Guest post asking and tackling the question “is it now better to be a non-lawyer in the legal services market today?” (Applicable mainly to England & Wales)
Let’s go back in time, 20 years back in time.
Becoming a solicitor or barrister was a much sought after qualification and profession. Whilst the training, 3 years after University for solicitors or 4 if you didn’t have a law degree, was long and quite difficult, becoming a solicitor offered an excellent career with kudos, on the whole a high standard of living and a fairly safe career through to retirement.
Clients generally respected lawyers and didn’t look elsewhere for legal advice and, on the whole, respected the fact that legal fees appear expensive because they get a very high degree of expertise.
Those days are long gone.
On almost every measure of becoming a solicitor described above, save for a diminishing minority in the biggest firms or in niche areas of law, almost all the benefits described above either already no longer apply to the same degree or are eroding rapidly.
No sympathy – it’s just sour grapes ?
Many individual and even business clients have little or no sympathy for lawyers on the basis of a belief that lawyers had it good, almost like bankers, for so long, and they may say got away with charging a lot.
They also may say that it’s the lawyers own fault for not moving with the times. The mystique of law is disappearing fast, intractable and expensive legal tomes are no longer the same barrier to widespread knowledge due to the internet and technology is reducing the need for bespoke legal services in some areas of law.
In some ways, clients may be partially correct, especially regarding the slow pace of many lawyers embracing technology or at least acknowledging that some legal work can be process driven.
In any event, the bottom line is that client is now king and whether lawyers like it or not, clients don’t see legal services, for many areas of law, the same way that lawyers do.
In defence of lawyers
What clients don’t see or often appreciate is that a large part of many lawyers current anger or frustration is caused by the fact they are not, and have not been, working in a level playing field environment for some years.
Solicitors and barristers are very heavily regulated, with a view to protecting the public. Solicitors must have very expensive professional negligence cover and spend many thousands of pounds on compliance and ongoing training every year, all for the benefit of protecting clients.
The above is set against the context that, in reality, there are few areas of legal practice where solicitors know that this investment in remaining a solicitor carries benefits of being the only business able to provide legal advice. In other words, there are very few remaining areas where legal service is “reserved” for lawyers only.
Reserved legal matters – becoming irrelevant ?
The list of types of work where only solicitors are supposedly legally able to advise clients in England & Wales have been reduced to :-
- the exercise of rights of audience (ie appearing as an advocate before a court);
- the conduct of litigation (ie issuing proceedings before a court and commencing, prosecuting or defending those proceedings);
- reserved instrument activities (ie dealing with the transfer of land or property under specific legal provisions);
- probate activities (ie handling probate matters for clients);
- notarial activities (ie work governed by the Public Notaries Act 1801); and
the administration of oaths (ie taking oaths, swearing affidavits etc).
Even in these areas, in reality, reserved does not always mean exclusive – take probate, banks offer probate advice.
In a very real sense, the concept of “reserved” legal matters is now perhaps completely redundant.
For example, what’s to stop a business client deciding to have a contract drawn up by a large Legal Process Outsourcing company in India that is staffed by lawyers there ? Despite the fact that we can jump up and down and say that’s a very bad idea, that even an experienced Indian lawyer is not the same as an English lawyer practicing English law all their career, in reality, there’s nothing to stop this happening and it’s just one example of what’s likely to happen in the future based on technology advances. So, reserved legal services are not a compelling reason to be a solicitor.
We’ve established that being a solicitor isn’t the career it used to be. Fair enough, you takes your chances ….. but hang on a minute, there’s more to it than that.
Are there in fact advantages to offering legal services, whilst in fact not being a solicitor ?
There certainly appear to be.
Without the problem of regulation, without the costs of insurance, possibly there’s an opportunity to grab a large part of the legal market and either service it or sell it back to the lawyers. In fact, that’s exactly what’s been happening, with the rise of legal brokers and those offering legal services as non-solicitors.
The above all started with the Claims Direct model in Personal Injury, by a solicitor who realised the opportunity and acted on it. It has continued, in one form or another since then, especially in the PI sector.
Recent developments illustrate this particularly well and show why many lawyers are so angry.
Most agree that the personal injury market has got out of hand and that there has been quite widespread unethical behavior. Whiplash claims have risen out of all proportion to accidents, lawyers have been paying hefty referral fees for claims to insurers and claims management companies, marketing methods have been intrusive and exploitative.
Most would agree that whilst some personal injury lawyers are not blameless, all of the above have involved a degree of collusion between insurers, claims management companies, lawyers and a large number of the public.
Something had to be done.
In fact, what is being done is essentially to blame the lawyers and let all the other participants not only off the hook, but perhaps to even benefit at the lawyers expense.
The referral fee ban coincides with the advent of Alternative Business Structures, allowing non-lawyers to buy into law firms. You’re a claims management company – you know that lawyers can no longer pay you for referrals. You have a good amount of money in the bank from selling claims, perhaps claims derived using heavy handed marketing tactics. You know that the personal injury market is about to become even more cut throat.
So what do you do ?
You buy into a law firm, take control of it and outmuscle the smaller remaining personal injury law firms. Is that really fair ? Is that a level playing field ?
Is a perfectly rational question for lawyers to ask themselves – am I better off, in business terms, not being a solicitor ?
This post courtesy of Evolved Legal, specialist legal marketers who work with dynamic law firms including Gannons Solicitors.