Is everything in the garden rosy?

By | 8th November 2011

Not if your garden is in Greece! The latest news suggests that horticulture in that part of the Mediterranean must be very tricky. Drought conditions prevail and the plants are looking a trifle sickly.

It is not much better further along the Mediterranean either with Berlusconi withering on the vine, Zapatero running for cover (elections in Spain have been announced early for 20th November) and Portugal assumed to be every bit as badly off as the others.

And that is before we come to our own rather parched patch in the UK to say nothing of the swathes of desert in Ireland and the increasingly bare ground in France, Belgium and the USA.

One of the few verdant areas in the financial garden is Germany but the indigenous gardeners are not keen on lending out their watering cans and still less their extra produce to sustain less fortunate horticulturalists.

At risk of mixing my horticultural and meteorological metaphors it seems that even clouds that bear no rain can have a silver lining, as reported in an article in The Lawyer a few weeks ago – [UK Litigators cash in on rise in international work, Joanne Harris, The Lawyer, 12th Sept, 2011]. Apparently, Norton Rose posted a whopping 144% increase in litigation turnover in the past 12 months, doubtless aided by mergers, whereas Eversheds topped the list of the others by posting an increase in turnover of almost 40% taking the firm to just outside the top ten group of firms who each turn over in excess of £100 million in litigation activity.

More modest returns are the norm outside these two with a clutch of firms returning percentage increases between as little as I-2% to DLA’s 14%, Linklaters’ 15.6% and Clyde & Co’s 16.8%.

It seems there are a number of factors at work here. Joanne Harris suggests that, based on information from managing partners and heads of litigation, prominent amongst these are:

  • International networks are a source of litigation work and more law firms have international offices than previously.
  • Non UK firms are happily using the English courts and English law to resolve their disputes.
  • Recent decisions by Mrs Justice Gloster in Pioneer Freight Futures v TMT Asia and Briggs J’s judgment in Lomas v JFB Firth Rixson Inc have helped to clarify our complex financial services law relied on by others around the world.
  • The growth of regulatory work and mediations.
  • The increase in international arbitration: think Paris, yes, but Singapore is fast becoming a “go to” centre for arbitration (often involving English Law) and the Middle East is booming as arbitration becomes an acceptable way to resolve disputes there.
  • Mergers, which are increasingly likely to bring benefits of size and reputation (e.g. the merger between Clyde & Co and BLG).

So is it all rosy in the lawyers’ garden?

Possibly, although cost remains an issue. It is now widely recognised that the cost of litigation needs to be reduced and it is particularly pleasing that that message appears to be accepted across all kinds of law firms now. Part of this is due to rule changes, such as the Practice Direction 31B and the Electronic Document Questionnaire and part is due to client pressure. It is also due to the increasingly sophisticated technology available in the area of predictive coding and similar developments in collections (eg from back up tapes previously thought to be likely to be disproportionately expensive and time consuming).

Firms are also turning to the third party litigation funding market where we have seen increased activity over the past 6 months and which can only become more important as the reforms proposed by Jackson are implemented (such as the non recoverability of success fees)and initiatives such as the Birmingham TCC pilot of a cost management scheme which is likely to be rolled out to other courts.

Ian Gray of Eversheds says that 2012 to 2014 looks “pretty tasty” and DLA’s Stephen Sly thinks that “there’s not been a better time to be a litigator in a generation.”

And yet, and yet, why do I feel that all this seems a tad frothy? The only reason I can currently think of as the clouds of impending world economic ruin swirl about our heads relates to the lack of people suitably qualified and available to handle all this litigation.

Law firms have cut their staff over the past three years and I imagine they are not keen to reverse that particularly expensive trend. But if there are so few training contracts about, how is the next generation going to learn? Contract lawyers do not appear to have taken off in this country and outsourcing of review work to India and the like has had a mixed press. May be Allen & Overy and Herbert Smith are on to something with their new Belfast based projects about which I have written before.

In my own field of litigation support services we would happily hire more staff such as project managers if we could find any suitably qualified. There is a real lack of good industry professionals out there and we find ourselves constantly looking for people. We are in fact what my fellow directors call “resource challenged” and if that particular little black cloud on the horizon were to blow up into something more serious or prolonged I could see real problems in future whether in litigation support or in the law.

It is not only in the law that there are skills shortages. Recently, we have housed a succession of students in our offices undertaking the time consuming, manual and tedious task of sorting through records with the aim of putting them in a sensible sequence to enable them to be understood intelligently when scanned and coded. Why they could not have been kept in proper order beforehand, I have not yet discovered.

The current crop of workers includes Alice and Kimberley who are from Australia. Little did they suspect that part of their time in the UK would be spent sorting through records from a variety of organisations round the country merely to put them in order so that they could be scanned.

I am not convinced that Alice and Kimberley think that the garden is entirely rosy in this regard but who else is going to perform this necessary if mundane task? This is the problem and I do not see any quick or easy solution to it. It is a problem of supply and demand and in the case of the lack of suitably qualified and available project managers there is demand but no supply.

Having said that, Alice and Kimberley have both added a dose of Antipodean good humour to what can only be described as a tiresome task but it is hardly what they were trained to do.

That mismatch seems to me to be all of a piece with my rumination that a lack of suitably qualified and available staff can cause a problem in whatever field of engagement you may choose

So is everything in the garden all rosy? I leave you to judge but I have my doubts!

Photo credit: Copyright (c) 123RF Stock Photos