and cost shifting will continue toapply. A party to a commercial dispute will continueto run the risk of being required to pay a successfulopponent’s costs (and be responsible for the entirety oftheir own), should their case fail. With recoverability inplace, the advantages of obtaining cover are obvious.Where payment of the premium is contingent onsuccess, and is then recoverable from an opponent,seeking cover may be considered something of a ‘nobrainer’. When recoverability goes, that position willdiffer to the extent that the premium will be payableby the insured either from damages or otherwise. Thatis the new factor to be considered and weighed in theeconomics for each case, but the advantage of riskprotection remains just as clear.Dispute resolution lawyers are acutely conscious ofthe need to give clients the best information about thecosts of their matter from the outset and throughout.Where that risk can be offset by ATE cover, thenirrespective of the abolition of recoverability, a clientwill want to understand the relative benefits of cover inthe commercial and economic context of the particularclaim. If the claim involves a funder, that funder willoften require ATE cover as a condition for funding.The new ‘post recoverability’ world may alter somedynamics of ATE considerations but commercial ATEcover should remain firmly on the agenda.Overhaul to overcomeAs part of the service I providefor the Bold Legal Groupmembers I attended, and reportedon, the National Property LawConference that took place inOctober. The topics coveredincluded; the SRA’s Conveyancingreview; Joint Ownership in light ofJones v Kernott; the new PropertyInformation Form; Mortgage Fraud; Lender Panels andthe Conveyancing Quality Scheme.If you thought that the run up to last October, withthe new SRA Handbook, OFR, the Legal Services Actand Alternative Business Structures was hectic, thinkagain. The next fourteen months will be even worse. Theway conveyancing is carried out and delivered will, inmy opinion, change dramatically. High street law firmsreally must start paying attention now and make surethat their own houses are in order.There are new market entrants (Co-op, AA, SAGA,Direct Line) and there will be more. Say what you likeabout them but they will, over time, have a negativeimpact on your businesses.Many firms will need to give themselves a completeoverhaul. What do your offices look like from theoutside? How welcoming are they inside? Are yourfront line staff as approachable, friendly, helpful andknowledgeable as they should be? Are you telephonesanswered promptly? Is the help and advice given bythose answering the phones really as good as it can be?Are verbal estimates followed up in writing and thenfollowed up again by a phone call? Your fee earnersmight be good when it comes to the areas of law theydeal with but are they good enough when it comes tointeracting with the public? All of these things, as smallas they might seem, are important.There are many things I can help you with (forexample keeping up to date with industry changes andnew market entrants) and there are many things youcan help yourselves with. However, the first thing youneed to do is acknowledge that as times change somust you.If you are interested in joining the Bold Legal Groupand/or coming to any of our CPD events (next one15.11.12), please email: rh@boldlegal.co.uk.By Rob Hailstone, Bold Legal GroupBy Matthew Williams, Head of AmTrust Law at AmTrustFinancial ServicesML // November 2012

L L PN E S B I T L A W G R O U PBURY - LONDON - LEEDS - LIVERPOOLAssociation of RegulatedClaims Management CompaniesA member ofWhyadjudicatewhen youcan mediateMediation and Conciliationprovide most satisfyingoutcomesAnthony Glaister MCI ArbCommercial Mediator & Arbitrator & Adjudicatorresolve@anthonyglaister.co.ukwww.anthonyglaister.co.uk

The Features3535-51TheFeaturesML // November 2012

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Features 37SECTOR ROUNDTABLE:CONVEYANCINGModern Law asked some of the leading commentators and practitioners in theconveyancing arena to have a rare meeting of minds and give their thoughts as to where thesector is, where it’s going and what’s needed to stave off the competition.MLM: What is the present state of theconveyancing market?Harris: Conveyancers have really led the way in gettinginformation from the Land Registry. Of the 7,500 reportedconveyancers, probably around 18% of those do significantlevels of conveyancing. It’s important to ask what makes a‘top 100 firm’. According to the June 2012 Land Registrydata, 45 firms in England and Wales are doing over 100transactions pcm. It takes roughly seven people in adepartment to do over 200 transactions pcm so a leadingfirm would have at least this number of conveyancersin their department, doing residential and commercialproperty transactions.Hailstone: What we need to ask is why the larger firmsseem to be increasing market share – what are they doingdifferently? It’s partly access to distribution and panels.Not only can some of the small firms not get on the panels– as we saw with the HSBC affair – but it seems they don’teven choose to. Possibly because they simply can’t meetthe requirements.Barnett: There’s no easy answer to this. In the 1980s,conveyancing went through the estate agency route, now wehave a maturing marketplace with lenders and estate agentscontrolling the marketplace. Consumers need to understandthe value in the conveyancing process – and about thechoices available to them. Consumers also have higherexpectations of the technological access to conveyancing– along the lines of information on iphones and tabletcomputers. Technological innovations are essential.Goldsmith: Estate agents have become better atencouraging clients to use panel solicitors - they are thefirst point of marketing.Olowe: Referral fees are more profitable than selling housesas it’s all profit - it’s an attractive by-product.MLM: So what are the problems?Hailstone: Despite the fact that consumer feedback on theconveyancing process is positive, the polarisation of themarket has led to power flowing into a small number ofhands means. It’s questionable if the system is in the bestinterest of consumers.Roundtable GuestsChair: Eddie Goldsmith Partner, Goldsmith WilliamsDes Hudson Chief Executive, The Law SocietyMike Okenden Thornbury AssociatesJohn Turner Regional Manager, Landmark Information GroupRob Hailstone Founder, Bold Legal GroupChris Harris Today’s ConveyancerVictor Olowe Managing Director, Winzest ConsultingBen Harris Sales & Marketing Director, TM GroupRichard Barnett Senior Partner, BarnettsHudson: It’s interesting to see the perceived outrage bythe consumer regarding the HSBC panel. This was a poorlyexecuted move and people voted with their feet. However,despite the concern, consumers wouldn’t be worried untilthey are informed. Unless they are told by solicitors, thepublic will be unaware of problems arising. Panel problemswith lenders will continue unless regulatory action is taken,which is unlikely.Hailstone: The benefit to the consumer isn’t necessarilyabout reduced fees but about value – the process andlawyers’ role needs to be articulated.TM Group (UK) Limited TM Group (UK) Limited includes TM Property searches and TM Secure.TM delivers flexible and efficient online systems that are designed to helpproperty professionals order and manage conveyancing information online.An independent private company with over 12 years’ experience in webbasedconveyancing tools, TM Group has developed a range of sophisticatedonline systems that focus on reducing risk and maximising efficiencies.TM’s robust and flexible systems deliver a wide range of conveyancingservices to the property industry and now are relied upon by manyorganisations. TM Official Search Services links local authorities directlywith conveyancers helping to smooth the process of ordering OfficialSearches whilst reducing unnecessary costs whilst TM Property Searchesoffers Conveyancers an online search ordering and managementsystem including over 75 different searches, instant title insurancepolicies and a sophisticated anti-money laundering solution. TM Secureprovides mortgage lenders and their panels an effective and efficientway of managing the conveyancing process and itsassociated risk. Many search suppliers also rely onTM’s efficient technology to access searches for theirown customers.For further information please visitwww.tmgroup.co.uk or call 0844 249 9200Or email info@tmgroup.co.ukML // November 2012

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Features 39MLM: How is the high streetmarket looking?Harris: The cottage industry stillremains – roughly 70% of transactionsstill remain with the high street butthis is disparate in apportionment. TheConsumer Panel reported this yearthat the public is increasingly satisfiedwith the local high street solicitorconveyancing service, suggesting thatlocality and face-to-face is sellable.High street firms need to get togetherand get to grips with where themarket is going and their role in it.They’ve got to be savvy and pick upthe excess work.Hudson: The UK opticians sectoris used as a parallel to the currentconveyancing situation. It sawsignificant change in regulation in theowner managed companies. It’s takento the mid-2000s for the numberof employed opticians to get backto the number seen pre-1985, whenregulation hit the market. It’s taken20 years for this to happen, howeverwhile employment in the sector hasincreased, for owners the situation hasworsened. Owners of law firms willhave a choppy ride. This is a personalview but the implications of ABSs willbe seen on the high street. Perhapswe’ll see a shift in conveyancersdiversifying and expanding to pick upother areas of work and then return toconveyancing after time.Hailstone: But work in progressfunding is hard to get and challengesfor work in other areas, such aspersonal injury, may limit this.MLM: What has been theimpact of The Law Society’sConveyancing Quality Scheme(CQS)?Goldsmith: 1,725 firms have qualifiedat the moment and 2,100 are in thepipeline. The questions are: why so fewcompared to the overall number ofproviders and will this change?Hailstone: Some aren’t looking to theCQS until they’ve seen what the benefitsare. They’re waiting to see whether it willevolve and survive the initial flurry.Goldsmith: But if they’re a seriousconveyancing solicitor then the have tohave the CQS accreditation...You’d haveto be living in a vacuum to not want tobe on the CQS – it’s essential for lenderpanel applications as much as the client.Olowe: CQS comes back tounderstanding what the client wantsand adapting to deliver that. If you’renot a CQS firm, it’s difficult to pitchyourself as customer focused.Hudson: It has to evolve. I havewritten to the CQS firms to tell themprotocol will be enforced and somewill be rejected for reassessment ifthey aren’t followed. If member firmsaren’t complying then other memberfirms need to tell us. Whateverhappens in the market, there’s noreason for solicitors to go downmarket in quality and standards ofservice. There is another elementto the CQS of course. The decisionto open up regulation is massivelyimportant. I’m concerned this will –in the future – lead to a competitiveregulator market competing onstandards and price. A licensedconveyance can only get the CQSappointment if it’s regulated by theSRA – a useful quality assurance.Barnett: On the lender panel point,it’s got to be noted that the workDes has achieved with the lenders interms of the CQS is tremendous andwe wouldn’t have got where we arewithout him. It’s not said often enough.MLM: What about the future ofthe CQS?Hudson: We’re planning to create aconsumer facing brand – similar andlinked to Find a Solicitor. It will be theequivalent of the CORGI (gas safe)accreditation for technicians, althoughit would require a significant amountof money to get the brand out there.Olowe: The problem is, most of thework comes through a third party – isit the best thing to market to thegeneral public?Hudson: The message needs to getthrough at the point of sale – by theestate agent or the lender, usingpowerful at sale communications. Alsoto use social media as a cost-effectiveway of spreading the brand and go viral.Olowe: The solicitor brand is a valuableone – the CQS is a subsidy of that andwould be effective.Hudson: It’s quite a task to setourselves but we’ll get there.MLM: Is Separate Representation(Sep Rep) going to happen?Olowe: Sep Rep is only there for theinterest of lawyers, not the consumerand until it is, it’s not going to happen.Barnett: It’s difficult seeing it happenas per the full blown system beingdiscussed at the moment. Sep Replight might be different...Okenden: The sector needs to focuson the how and why Sep Rep wouldbe in the best interest of the consumer– it might be a positive move for highstreet firms at some point but only ifthe its on the agenda for consumers.Goldsmith: The issue with Sep Rep isthat until we have the systems in placeto deliver conveyancing quickly and costeffectively, it might not be as attractive.However it does bring back face-to-facemeetings with the customer. It would alsohave a positive effect on PII insurance.Hudson: We have an open doorapproach to Sep Rep ideas – clientchoice is a benefit. However we doneed evidence to sway the regulatorsto do something.MLM: What are the key messagesto practitioners?Harris: Make sure you act in theconsumer interest, not just your own.Okenden: Conveyancers need to focusclosely on diverse consumer needsand then deliver.Turner: Capture and retain consumersby meeting their needsBen Harris: The high street needs toaddress it’s commercial needs.Hudson: Survival isn’t compulsory butdoing nothing just isn’t appropriate.Hailstone: It’s game on not game over.Get involved now and focus on the client.Barnett: Make a decision: who do youwant to be and focus on that.Landmark Information GroupLandmark Information Group has quickly developed into the market leader in the field of property related environmental risk information anddigital mapping since the inception of the business in 1995.Landmark has an unrivalled source of large scale current and historic digital maps together with high quality environmental risk and planninginformation. The focus on quality data enables Landmark to provide solutions that create peace of mind for our customers when using one of our products.Working closely with data providers including Ordnance Survey, the Environment Agency, the Coal Authority and the British Geological Surveyenables Landmark to offer current and historical environmental risk management information and desktop mapping solutions for the property industry.Since 1995, approximately £20 million has been spent establishing the Landmark databasewhich exists as one of the largest geographical information databases in Europe.For further information please contact Jacki NorburyDirect Dial : 01491 414 823 Office : 0844 844 9952 Email : jacki.norbury@landmark.co.ukML // November 2012

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Features41Great expectationsIn the conveyancing process, clients’ expectations of flood risk investigations ‘as standard’ aremisaligned, despite insurance risks and legislation changes set for 2013, as David Mole reports.Arecent survey has revealedthat 55% of property ownersin the UK expect solicitors toautomatically investigate a property’sflood risk as part of the conveyancingprocess. The survey, commissioned byLandmark Information Group, has alsohighlighted that, despite 80% of UKhomeowners stating that they wouldnot buy a house that was at risk offlooding, only 42% of people actuallyinvestigated their flood risk beforebuying their home.• 55% of buyers expect theirsolicitor to investigate aproperty’s flood riskautomatically as part of theconveyancing process• 80% of UK homeowners wouldnot buy a house that was at riskof flood but only 42% of peopleinvestigated their flood riskbefore buying their homeThe CML states that, in order to protectboth the borrower and the lender, it isa requirement of all mortgages for theproperty to be covered by standardbuildings insurance, including floodcover, for the full term of the contract.If insurance is not available, then it islikely that a purchaser will not be ableto obtain a mortgage.The Statement of Principles:Impact on InsuranceThe Statement of Principles, anagreement between the insuranceindustry and the Government whichcommitted insurers to continue toprovide flood insurance for mosthomes and small business premises(even in areas of significant flood risk)is scheduled to come to an end on 30June 2013 and will not be renewed. As aresult, the ABI declared insurers wouldreturn to ‘risk-based’ pricing followingthe end of the Statement of Principlesunless they and the Government comeup with an alternative.The impact of this is that owners ofproperties with significant or high floodrisk are likely to find that their premiumsor excess increase or that certainconditions are imposed on cover. I knowof several cases whereby insurance hasincreased by two-thirds and the excessamount has risen to as much as £15,000-£20,000 – and they are among the luckyones; those at greatest risk may not beable to obtain flood cover at any cost.Added to this, where flood insurance isnot available, the property owner may bein breach of their mortgage.Flood Risk AssessmentsIt is crucial, therefore, for legalprofessionals to encourage theirclients (whether the purchaser, tenantor the lender) to obtain a desktopflood report for any property they areconsidering purchasing or taking alease of. This will highlight any potentialproblems, enabling legal professionalsto research whether insurance coverwill be available & affordable and todiscuss flood resistance or resiliencemeasures at a stage when it is stillpossible to renegotiate the purchaseprice or cost of the lease.Solicitors need not, however,become data or mapping experts,or even hydrologists, to understandthe various types and levels offlood risk; help is at hand. Desktop,conveyancing-ready reports are easilyavailable to solicitors, making their jobof providing a comprehensive servicefor their clients very straightforward.Common myths, such as“I don’t live near a riveror the coast so I can’t beflooded” and “I live on ahill so it won’t happen tome”, need to be dispelled.I strongly urge solicitors torecommend clients obtain acomprehensive flood report asstandard practice. Common myths,such as ‘I don’t live near a river or thecoast so I can’t be flooded’ and ‘I liveon a hill so it won’t happen to me’need to be dispelled. The floodingwhich occurred in Wales duringJune of this year took place in someareas that have not flooded in over80 years. Flash flooding is the mostfrequent type of flooding in the UKand, as demonstrated by the rainfallthis summer, homes do not need to benear a river or the coast to be affected;it can happen anywhere to anyone,often with little warning.Every individual has a different riskprofile and offering a comprehensiveflood report as standard practiceremoves the assumption of risk ontheir client’s behalf.Our Homecheck Professional FloodReport, www.homecheckpro.co.uk,is a desktop, conveyancing-readyflood risk screening report designedto enable property professionals toassess the risk of flooding at residentialproperties. Following feedback fromour customers, the report has recentlybeen significantly enhanced to ensurethe clearest risk analysis possible andincludes new data sets to provide acomprehensive assessment covering alltypes of flooding.From 1 July 2013 onwards, if aproperty is ‘at significant risk’ it mayprove extremely expensive - if notimpossible - to obtain flood insurance.If a property cannot be insured, thesolicitor will be unable to provide thenecessary Certificate of Completionto the Lender to release the mortgagefunds and the buyer will be unable tocomplete the purchase.David Mole, Director of EnvironmentalDue Diligence for LandmarkInformation Group* OnePoll survey, August 2012.ML // November 2012

Features43Referral fee ban:the Titanic disaster?The imminent ban on referral fees in personal injury claims will transform anindustry worth at least £3 billion per annum. The orthodox view, at least amongst readersof this magazine, is that the transformation will be for the worse. Optimists may findhelpful guidance for the future by looking to the past.As Tony Walton writes.Scene: April 1912, North AtlanticWarner: Good evening Mr. Cholmondeley.Cholmondeley: Good evening, Warner. I was just going tore-arrange the deckchairs. Captain Smith was telling us overdinner it’s going to be sunny tomorrow.Warner: But Mr. Cholmondeley, haven’t you seen thaticeberg over there? We’re heading straight for it!Cholmondeley: (Looks out to sea) I don’t think it’s clearlyenough defined yet. It’s probably just a shadow. If it was aniceberg, we’d have heard something from the bridge by now.Warner: I’m sorry Mr. Cholmondeley, it’s definitely aniceberg. We must tell everyone and make sure they’re allsaved.Cholmondeley: (Looks again) Hmm, yes I can see now it isan iceberg. Not to worry. We haven’t had any trouble so farand anyway don’t you remember how they said we wereunsinkable? They’re bound to find a way through, theyalways do.Warner: Don’t you know what icebergs can do to a ship?!Cholmondeley: I don’t believe a word of it. Besides, thereare still a good couple of cables before we hit it.Warner: A couple of what did you say?Cholmondeley: Cables, they call them. I’ve been travellingby sea for years, I know my stuff.Warner: We can’t miss it now. Even if we just scrape past it,we’re heading straight for those three much bigger icebergsover there. Can’t you see, one’s shaped like a capital A, thenext a capital B and that squiggly one?Cholmondeley: You worry too much, Warner. There’s plentyof time to steer round.Warner: I’m sorry, Mr Cholmondeley, I’m heading for one ofthe lifeboats. Won’t you come with me?Cholmondeley: Me? In a lifeboat! Don’t you know who I am?(Pauses) Maybe I’ll come along after I’ve finished with thesedeckchairs. There are bound to be plenty of lifeboats to goround, though I must say it’s looking quite chilly out there.Mr. Warner escaped in one of the lifeboats. Mr.Cholmondeley and Captain Smith failed to recover theirsuccess fee.The inquest into the sinking recommended theimplementation of modern design, technology andprocedure on all future crossings. All the survivors,chastened by their experience, learned the importance ofcontinuous innovation and forward thinking. As a result,many of them achieved greater success later in life thanthey had previously expected.One hundred years later, there are amazing new ways toallow many more people to cross the Atlantic, safer, quickerand cheaper than ever before.Tony Walton, Managing Director of Questus, the LegalOutsource Specialists.www.questus.co.ukThe Tipping PointEarly in WWI, it was still possible towitness cavalry charges. Soldierswould wear coloured tunics foropponents to recognise. Within a fewshort years, everything was tanks andkhaki. I have little doubt that soon,some traditions in the legal professionwill appear just as naïve as dressingup in bright colours, sitting so yourenemy can get a better look at you.For example, why do law firmscontinue to have teams of senior feeearners in expensive locations? Lookno further than the hourly rate regimefor an explanation - there has beenno need to evolve to make a profit.Profitable hourly rate work, aboveall in the field of personal injury, nowcomprises less of a typical work profile.Incessant salary demands have eateninto any profit ever to be had fromfixed fee work (and that’s before portalfees fall off a cliff). Many in PI are layingdown their flags and running to thehills. A new strategy is essential forthose choosing to stay and fight.Outsourcing of mainstream feeearning work, even to a location whereit can be done both profitably andcompetently has up to now been aforbidden zone. The existential changesunder way require that line to becrossed. Legal services are no longerring-fenced from modern businesspressures. Today we are at tippingpoint. It is certain that non-lawyerowners will introduce outsourcing andwhite labelling to their law firms as amatter of routine. This is not a war andlives are not at stake; however careersare in jeopardy for those who do notmatch this fire power.ML // November 2012

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Features 45The impactThe existing system ofpersonal developmentvia CPD is increasinglyunder fire as being unfitfor purpose. It embodiesthe box ticking that thenew broom of outcomesfocused regulation (OFR) isdesigned to sweep up andbin. This makes it all the more astonishing thatit often remains the primary, or only, investmentin people development, and given that a firm’sintellectual capital is the only real differentialin an acutely competitive market, it is underresourced at great cost.It may have had to take something dramatic,like the de-regulation of the entire sector, to raiseinvestment in people higher up the strategicagenda. But with competition coming from nontraditionalcorporate entities, aligning peopledevelopment strategies with the corporate strategyis now an imperative. In a sector that relies on thequality of its intellectual capital for its profit - thereis a pressing need for a presence at Board level.OFR places competencies at the heart of theregulatory framework, developing individuals toreach and maintain competencies appropriate totheir work, and it is not about what the firm deemscompetent but what the client deems competent.Add to this the fact that complaints by clients canappear in the published ‘List of Shame’ by the newOmbudsman; this is deeper than a tick box exercise.Developing people under a penalty systemis not ideal, but anything that ensures genuineinvestment in a firm’s most valuable resource hasto be cheered. People development strategiesmust take a place at the Boardroom table and,when they do, the next generation of lawyers -and their clients - will be the better for it.By Bernadette Lyons, qualified solicitor andcorporate coach. P.Manners Founding Strap Ad.pdf Director 1 04/07/2012 of 09:38:30Platinum Leaf.People firstABSs and the shift from input to outcomes in regulation has had a resounding impacton personal development plans. Modern Law speaks to two experts on the impact ofchange and asks for some practical guidance.A strategy in practiceHere are three very old adages: legal practice isa people business; people buy people; a firm’sgreatest asset and investment is in it’s people.Why then are we so reluctant to continueinvesting in them when the relationship with thebottom line is such a direct one?No, we’re not just talking money/benefitspackages (although both are importantand helpful in maintaining motivation andproductivity). How much time do we invest in identifying strengths andweaknesses, what makes partners and staff tick, skills development, andcontribution to the firm’s future productivity and profitability?Key is the firm’s Personal Development Review (PDR) scheme.Better known as the oft-scorned appraisal system, it is as relevant asever to a firm’s well-being – even more so when there are significantchanges to be implemented in the way we work.Key attributes an effective system should deliver:B uilding potentialI dentification of weak spots, blindspots, strengthsS pecifying objectivesC ontinuity of process (follow-up)U plifting staff (motivation)I nformation feedbackT raining needsAn effective system should be fresh, forward-looking and relevant.Motivated people with the right skills are essential in deliveringworkable Business Planning and agreed objectives. Without them howcan you do so?Some key pointers: Have some idea where the firm is heading;ascertain where skills gaps lie – they’ll highlight internal developmentneeds and/or who to recruit (and at what level); arrange PDR’sbefore annual strategy reviews – you’ll need the raw material; timing,preparation, ambience, the right questions, empathy, and mutualinvolvement in follow-up are crucial, and; listen!Combined, these will tease out priceless nuggets of information,which should then be collated at a partner/manager level reviewsession so they can be fed back in to the broader strategic process.Your format needs to work for reviewer, reviewee and firm. Is it timeto redesign yours? You don’t have to be a new legal entity to justify it!Matthew Tasker, Principal, Taskers Law Management ConsultingCMYCMMYCYCMYKML // November 2012

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Features 47Best in breedKey to the ABS model is to be best in breed for clients through the consistent delivery of high quality andclient-focused services. The medical and rehabilitation solutions for PI ABSs (often providing the firstopportunity for face-to-face interactions with clients) are integral to this strategic vision and can helpABSs meet their outcome focused regulatory requirements. Mr. Bippon Vinayak reports.The ABSexperience iscurrently limitedto a small numberof diverse businessstructures rangingfrom private equitybacked, international listed companies,to the long established specialist PIfirms. Despite the lack of meaningfulmarket information, it is highly likely thatthe new breed of ABSs will be lookingfor bespoke solutions when sourcingmedical evidence and rehabilitationservices. These services are currentlylargely provided by a small number ofmedical reporting organisations (MROs).The medico-legal reporting provisionhas evolved over the last 20 years toreflect changing needs and dynamicswithin the personal injury market. TheMROs have worked with solicitors andinsurers over many years and are nowan integral part of the personal injuryprocess. In fast track cases involvingsoft tissue injury, the MROs providerapid turnaround of reports at a costagreed with the Insurance industry(MRO Agreement). So, what are thenext challenges for the medico-legalmarket? The Government has mutedthe introduction of court appointedexperts and this may lead to a verydifferent medico-legal landscape. I willcover this in a future article.Apart from service provision, theMROs have provided commercialbenefits to their customers in the formof commission payments, extendedcredit terms and write off facilities.The legal market is bracing itself fora reduction in top line revenue fromlower portal fees, loss of commissionsfrom ATE, medicals, rehabilitation etc.So, can the gap be bridged?In my view it is inconceivable thatthe highly developed, technically savvyand streamlined MROs will not comeup with LASPO compliant commercialsolutions to continue to play an integralpart in the industry. The likelihood isthat the more advanced MROs willform collaborations with the majorwork providers and law firms, to ensurethey can provide a highly integratedsolution with significant commercialbenefit to the lawyer and referrer. Manystructures are being considered and willbe subject to counsel’s opinion over thecoming months. These changes maylead to much tighter and longer termpartnerships between the various parties.There is every chance the newarrangements may even provideenhanced commercial benefits for thevarious stakeholders in our industry.Is this optimism misplaced? The influxof institutional investment in this areaamidst confused market conditionsmust indicate underlying belief inthe sector opportunity. The market islikely to experience unprecedentedinvestment that may radically changemarket dynamics. The sector hasalways been profitable, but cash flowhas been an enormous challenge and abarrier to entry and growth.Although a handful of ABSs and lawfirms may explore developing in-housecapabilities to deal with various partsof the claims process, most will look for‘best of breed’ solutions to complimenttheir core competencies in the provisionof legal services. The synergies fromvarious collaborations could result inunique market offerings and advantagesresulting in an opportunity for greatermarket share. The ABS is driven by astrategic agenda. They will want toestablish a distinct brand associatedwith excellence, in an attempt to crosssell a variety of legal and associatedservices to the consumer. Striving forexcellence will need to be embraced atall customer touch points.The medical and rehabilitationservice is an important part of theclaimant personal injury experience, asit may be the only time the claimantcomes face-to-face with a professionalperson, as many will never meet theirlegal representative. The administrationservice provided by the establishedMROs needs to reflect the business,customer values and ethics of the ABS.Rehabilitation has seen a significantgrowth in the market and will forman integral part of the servicecustomers will expect and demandrather than receive in an ad hocmanner. The development of proactiverehabilitation makes the servicereadily accessible at the very time it isneeded and when it is most beneficial.Efficient administration of medicalassessment and immediate provisionof rehabilitation leads to a highlypositive customer experience.The emergence of Damage BasedAgreements may result in the claimantlooking for additional value from theirchosen supplier of legal services. Thelegal industry will need to review alltheir service providers to ensure theyare providing the best the markethas to offer. There has never been agreater need to differentiate from thecompetition. All stakeholders need toput the customer first and subscribeto world class service. If the end resultof the various changes is a bettercustomer experience and greatercustomer focus, then the changes willhave reached the desired outcome andpass the outcome based regulation test.Mr. Bippon Vinayak, FRCS, is Chairmanand CEO of Doctors Chambers Group.Handley Law specialisein Personal Injury claims.We provide advice and assistance to clients all over the UK.We are proud to offer a professional, friendly service and arecommitted to providing the highest level of client care.The Personal Injury Experts0845 676 9228 • www.handleylaw.co.ukSBT1273 Charton Grant Handley Law Starp Ad.indd 1 12/06/2012 11:56

48 FeaturesABSs: A case ofTortoise v Hare?It’s been 12 months since the formal introduction of Alternative Business Structures (ABSs) bythe Legal Services Act 2007. So what impact has this had on partnership structures?Eimear McCartan, reports.Prior tothe LegalServicesAct 2007 beingintroduced,speculation aboutthe effects suchradical changeswould have, wererife. In particular, those pessimisticabout the changes lamented theundermining of the legal professionvia the introduction of so-called ‘Tescolaw’, combined with the ringing of thedeath knell for the high street firm aswe currently know it.For individual partners of thetraditional partnership model, therewere concerns that their hard-foughtposition would become increasinglyredundant and outdated as a morefluid model was introduced. Atpresent, the evidence suggests thatfor individual partners, the gloompredicted has yet to come to pass.Recent assessmentTwo pivotal pieces of research havebeen recently carried out whichassesses the consequence theintroduction of ABSs has had on thelegal world since introduction. Theconsensus is the practical implicationsto date have been somewhatunderwhelming.In June 2012, research was carriedout by Jures on behalf of law firmFox Williams which involved a majorsurvey of 100 commercial law firms.The results are an interesting indicationof the current mentality of partners incommercial law firms and suggest, atpresent, there is reluctance to medalwith the status quo. Of those surveyed,62% identified loss of control as thebiggest barrier to change, whilst 51%identified resistance from partners as anobstacle to introduction of the ABS.The findings of the second piece ofresearch carried out by accountants,JW Fisher and Company, followinga survey of 75 small-medium sizefirms in the South East, were equallycautious. 89% of those surveyed werenot affected by the Legal Services Act2007, with 52% expecting the Act notto affect them over the next 12 months.In spite of the slow pace of changeto date, some of the findings of theresearch carried out do demonstratea potential willingness to embraceopportunities in the future. In the Juresresearch, over half of those surveyedfound the prospect of private equitycompelling or very compelling, and39% have already changed theirmanagement strategy as a resultof the implemented changes. Suchfindings suggest that whilst there isan initial reticence about evolving, theseeds of change are planting in theminds of many.Thoughts for the futureThe consequence for partners of thiswillingness to embrace change couldbe far reaching. The underpinningethos behind the Legal Services Act2007 helps to shed light on what theconsequences for individual partnersmay be in future. The drive forintroducing the ABS was to encouragelaw firms to become more streamlinedand competitive by offering combinedlegal and non-legal services, with theopportunity for outsider investment.For individual partners, the worryingword here is ‘streamlined.’ This wouldsuggest that those partners not quitefitting the bill - those underperformingor those resisting the alternativestructure - will be ousted. Partners needto be prepared for a de-cluttering ofthe traditional partnerships as lacklustreperformers are replaced by non-lawyerswith innovative skills, business acumenand commercial minds.Obstacles partners may experiencein future, or indeed may already beexperiencing as more flexible legalstructures are embraced and thetraditional partnership model is chippedaway, includes a loss of control of theirfirms as outsider investors’ takeover.Alternatively, lock-in clauses may beused to ensure high performing partnersstay on after investment by a privatefunder. Others have bemoaned thelikely loss of loyalty, commitment andtrust between partners which will comewith the move away from the trustedpartnership model to a more modernand commercial legal environment.The need for changeThe changes implemented by theLegal Services Act 2007 to date canhardly be described as revolutionary;indeed they have been more sedatethan sensational.Despite this, the signs are emergingthat changes are afoot and attitudesare shifting. What is very clear forpartners is the need to adapt to thesechanges to survive in future. Already intoday’s climate, partners are expectedto be multi-disciplinary; they need tobe lawyers, managers, marketers andbusiness developers.The introduction of the ABSreinforces the need for partners tobroaden and hone their business skills,perhaps by undertaking further formaltraining. In this way they can addincreased value to a more commercialbusiness environment. In addition,a clear vision and plan for the firm,defined roles within the partnership andtransparent processes will also help toease partners into this new setting.A word of warning at this stage;partners also need to be prepared torelinquish control to some extent infuture if outsider investors are to playa role; a certain loss of independenceis inevitable. For some partners,adjusting to this may be very difficultto accept.Overall, the effect of the introductionof ABSs is akin to the tale of thetortoise v the hare. Whilst the changeshave been slow to impact the legalsector, ABSs are still likely to have theirday; ultimately the tortoise will win out.Eimear McCartan,Partnership Law Solicitor, RalliOn Twitter? Follow me @PartnershipLaw or @RalliSolicitorsML // November 2012

Features49Get in sync‘Anthony Smith sheds light on LawSync. This scheme, created by academic institutions, ensurescourses are in tune with sector needs in its delivery of graduates and upskilled practitionerswith the rapidly changing world of legal services.’Some readers may recall in the last edition of ModernLaw Magazine, James Caan was quoted as saying that:‘…a message does need to be sent out to academicand legal institutions to invest further in communicationskills for new and existing lawyers.’Some law schools around the world are already startingto take up this challenge and, indeed, going further. MitchKowalski, author of a new book about what a law firm ofthe 21st Century might look like and member of an initiativeknown as LawSync, has said that while James Caan’sobservation is a good starting point: ‘law schools need tostop teaching students about law as it used to be and teachthem how it will be.’LawSync aims to do this. This is a project driven by theDepartment of Law, Criminology, and Community Justice atSheffield Hallam University (SHU). The name of this projectreflects participants’ desire to see a better synchronisationbetween law as an academic discipline and professionalpractice. The core LawSync team is made up of RichardWhittle, Peter Griffiths and Peter Smith from SHU and threecontributors from outside legal academia: Mitch Kowalski,Stephen Allen and Antony Smith.So, LawSync:• Exists to identify and anticipate trends and issues arisingfrom the evolving legal services market.• Seeks to understand, chart, and enable innovation in legalservices.• Is non-partisan and aims to help all those involved in thelegal services industry through developing and promotingnew techniques for legal service delivery.LawSync promotes innovation and innovative thinking askey elements of legal education and legal services. It aimsto achieve this through an undergraduate teaching moduleand a collaborative network that brings together a range ofstakeholders and ‘whole market’ perspectives from aroundthe world.The LawSync teaching module asks students to respondto challenges in the provision of legal services resultingfrom a mix of regulatory, technological and consumerdriven changes. As well as studying legal service markets,with a particular focus on recent developments and thetrajectory of future change, students are afforded theopportunity to be innovators themselves and to reflectcarefully on the growing range of opportunities that legalstudy offers them.LawSync’s collaborative network also provides a range oftraining, consultancy and CPD products to a profession thatis currently undergoing profound changes. Collaborationis a key theme at LawSync. At LawSync’s inception, theSHU team felt that to help promote understanding ofthe myriad of factors influencing change and help plot acourse through the new legal services landscape, it wasvital that other voices be heard. In particular, the SHUteam were (and remain) keen to tap into insights offeredby practitioners and others working in the legal servicesindustry. The team of collaborators continues to grow,including some organisations very well known in the IT andassociated services industry.In his book The End of Lawyers? (2008) Richard Susskindpointed out that law firms can adapt to new challenges andlawyers can prosper: ‘even if they are not occupied with the jobsthat most law schools currently anticipate for their graduates’‘law schools need to stop teachingstudents about law as it used to be andteach them how it will be.’James CaanIt has become increasingly common in recent yearsto see qualified lawyers working in law firms in nonfeeearning capacities – most obviously as professionalpractice lawyers, providing fee earning staff with researchand other back-up resources. The expectation mustbe that the range of non-fee earning roles for peoplewith legal skills will increase. Susskind also listed somealternative roles that legally trained staff might playin future, such as: legal knowledge engineer, legal riskmanager and legal hybrid with skills in, say, projectmanagement or marketing as well as law. This list is by nomeans exhaustive. The point is that today’s law graduatesneed to know far more than black letter law if they are toforge a meaningful career in tomorrow’s legalservices industry.LawSync is designed in part to give SHU law graduatessome of those ‘other’ skills. It is also designed tocontribute vigorously to the on-going debate about thenature of legal services in the 21st Century and the waythose services can impact positively on the developmentof a society which should continue to strive to be fair, justand equitable for all.Anthony Smith, Director, Legal Project Management LimitedTo find out more about LawSync, visit www.lawsync.comand if you would like to collaborate with the team orotherwise contribute in some way please contactRichard Whittle, email: r.whittle@shu.ac.uk.ML // November 2012

Are yourpartners trying toget rid of you?:Family Lines Research ad.qxp 14/03/2011 12:22 Page 1Contact Adrian Anderson at Ralli Partnership Lawon 0161 615 0651 or email adrian.anderson@ralli.co.ukRalliRalli Courts, West Riverside, Manchester M3 5FTTel: 0161 832 6131 www.rallipartnershiplaw.co.ukTwitter: @PartnershipLawThe Family Minefield of who inherits?Issue from aprevious marriage?AdoptedChildren?Partner?Full Blood Siblingsor their issue?FirstCousins?Full Blood Aunts/Unclesor their issue?Half Blood Aunts/Unclesor their issue?Treasury?So many questions?- Finding the solution is what we do!Family Lines ResearchThe common sense approach toprobate geneologyMail: 2 Woodlands, York, Yo19 6LUTel: 0845 602 8885Email: familylines@btconnect.comDX: 720626 York 21www.familylines.co.uk

Business Management 5151-62BusinessManagementML // November 2012

52 Business SectionInnovating deliveryInnovation in resources for ABSs – such as software – could be a little chicken and egg. Are the providers up to speedwith the demands of those seeking an ABS venture, are they simply focusing on bespoke solutions or can smaller ABSsalso benefit to help innovate delivery? Modern Law debates the key issues with Paul Wilkinson from Lawclient andDarren Gower from Eclipse Legal Systems.Paul WilkinsonDarren GowerQ: Have ABSs and new legal entrants createdwider software needs and led to more innovative/ exclusive solutions?PW: From my discussions with a number of lawfirms and commercial companies seeking tobecome an ABS, their prime requirement is fora case management system that supports anefficient workflow, so as to be in a position tocompete with ABS’s already up and running.This legal workflow should also be coupledwith CRM tools to enable a strong customer focus,as there is no doubt that PPI Claims companiesscore very highly in this area. What new entrantsgenerally lack are experience in legal firmpolicies and procedures and in particular detailedknowledge of SRA Accounts Rules and COLP andCOFA compliance experience.DG: New organisations have certainly changedthe marketing direction for a lot of softwarevendors. We at Eclipse have always promotedthe client relationship benefits of our software,and it is this focus - client management and clientrelationships - that other software providers arenow starting to recognise the importance of.Q: Has there been a focus on developing clientmanagement or case management software?PW: The priority is normally in clientmanagement of a high volume caseload althoughrecognition of the need for compliance andefficiency in case management follows.DG: The lines between them (if there wereany!) have blurred and the priority is twopronged- to manage cases effectively while atthe same time providing the ultimate in client(or ‘customer’) service. This has always beenthe holy grail for legal service providers but thepriority seems to have been crystallised and isnow not just a secret held by selected, forwardthinkingorganisations.• Designed for ABS’s and COLP & COFA reporting• Outcomes-focused throughout mirroring theSRA Handbook’s structure• Content Management System for your important documents• Editable policies, procedures, forms and links• Meets The Law Society’s CQS Practice Standard, COLP andCOFA toolkits, the SRA Handbook Edition 4, SQM,Legal Ombudsman and Lexcel 5.0Lawclient have developed the first Cloud based Office Procedures Manual giving you the security of always being compliant!Call Lawclient today to get your free sample on 020 3435 5747or visit www.officemanual.co.ukComplete, Compliant and always Up to Date!ML // November 2012

Business Section 53Q: Is the legal sector catching up with the softwareinnovators (in realising the full benefits of innovation)or has the software sector had to catch up withthe ABSs?PW: An issue for most established software vendors is theirlegacy systems, some having originally been developedseveral generations ago and the reluctance of their coreclients to embrace new innovation. As business continuity,risk management, data security and encryption of emailsare only just being addressed by the smaller law firms’innovations such as CRM, in other sectors, will take aconsiderable time to be introduced.DG: I would say that the gap between what legal serviceproviders want, and what IT providers offer, is narrowing.Yes the legal sector is catching up and there are now a fewlaw firms that are pushing developments and really testingwhat is out there. This is great to see - this type of aggressiveinnovation can only be good for the sector as a whole.Q: Is software that allows for the commoditisation ofservices increasingly popular?DG: This has always been popular in areas such aspersonal injury, conveyancing and debt recovery - areaswhere throughput is high, margins are slim, and accuracy/ efficiency is therefore paramount. I don’t see demandfor this type of solution waning, in fact it should increaseas more players enter the sector and seek to provide theultimate in low-cost, high-service propositions.Q: What has the impact of ABSs been to date?PW: I think it is too early to measure the impact, at presentmost firms are just thinking about the changes. Most ABS’sare just talking about what they will do. As Andrew Woolley,a family lawyer, remarked in his Woolley & Co blog aboutthe Co-op Legal Services ABS launch, transparent fixedfees and three ring telephone answering are hardly startlinginnovations, they have been around some considerable time.Change will only be embraced when clients are lost andprofitable revenues decline.DG: The overall impact is that the focus on client managementand client experience has been pushed to the fore. Notbefore time - one of the big things that ABSs will bring is tobreak down barriers between ‘clients’ and service providersand make the whole relationship more ‘personal’, probablyrebranding the ‘client’ into the ‘customer’ while they do it.Q: Are ABSs a ‘storm in a teacup’ or are they here to stay?PW: The innovation and investment that will result from ABS’sentering into the legal sector will be a very welcome addition.Not all ABS applications will be successful, and of those thatare, not all will have an impact as indeed not all law firmssucceed. There are on the MoJ website around 2,500 registeredclaims companies many of whom are considering what to donext after PPI and reviewing the impact on their business of theban on personal injury referral fees from April 2013.If the lead time to become an ABS is some 6-9 months andthere are several hundred applicants already in the pipeline,then the sooner a firm or company decides the better.????? Take a scythe to non-billable hoursSurveys of at smaller law firms (less than 20 fee???????? earners) in the USA by LexisNexis have shown thatlawyers there spend between two and four hours per dayon? ???? non-billable time. According to the survey data theactivities which take up most of the non-billable time aretasks related to practice management and administration.??????? It is fair to assume that similar results would be foundfrom a survey of comparatively sized UK law firms.Two to four hours is a long time in a working day.Carrying this much non-chargeable time can becomevery expensive. How to reduce the amount of nonchargeableor ‘wasted’ time? An increasingly popularapproach is to review standard processes through thelens of a formal project management methodologywhich emphasises ‘waste elimination’, known as Lean /Six Sigma methodologies. There is little doubt that suchmethodologies, especially when applied by qualifiedproject professionals, can result in impressive eliminationof ‘waste’ and duplication so leaving more time to bespent on chargeable activities.However it is not an essential pre-requisite to bean expert in Lean / Six Sigma in order to see at leastsome increase efficiency and effectiveness as a result ofadministrative process review. You may be surprised athow far you get with an inquisitive mind, a willingness toshine light on some dark recesses of existing procedures,a determination to put in place new streamlinedprocesses and, most of all, persistence to follow through.There is no point in spending time re-designing morestreamlined practice management and administrationprocesses if they are not going to be adhered to by allconcerned. You could perhaps make a start by simplyfollowing the paper trail of a typical bill, from inceptionof the initial draft to receipt of payment; my experiencesuggests that you will uncover some inefficient practicesalong the way.‘There is no point in spending time re-designingmore streamlined practice management andadministration processes if they are not going tobe adhered to by all concerned’Over the last few years many firms have cut back onstaffing (particularly support staff) and other resources;those left in the firm are working much harder thanbefore. Some mistakenly then believe that they have a‘Lean’ law firm. Not necessarily so. Some Lean / Six Sigmaprofessionals have a saying: ‘lean, not mean’. To becomemore efficient firms need to re-design existing processesand probably change working practices. This should applyto everyone, fee-earning and support staff alike.By Antony Smith, non-practising solicitor and Director,Legal Project Management Limitedwww.legalprojectmanagement.co.ukML // November 2012

54Business SectionQ: Will the Legal Ombudsman ‘list of shame’ force lawyersto raise standards of customer service and focus efforts toeffectively deal with complaints in-house?A: Nobodycouldsensibly disputethat thosesolicitors foundguilty of providingpoor serviceshould be held toaccount. Of moreimmediate concern is the fact thatthe process, as it currently stands,is both unfair to solicitors, andpotentially misleading to those it isintended to assist.To start with, it is possible underthe new scheme for a law firm toprovide truly atrocious service, butnot be named and shamed online.Such a firm would have the chanceto settle the complaint in house, orfailing this to settle the complaintinformally by agreeing with any initialrecommendation made by the LegalOmbudsman (LeO).Complaints resolved in this ‘informal’way are simply closed at that point,and not passed to the Ombudsmanproper to make a final decision orrecommendation. It is only matterspassed through for this final decisionor recommendation that are recordedon the web site.Firms subject to serious and/or serialcomplaints as such have a chance toeffectively buy off any reporting oftheir poor service, thereby completelynegating the true value of the dataavailable to clients.Of more direct concern to solicitorsmust the fact that refusal by them, orthe complaining client, to accept theinitial recommendations of the LeO atthe ‘informal’ stage of the process, willautomatically lead to publication ofthe fact of the complaint, regardlessof whether that complaint issubsequently upheld.As a result, firms keen to keep theirnames off the published list may takea commercial decision to simply goalong with recommendations whichthey don’t actually agree with.The more serious result is that whetherthe matter progresses to the nextstage rests entirely with the client. Ifthey refuse (however unreasonably,and for whatever reason) to accept therecommendation to resolve the matterat the ‘informal’ stage, then the mattermust progress to the Ombudsman fora formal decision, with the resultantpublicity that come with it, regardlessof outcome of that final decision.The aims of this new process may belaudable, but it’s execution is poorto say the least, and looks set to bechallenged in the months ahead.By Sean Gordon, Senior Solicitor, NeilHudgell SolicitorsQ: Will the Legal Ombudsman ‘list of shame’ forcelawyers to raise standards of customer service and focusefforts to effectively deal with complaints in-house?Whether a firm is for or againstA: the Legal Ombudsman’srecently launched “Decisions anddata” complaints list, they will wantto avoid being on it - especially ifthey are serious about adhering tothe outcomes in the SRA’s Codeof Conduct 2011. It has long beenreported that many complaintsagainst law firms largely relate to failures in processes, ratherthan to the legal advice given. In the new legal era, robustcase management technology can help on three levels:At a fundamental level, case management workflowsthat underpin legal processes can help ensure clientsexperience a consistently high quality legal service andso reducing the likelihood of complaints in the first place.Thus relating to outcome O(1.4): “You have the resources,skills and procedures to carry out your clients instructions.”Firms can also revisit and widen their use of casemanagement to be more pro-active towards recording clientsatisfaction, and so helping to indentify and rectify potentialcomplaints. For example, as every matter is completed, asurvey can be automatically despatched to the client andcertain staff tasked to review and act on feedback. Also, atthe outset of the matter, the file opening process can triggeran engagement letter that includes details of the complaintsprocess, so adhering to outcome O (1.9) of the code.Resourcefully efficient firms can also use casemanagement workflow to run their actual complaintsprocess. Each complaint can be set up as a matter withappropriate workflows scripted to inform the client aboutthe Legal Ombudsman’s procedure, enabling the complaintto be tracked internally and ensuring the client is keptinformed. Thus helping to adhere to outcomes 1.10 and 1.11relating to complaints, and also demonstrating indicativebehaviours relating to Complaints Handling IB (1.22-24).As firms adapt to the new legal era, innovative firmsrealise that good case management systems are notjust for workflows around the legal matters themselves.Progressive firms are revisiting their use of workflows,to underpin wider business processes across their entirefirm, which can include complaints handling and proactivelymonitoring client satisfaction – which in turn willhelp prevent complaints, reduce the potential of being onthe LeO list and adhere to outcomes-focused regulations.By David McNamara, Managing Director, SOSwww.soslegal.co.ukML // November 2012

Business Section 55Q: Will the Legal Ombudsman (LeO) ‘list of shame’force lawyers to raise standards and what can businessdiscovery tell firms about how to complyIt has been an offence for lawA: firms to ignore their customercomplaints since Batman decidedto clean up Gotham City! But thefact that everyone within the legalsector is still talking and legislatingabout it suggests that we’re stillnot managing this process in asatisfactory and timely manner. Andwe all know how important compliance is!Suffice to say, compliance as far as COFA (ComplianceOfficers for Finance and Administration) and COLP(Compliance Officers for Legal Practice) are concernedhas certainly got everyone in the industry thinking abouthow they plan to implement their compliance proceduresbefore they become the lead in the soap opera thathas started now that the list has been published byLeO. For firms, implementing good practice aroundthe appointment of these vital people should result ina reduction in complaints and therefore prevent the‘embarrassment’ of them being named.So let’s look at an easier way to ensure complianceacross the entire firm. First, let’s assume that a firm has theright software installed to make the capture of breachesand complaint types easy to record. Most vendors ofpractice management systems have introduced specificmodules that ensure that processes can be changed, inorder to provide easier ways to introduce the complianceculture that is needed. Second, once these processes havebeen implemented the next question is to see how quicklyand easily a firm can produce the reports they need toensure that compliance is in place. It will become normalpractice for firms to review any customer complaints andensure that the management structures are in place to dealwith the complaint internally and prevent other complaintsfrom being made in the future. As the complianceprocesses that have been implemented will produce newdata, it should then become an easy task to get all the datapoints together and produce a report that everyone in thefirm can use to ensure compliance is in place.I have spoken to a number of my QlikView customersabout using business discovery software to create a‘living’ dashboard that is updated at least once a day, sothat the people who need to know about compliancebreaches are informed on a daily basis and the firm is in aposition to act before the complaint becomes an issue.By Barry Talbot, Managing Director of InformanceQ: Will the Legal Ombudsman (LeO) ‘list of shame’ forcelawyers to raise standards of customer service and focusefforts to effectively deal with complaints in-house?There is no question that seeingA: the firm’s name in a ‘list ofshame’ will be a shock to the systemfor most law firms. However, on thebasis that these lists will be releasedregularly, I suspect that the shock willbegin to wear off after the third orfourth list.Whereas there has been significantcopy written amongst legal circles,there appears to be little in the wayof public information to ensure thatconsumers are aware of the issues.This is a service that is for the use ofconsumers but I wonder what surveyshave been carried out to ensurethat the public are aware of it. Ofcourse solicitors must publicise thisinformation on retainer letters and onwebsites, but this simply gets lost inthe masses of information provided toa new client. In any event how mainlyclaimants thoroughly read the sameor even if they do retain a copy shouldthey have need at a later date.If anything I would expect thesolicitor brand, particularly inresidential conveyancing and PI circlesto take any hits on reputation in it’sstride. Let’s face it they have becomemore than used to riding with thepunches in recent times.Nevertheless, the powers that theLeO has at it’s disposal to awardcompensation will be a far moresignificant reason for law firms toensure that their internal complaintsprocedure is sufficiently robust andto invest some time effort and energyinto ensuring that their customerservice programs are effective. Withthe threats of regulatory change,Jackson and referral fee bans alllooming, I would hope all law firms aredoing all they can to keep hold of theirclients and ensure that they limit theirexposure to bad publicity.By Alan Nesbit, Managing Partner,Nesbit Law Group LLPML // November 2012

56Business SectionQ: Will the ‘List of shame’ and forced powers by theLegal Ombudsman (LeO) raise standards of customerservice work and focus their efforts to effectively dealwith complaints in-house?If you lookA: at thiswith regardsto buildinga crediblebrand, then anyregulation thatmakes a firm lookat how it deliverson its promise can only be a goodthing. In the end your firm’s brandvalues are not what you think they arebut what your clients and prospectsbelieve them to be, particularly whenthey see, hear and experience theservices of your firm. The latter is thesingle most important aspect of truebrand delivery as it’s where trust isgained and lost.Creating transparency within andabout your firm can be a good thing.It focuses the mind and will create abetter product and experience for yourclients. Many of my legal clients agreethere should be freedom of choice andaccess to information so that clientscan make an informed decision beforethey use a firm’s services. However, inan era where people are more willingto complain, the question is: are thesecomplaints justified?There are two processes to thecomplaints procedure: one, internallyto compliant partner and two,externally to the LeO. It is true tosay that often complaints receivedinternally are just an attempt to get thebill down. However a decision needs tobe made on what information is madepublic and when this information isreleased in order to provide a helpfulresource for the legal profession andclients and prospects alike.Information on matters or casesthat have been upheld either byadjudication or settled by conciliationshould be published. But complaintsthat have not been substantiatedshould not - unless they are there toshow the clear difference between thetwo. Complaints should be supportedby an overview of the firm – size beingan important factor as an indicationof the total number of fee-earnerswill provide a valuable reflection onthe proportion of claims per workflowand firm turnover. After all, threecomplaints against a sole practitionerwould reflect much more badlyon that firm than three complaintsagainst a national firm with hundredsof fee earners.By Ian Hunter, Managing Director,Jellyfish (Strategic brandcommunications)B RAND N EW I NSURANCE F ROM P RIMECOLP, COFA & EXECUTIVE PROTECTIONBy now you will have nominated your compliance officer for legal practice (“COLP”) and a compliance officer for finance andadministration (“COFA”). These new roles are compulsory and a requirement of the SRA with the COLP and COFA taking uptheir responsibilities by the 1st January 2013.Prime have developed brand new insurance policies for risks associated with the management of law firms, with coveravailable explicitly for COLPs and COFAs. These policies are specifically designed to provide the protection required as firmsmove into uncharted regulatory territory.Are you protected against personal liability for claims arising from your actions, omissions and decisions?For guidance, support and a quote please contact Helen Pells on 020 7173 2162 orZarina Lawley on 020 7173 2155 or email us at solicitors@primeprofessions.co.uk.London: 155 Fenchurch Street London EC3M 6AL T: 020 7173 2100 F: 020 7173 2101Leeds: Prospect House 32 Sovereign Street Leeds LS1 4BJ T: 0843 506 5190 F: 0113 242 5818W: www.primeprofessions.co.uk DX: 769 London/CityPrime Risk Solutions is a division of Prime Professions Limited an accredited Lloyd’s Broker, authorised and regulated by the Financial Services Authority.PPL 24407 Modern Law Half Page-1112.indd 1 08/10/2012 16:06

Business Section 57Q: Will the Legal Ombudsman (LeO) ‘list of shame’force lawyers to raise standards of customerservice and focus efforts to effectively deal withcomplaints in-house?Looking at the latest ‘list ofA: shame’ published by the LeOI notice that already for 2012 thenumber of chambers unable toeffectively process client complaintsin-house is at 50% of the totalnumber for the entirety of 2011.Whilst the actual number ofcomplaints is low (in comparisonto law firms) the ability to provide the highest levelsof customer service is becoming an essential focus forchambers, particularly for sets engaging in direct access.Chambers can ill afford the damaged reputation and badpublicity resulting from poor service levels.There is the potential for the ‘list of shame’ tobe used as a tactical marketing tool by law firms todiscourage the public from seeking direct access withchambers, thereby retaining the business themselves.To combat this, chambers need to be proactive indramatically improving their customer service. How dothey do this?Strict adherence to chambers’ client service policy andthe Code of Conduct is the bare minimum. Chambersneed to be more focused on client care by placing theclient centrally to the workings of the set.Chambers need to routinely ask for feedback fromclients and look for ways in which to improve their serviceofferings. Using programmes such as the Net PromoterScore, they will be able to focus on the parts of thebusiness that contribute to a negative client experienceand fix them accordingly. Once resolved, they needto communicate the improvements and the resultantpositive comments to all clients and the wider public.Communicating the message that chambers is seriousabout their client experience helps to retain clients,increase instructions and negates any negative spin thatcould be created by aggressive competitors.Chambers also need to take a more positive positionon the processing of complaints in-house. Appointingsomeone in chambers to be responsible for the wholeof the client experience gives focus for both the set andthe clients. This person needs the support of all membersto address the issues raised and have the authority toimplement appropriate solutions. As a result, chamberswill see their reputation for client service improve andthey will avoid any embarrassing future appearances onthe dreaded ‘list of shame’.By Catherine Bailey, Managing Director, Bar Marketingwww.barmarketing.co.ukA new era in client-centric legal servicesThe UK’s largest independent provider of legal software,Eclipse, has announced a unique new solution forlegal services organisations. Currently in the final stagesof development, ‘TouchPoint’ will provide a deviceindependent,interactive experience for legal serviceproviders, their business partners and clients, using data(taken in real-time) from Eclipse’s core Proclaim Case andPractice Management solution.Providing access to a huge range of live information,TouchPoint will provide an ‘always on, always visible’solution. Functionality will include contact management;social media aggregation; dynamic data mapping; visualKPI presentation; dynamic, fluid report / MI commissioning;targeted news feeds and blogging.The solution carries a consistent Windows 8 feel formaximum accessibility and will enable easy viewconfiguration for prioritising what is displayed, where,and how.Steve Ough, Eclipse’s Chief Software Architect, explains:“The way in which legal services are being provided haschanged.”“Clients and business partners need to have an interactiverelationship with their data. This access has to be ‘ondemand’, available whenever and however it is wanted(desktop computer, iPad, tablet, or smartphone). Legalservice providers that can provide this will win far morebusiness.”“TouchPoint puts the user (service provider, businesspartner or client) at the centre of operations and allowsthem to ‘decorate their own office’ with whateverinformation and applications they need, on the deviceof their choice. Whether it’s a law firm director checkingMI on an evening via iPad, a lawyer working in aBYOD environment or a client engaging with a blogon a smartphone, TouchPoint provides an instant andconvenient experience.”ML // November 2012

58Business SectionMan on a MissionThe mission is nothing less than to change - fundamentally change - the waylaw firms practice law. Mitch Kowalski (international innovative thinker, lawyerand writer - pictured right) has published a book which led to a stir on thelegal blogosphere, entitled: Avoiding Extinction: Reimagining Legal Servicesfor the 21st Century. The UK publication of the book was launched officiallyat Blackwell’s bookshop in London on 9 October 2012 where Antony Smithinterviewed him for Modern Law Magazine.MLM: Could you tell us a little aboutyourself and professional background?MK: I’ve had a very eclectic careerto date. I practiced law with Baker& McKenzie and Aylesworth LLP inToronto for about 13 years beforemoving to an in-house position withthe City of Toronto. I then had abusiness role in a large title insurancecompany before returning to open asmall boutique property and corporatepractice. I also write a legal blog forSlaw.ca and for the Legal Post andspeak regularly on innovation in thedelivery of legal services.MLM: How did the book come aboutand why now?MK: The book had it’s genesis in anarticle I wrote for a Canadian legalmagazine in 2009 in which I sketchedout what I thought the successful lawfirm of 2020 would look like. The readerresponse to the piece was so positiveI decided to turn the article into a fulllength book. In many ways both thearticle and the book provided me withan outlet for my extreme frustrationwith a profession that had lost it’s way- a profession that had become overlyobsessed with billable hours and profits.MLM: What are the core themes ofthe book?MK: The book is written in anarrative style - a novel. We meeta harried general counsel who isfed-up with her outside law firmsand is being pressured to do morewith less from her CEO. She callsher team together to reassess whatthey want from their law firms toallow them, the in-house lawyers,to provide better service to thecompany. Next we meet a new hireat Bowen Fong & Chandri (BFC)who is frustrated with his careerWe work with law firms to ensure compliance and optimise best practice and risk management. Ourextensive and thorough knowledge of the Code of Conduct and other regulations will ensure your law firmis compliant and your processes sound. The advice we offer is clear and practical, and we pride ourselves onour exceptional customer service and unbeatable work quality.Legal-Eye Specialises in• Best Practice• Risk Management• Compliance of the Code of Conduct, Equality Act 2010, EU Commerce Directive• Lexcel Accreditation• CQS Applications• Completion of tender responses to win new work• TCF (Treating Customers Fairly) programmes / training• Training: AML, Equality and Diversity, Data Protection, Conflict of Interests, Lexcel, The Bribery ActTel: +44 79 2177 4548www.legal-eye.co.ukML // November 2012

Business Section 59at another firm and is seeking a firm that does thingsdifferently. As he goes through his orientation we learnthat BFC has turned the law firm model upside down ina way that increases profits, stops lawyer attrition andmaximizes client retention - it has become a firm thatis greater than the sum of its parts with a corporatestructure and independent board of directors. Finally wemeet Sylvester Bowen the CEO of BFC an learn of hisphilosophy of stewardship and custodianship, his desireto relentlessly focus on ploughing profits back intothe firm to ensure that BFC is constantly improving it’sservice levels and seeking the next innovation to makeit’s services better, faster and cheaper.MLM: Your book has been published in the US beforereaching the UK. Have there been any key reactions anddifferences in reception across the world?MK: The book has been published just in the USA butdistributed everywhere on Amazon. The reaction has beenmuch more positive in the UK than in Canada and the US -which doesn’t surprise me as the UK is years ahead of therest of the world in terms of legal innovation. In Canadaand the US law firms and GCs have been polite but notparticularly interested in change.MLM: Well before the official publication date in the U.Kyour book has caused quite a stir here in the blog andtwitter-spheres. Were you surprised by this?MK: I was very pleasantly surprised and delighted! It wastotally unexpected.MLM: From your perspective, how is the liberalisationof legal services in England and Wales viewed in otherjurisdictions?MK: Unfortunately in the US and Canada, liberalisationof legal services is viewed with suspicion, particularly bylawyers. My view is that they see it as a threat to their longheldmonopoly rather than having any legitimate reason toturn their noses to it.MLM: What do you think have been the most significantearly developments of the liberalisation of legal services inEngland and Wales?MK: I think that the ABSs that have been created, especiallyRiverview Law, will radically shake up that middle band oflegal work that lies between high-end complex bespoke workand low end commodity type work for corporate clients. Thisis a market that I am watching with great interest!MLM: What general advice would you give to thosesolicitors in England and Wales now trying to survive andprosper the new regime?MK: The simple truth is that lawyers in the UK need to embracea new model and the new way of practicing law as set out inmy book sooner rather than later, because the playing fieldis shifting and if they are not part of this re-shaping they riskbeing out of a job. Tweaking things is no longer an option.Mitch Kowalski’s book, Avoiding Extinction: ReimaginingLegal Services for the 21st Century, is available via amazon.co.uk and other online retailers.Increase profit,minimise riskLooking to sell, retire or free up capital?With substantial funds available immediately to buy Personal Injury practicesand case loads of any size or type, we could have the right deal for you.Make money fast!Refer your Personal Injury or Medical Negligence leads to us on acommission basis and track the progress of your referred cases online.Sell or refer your files to us - the choice is yoursContact us todayfor a confidentialdiscussion orfree valuation,with no obligation.See detailsof our recent£1 millionbuy out on ourwebsiteContact Neil Hudgell in confidence neil@neil-hudgell.co.uk or visit www.webuyanyfiles.comWebuyanyfiles is a trading name of Neil Hudgell Limited, an established Personal Injury and MedicalNegligence practice seeking growth through acquisition.ML // November 2012

60 Business SectionDesigns on a tribeModern Law speaks to a series of experts from leading outsourced providers to find out if the new legal landscape and therise of the ABS will see more firms build a tribe of back office suppliers to gain a commercial edge.Financial, big brand competitionand legal reforms put increasingpressure on many firms – puttingthose with the commercial advantageahead of the game. In the bid to runand maintain a highly successful firm,that advantage often comes downto price, particularly in terms of backoffice functions and supply.Outsourcing also gives firms thecapacity to pay suppliers based onlyon requirements, rather than a fulltime wage. Some larger law firms areeven getting in on the game, supplyingback office support to smaller firmsthat don’t have the capacity to handleadministration or lower value claims ona widespread scale.Mr. Rakesh K Sharma, CEO, Draftn Craft Legal Outsourcing, explains:“ABS has brought with it the needof more financial investments andpartners and tie ups with outsourcingcompanies to sustain in the currentmarket. 15% of the law firms in UKare already outsourcing. This numberis bound to grow with the changeswhich have come in.”Mr Sharma adds that the changing landscape for lawyersmeans that those setting up new entities and ABSs ‘to joinhands with outsourcing companies at the very beginning tobecome partners for growth.”Skills bankBeing able to dip in and out of outsourced services allowsfirms to be able to invest in highly skilled experts, cuttingedge technology or systems that allow for faster, moreeffective case management solutions that firms couldn’tjustify supporting or creating in-house.As Kate Oliver, Director, The John M Hayes PartnershipLtd explains: “In our area of expertise - legal costs - weknow from experience that overheads are reduced, profitsincreased and cash flow improved by outsourcing this workto a knowledgeable fully trained costs team.“Firms gain time to focus on new and existing businesswithout losing fee-earner time dealing with matters withwhich they may be unfamiliar and freeing up thinkingtime to innovate and make better business decisions.Outsourcing means that firms pay for high quality serviceson demand. There is no employee burden: sick pay, nationalinsurance, pensions, holiday pay or training costs, no staffretention plans, succession issues firms also free up valuabledesk space providing an opportunity to recruit fee-earnersor to reduce your office space,” she adds.Global deliveryLike it or not but the legal market is a global collaboration.As Allan Carton, Director of Inpractice explains, providersof managed and hosted IT services ‘have been able toradically reduce their costs by use of virtualisation to makesystems easier to manage, with some hosted providers nowreducing their own hosting costs by up to 50% throughthese improvements’. These are then passed on to thebusinesses that use their services.So, for LPOs such as Draft n Craft, IT has made it feasiblefor operators from an organisation sitting in Ahmedabad orBelfast to work as an integral part of a law firm in Manchesteror London and to cope with compliance requirements.Has the shifting market and ABSs changed theface of outsourcing?Allan believes: “Outsourcers have improved because bettertools have become available and they’ve learned fromexperience to use them more effectively. That’s where theirbusiness priorities are focused – which is not true of law firms.“The various ABSs in the private client sector are alsopromising reduced prices and better value, to whichlaw firms must – and can – respond. Lawyers have to beprepared to change the structure of their business to find thebest way to deliver better value to clients; and that meansthat many should look very closely at what they do best andwhat they can do to improve the areas they could do better –opening their mind to very different ways to improve.”Kate agrees: “In these changing times it pays to developstrong working relationships finding outsourcing partnerswho can help you build your business”.Catalyst to your Growthwww.draftncraft.comSolutions for Legal Research | Legal Drafting | Contract Outsourcing | Legal Transcription | Paralegal ServicesML // November 2012

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62Business SectionCompulsion to mediateMost mediators would like partiesto come to the table voluntarily.Forcing them to try mediation isn’t afrightfully good idea as it might dentthe very high settlement rate. Recentmoves to make mediation compulsoryhave produced some surprising resultsin the small claims courts across theland with a settlement rate of over90%. In family mediation it is now virtually a pre conditionto try mediation very early on. Why does it work there, yetmost commercial mediators aren’t keen on forcing partiesto mediate.Empowering controlYears ago Leonard Riskin wrote that ‘mediation coulddo much to improve the quality of life in our society, notjust because of the savings it brings, but because it fostersinteraction among people, and empowers them to control theirown lives’. If in part a lawyer’s role is to encourage dialogueto encourage settlement so that their clients achieve anearly, satisfactory and relatively inexpensive resolution thatis their own and not an imposed one, why should therebe any drawbacks to forcing them to try mediation? Whyshould the courts not impose hefty penalties against partieswho refused to try mediation when they perhaps shouldhave done, a la Dunnett v Railtrack and Burchall v Bullard?‘If in part a lawyer’s role is to encouragedialogue to encourage settlement...why should there be any drawbacks toforcing them to try mediation?’Parties have an inalienable right to self determination. Inone mediation, the Claimant turned down a very generousoffer from the bank with the words ‘I’ve got my rights’.Well he did indeed and it wasn’t my role to prescribewhat he could do with that! But he wasn’t coerced intomediation nor was I prepared to say directly he wasfoolish. The court could not apply the unreasonable refusalto mediate as he did get there. Dyson LJ’s dicta in LordMalmesbury v Strutt and Parker that the courts shouldknow and punish a party behaving unreasonably in themediation would not wash as it was all confidential. Buthaving said that solicitors should give appropriate adviceand encourage using mediation as it is so often moreappropriate more holistic than the alternatives.Anthony Glaister MCIArb, resolve@anthonyglaister.co.ukQ: Are legal marketchanges creating newprocurement andoutsourcing models?If the harsh realities ofA: being competitive in atough market are not enoughto spur firms to look at theirprocurement and outsourcingpractices, increased competitionfrom new market entrants willmake this essential. However goodprocurement is not just an issuefor ABS’s and newly merged ‘super-firms’ but a criticalissue for firms of all sizes.The changes taking place are profound. Long goneare the days of the commercial rep visiting everylaw firm in town in a single day - taking orders whileconsuming copious amounts of coffee (one benefit =reduction on the coffee bill!).As professionalism has increased firms aren’tjust relying on their own facilities management andprocurement teams but also looking outside forexpertise. This expertise comes from cost reductionconsultants with their finger on the pulse of the bestsources of supply or directly from large outsourcedsuppliers, such as Oyez Office Team. These suppliersproduce guaranteed savings by consolidatingpurchasing across multiple supply areas – or likeWilliams Lea and Mitie - are able to take over backoffice functions and undertake facilities management.Even innocuous looking areas such as archive recordsstorage have pitfalls for the unwary. It is commonto talk to firms who wish to change suppliers whodiscover onerous clauses in their contracts. In one casea £300,000 exit penalty to move archive supplier withan annual contract value of £50,000. The lesson is tosupervise the signing of any long term contract.Another way firms reduce their costs is by tenderingoutsourcing contracts and procurement requirements,increasingly common amongst merged larger firmsbut even smaller firms are getting in. Tenders arebecoming more onerous, putting potential suppliersthrough their paces. This ensures the supplier has thelowest total cost of supply and that compliance and riskmanagement issues are assessed.However, the more onerous the tender, the moredifficult it is for the firm to manage the process.We have seen tender processes which must equalthe recent West Coast mainline fiasco - and we allknow what happened to that! A balanced approachto procurement and outsourcing is usually the rightapproach for law firms, but the choice of doing nothingis not really an option.By Nick Hodges, Managing Director, Oyez Office TeamML // November 2012

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