“All Change or Not” The Bar’s Roadshow hits York.
NIPC Law blog
On 30 Oct 2007 the Legal Services Act received Royal Assent. Part V of that Act provides a legislative framework for legal services including advocacy to be offered by businesses consisting of lawyers and non-lawyers. Since 31 March 2009 the Solicitors Regulation Authority (“SRA”) has allowed solicitors to practise in partnership or other association with barristers, patent or trade mark agents and other legal service providers and some non-lawyers. Such practices are known as “legal disciplinary practices” (“LDPs”).
Paragraph 205 of the Bar’s Code of Conduct precludes barristers from participating in LDPs except as employees unless they re-qualify as solicitors as that paragraph prohibits counsel from practising in partnership or companies either with solicitors or even with other barristers. However, on 20 Nov 2009, the Bar Standards Board (“BSB”), the Bar’s regulator, proposed changes to the Code to permit barristers to:
- become managers of LDPs, regulated by the SRA without having to re-qualify as solicitors;
- practise in more than one capacity at the same time e.g. as both managers of LDPs and as independent practitioners;
- form barrister-only partnerships (BoPs), pending the creation of an appropriate regulator for such entities,; currently not in existence, and consultation by the BSB in relation to becoming such a regulator; and
- practise through other barrister-only companies and limited liability partnerships (LLPs).
To bring those proposals to the attention of practitioners and discuss their ramifications, the Bar Council and BSB are holding seminars on each Circuit between 11 Jan and 2 Feb 2010 called “All Change or Not”. My chambers manager and I attended the seminar for the North-Eastern Circuit in York on 19 Jan.
The York seminar took place at the station hotel and was addressed by the Chair of Bar, Nicholas Green QC, and Sarah Brown from the BSB. Given our well deserved reputation for cussedness (you can always tell a Yorkshireman but you can never tell him much) the speakers may well have expected a rough ride. In the event, they were treated with great deference by the audience except by me. Probably the reason for this is that they pressed all the right buttons. For example, Nicholas Green told us that barristers were on average 20% cheaper than solicitors because we did not have to carry their overheads and that solicitors had probably suffered more from the changes to legal aid fees than had barristers.
While emphasizing that barristers would be free to take advantage of the proposed changes or leave them Green suggested four possible options:
- members of chambers or other groups of barristers could form companies (referred to as “ProcureCos) which could bid for civil and criminal legal aid contracts from the Legal Services Commission (“LSC”) and other work and distribute it to the members and their pet solicitors;
- barristers could become managers of LDPs;
- barristers could practise part of their time as employees and part of their time as self-employed practitioners; or
- barristers could form barrister only partnerships.
A handout to delegates explained that ProcureCos could be formed at once under the existing rules whereas practitioners would have to wait for the other proposals to be approved. Since the LSC is expected to invite tenders for block contract work in February, the audience was urged to get a move on with setting up ProcureCos otherwise solicitors would scoop the pool.
Sarah Brown, one of the lay members of the BSB, announced a whole slew of other proposed changes to the Code including the following:
- counsel instructed under the Public Access Rules will be free to conduct correspondence with solicitors, interview witnesses and settle witness statements;
- the Public Access Rules will be amended to allow barristers to accept some criminal, family and immigration work without the intervention of a solicitor or other professional intermediary;
- barristers will be free to attend police stations and interview clients there; and
- the prohibition on barristers sharing accommodation with solicitors will be scrapped.
As a clear distinction is drawn in the Legal Services Act 1990 between advocacy and conducting litigation I could not help pondering whether some of these changes were actually within the BSB’s gift since collecting evidence and conducting correspondence strike me as conducting litigation.
Such thoughts prompted me to ask the first question which was in two parts:
(1) how can a ProcureCo contract for work and sub-contract it out to pet solicitors and members of the syndicate without holding clients’ funds which has always been forbidden; and
(2) if such companies were to manage client funds, how could barristers maintain the 20% cost advantage that we had been told that we enjoy since ProcureCos would require the same sort of accounting systems, bookkeeping staff and premises that solicitors appear to need, all of which cost money?
“Good question” mused Green before telling us that he did not think that a contract for say a million pounds payable quarterly really meant holding clients’ funds and that he was sure that our costs ought to be lower than solicitors’. It would be wonderful if he is right – especially as I had to withdraw from a panel to provide business support services to new businesses in Bradford funded by the Local Enterprise Growth Initiative last year because the work would have required my instructing patent and trade mark agents – but the advice that I received at the time from the Bar Council was to the contrary.
The only other bolshie question came from Ian West from Middlesbrough. “You all know me” started Ian (though to be quite honest I did not know him) “as I’ve served on the Bar Council.” He continued that he believed he represented the views of criminal practitioners who made up two thirds of the Bar. Ian could see nothing in the proposed changes for him or for other criminal practitioners whatsoever. He explained that solicitors get work through branches in every city and town in the region which enables them to attend police stations and mingle with the public. ProcureCos can’t do that, said Ian. He feared that the reforms would accelerate payment on the basis of one case one fee instead of ring fenced advocacy fees and our bidding for work through ProcureCos would alienate solicitors. The Chair did not really answer that question beyond re-stating that barristers like him were not bound to change their working practices if they did not want to do so and that there would be an end to ring fencing whatever the Bar did. On reflection, I am not sure that the criminal bar could not compete with multi-branch law firms. I get work from running inventors’ clubs in Leeds, Liverpool and Manchester and intellectual property clinics throughout the North. Could other barristers not work with local law centres, citizens’ advice bureaux and other local organizations in providing some pro bono services as loss leaders? Just a thought.
The meeting in York took place less than a week after Jackson and yet not a word was said about the report. That was amazing since Jackson is concerned with costs and the whole point of the 2007 Act is to stimulate competition in the legal services market and so force down costs. A few days after the seminar I attended the Chancery Bar Conference at Regents Park where both the Chancellor, Sir Andrew Morritt, and the Vice-Chancellor, Mr Justice Morgan, gave pretty strong indications that the Jackson recommendations are almost certain to be carried out whichever party wins the next general election. They have to be because we as a profession are pricing ourselves out of the market. Change is coming whether the Bar likes it or not and with all due respect to our eminent Chairperson I think we will have to do more than set up ProcureCos.
27 Jan 2010