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‘Very big, catastrophic failures’ over next 12 months, APIL president predicts

Stockwell concerned at SRA's lack of resources to monitor conflicts of interest

20 November 2013

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There will be some "very big, catastrophic failures" of law firms over the next 12 months, Matthew Stockwell, president of APIL has warned.

"We will see some massive interventions and horrible messes, like other parts of the financial services sector," Stockwell said.

Speaking at a joint APIL, MASS and FOIL conference in London yesterday, Stockwell said he was also concerned about the "lack of resources available to the SRA" to monitor conflicts of interest within ABSs and a lack of transparency for clients.

"Will we see these conflicts emerge too late to stop people being affected?" he asked.

Stockwell said all personal injury practices needed to be run with a "much more commercial focus" to them.

"There are tremendous opportunities for more efficiency and greater use of technology," he said.

"However, there is an irreducible minimum of legal expertise you need if you market yourself first and foremost as lawyers."

Meanwhile Rod Evans, president of FOIL, said he agreed with advice from David Marshall, first reported in Solicitors Journal, that claimant personal injury firms should 'get big, get niche or get out'.

"If you're not a niche player, you need to be big to be able to compete over the next couple of years," Evans said.

"What will happen on the claimant side is exactly what happened on the defendant side, only to a greater extent.

"We were forced to change. We were told what to do and at what cost. Insurers started cutting panels, the rates came down and that was driven on relentlessly.

"Businesses that didn't use IT or keep up standards got kicked off panels. Only the leanest and meanest survived.

"As soon as you improve your level of service, it's taken for granted and they want to know what else you're going to improve - that's part of the society we live in.

"Now you want to touch a file as little as possible, rather than as much as possible, and get the case concluded."

Evans said firms had to "know their business well" to know how low to bid, but he did not agree with people who saw the situation as a "race to the bottom".

He added that over the next 12 months the independent personal injury bar would shrink "quite quickly", while, as far as law firms were concerned, "market leaders will emerge and the way services are delivered will change".

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