BUSINESS
CAREERS
U.K. taking a
‘leap of faith’
Meanwhile, Canadian law
societies are waiting to see
where their colleagues land
MATT LAFORGE
Imagine a future in which law
firms had to compete with
department stores—in which a
person could pick up a draft of
their will at the same store they
picked up their dry cleaning; in
which investors could buy shares
in law practices. In the U.K.,
thanks to its Legal Services Act —
a piece of legislation that is
surely trending at a watercooler
near you — the future is now.
What does Canada’s future
look like?
For as long as anyone can
remember, the law of this land
has required that legal practices
be owned by lawyers. The rationale is long-standing and well
understood: legal fees must flow
to lawyers because lawyers’ professional standing is bound up in
protecting clients’ best interests.
Anyone for whom this is not the
case can’t be trusted to put the
profession’s core values of duty
to the client, impartiality and
confidentiality before profit.
But law societies across Can-
ada are now being forced to re-
evaluate this article of faith. The
Legal Services Act, which has
been trumpeted in some quarters
as the legal world’s ‘Big Bang’,
permits non-lawyers to own law
practices. Firms in the U.K. will
be able to raise money by selling
equity to shareholders. Compan-
ies that have had nothing to do
with law will be able to hire law-
yers to provide legal services.
Within two weeks of the early
January application period open-
ing, 65 firms and non-legal com-
panies had applied to the UK’s
Solicitors Regulation Authority
to convert to an alternative busi-
ness structure (ABS).
ZTEVE JOHNSON / DREAMSTIME.COM
We remain somewhat
skeptical that
alternative business
structures can
improve services.
“
Gavin Hume,
Law Society of British Columbia
are employed under some version of ABS. But to date only one
firm, Slater & Gordon, has made
a public offering of its shares.
The New South Wales Legal
Services Commissioner worked
closely with Slater & Gordon to
ensure its shareholder agree-
ments provided that the firm’s
duty to court and clients super-
seded its obligations to make
disclosures to shareholders.
Ken Fowlie, the firm’s executive
director, recently told the New
York Times that “if anything,
going public has increased
transparency” because it has
separated the ownership from
the lawyers, who are better
insulated from financial pres-
sures than they were under the
old system. And, not for noth-
ing, Slater & Gordon’s revenue
has tripled since 2007, when it
listed its stock.
