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Jean-Yves Gilg

Editor, Solicitors Journal

East Anglia: all change

East Anglia: all change


Despite escaping the worst effects of the downturn, changes in the legal and economic climate have encouraged East Anglia firms to review their strategies and explore new avenues to prosperity. Jean-Yves Gilg reports

East Anglia has been lucky. This time last year the credit crunch was merely brushing past the region. With no heavy industry to speak of, it also seems to have escaped the more brutal effects of the recession experienced in other parts of Britain. Could it be that, immutable as it is depicted in ITV’s series Kingdom, legal life in East Anglia has just carried on in the way it has for generations, untouched by the economic maelstrom?

Firms in the south of the region, those closest to London, the epicentre of the economic earthquake, were the most exposed to the tremors. They have undoubtedly suffered but appear to have resisted remarkably well.

With 16 partners, 37 fee earners and a total staff of 97, Fisher Jones Greenwood, in Colchester, is one of the largest firms in the area. It offers the whole spectrum of services to individuals and businesses, and even derives about 35 per cent of its revenue from legal aid.

Property work and transactional work generally have been down but, with litigation representing 65 per cent of its turnover, the firm has been comparatively well placed to weather the downturn and, conveyancing excluded, revenue has gone up ten per cent in the past year.

Some sectors have done particularly well, such as immigration. The firm’s commitment to legal aid has also helped but managing partner Tony Fisher is unsure about the future. The firm is one of the larger suppliers in the area, and it is the only provider for welfare, but Fisher says continued involvement will depend on the terms of the new contracts and whether they are sustainable.

Disciplined approach

One thing that legal aid has helped with though is the discipline it imposes on providers. “With legal aid you have to be very disciplined; this approach then tends to apply in other areas,” says Fisher. “It helps to run a tighter ship, and that’s invaluable in difficult times.”

Cross the border with Suffolk and move to Ipswich and the picture begins to change.

Thirteen-partner firm Gotelee and Goldsmith reluctantly abandoned legal aid three years ago, only retaining a franchise for crime and mental health.

A full service practice with a strong reputation in road traffic accidents, employment and planning, the firm has otherwise steered through the downturn. Family work is up, so is personal injury, and contentious commercial work is particularly busy with a steady flow of claims for breach of contract, failures to pay and debt collection. Even residential property is beginning to move, with the market for properties under £300,000 being quite buoyant, according to head of commercial litigation Jonathan Ripman.

On the transactional side, commercial work is slowly picking up but remains hesitant. “Things are generally starting to bubble but it takes a long time for transactions to come through,” says Ripman. “Sometimes you do a lot of running around but nothing comes out of it in the end.”

Farmers to the rescue

As one moves further north, the more obvious it becomes that East Anglia has remained a rural economy and what a significant source of work the farming community is for law firms.

Jonathan Ripman, for instance, says that Goletee and Goldsmith’s private client department has continued to do well and has been the busiest team in the firm, mostly because of the regular flow of work in agriculture-related matters.

In Norfolk, Iain McBryne, senior partner at 11-partner Hayes and Storr, reports likewise a steady stream of farming work, fuelled in part by the rise in food prices.

“We’re still seeing a good number of sales of whole farms, either following a death or as part of reorganisations between family members,” he says. “Then there are farmers buying neighbouring units to increase their farming capacity – there certainly seems to be a move towards larger units.”

Like Jonathan Ripman in Suffolk, Iain McBrayne says that the property market and commercial work are picking up in Norfolk.

“Property suffered in the autumn but there has been a marked surge in the past few months,” he says. “Sales that were stuck in the pipeline have started moving after sellers accepted more realistic prices, and generally there is a feeling that prices have stabilised.”

On the commercial side, McBrayne says that local entrepreneurs and SMEs have kept the local economy moving, in particular restaurants and other tourism-related businesses, including a few entrepreneurs who have bought up and pubs and started small restaurant chains.

Back in Suffolk, Gross and Co., a six-partner firm in Bury St Edmunds, also has a stable farming client base which, together with local SMEs, has helped keep the firm’s fortunes up. But perhaps Gross’s best anti-recession recipe has been its focus on niche markets: the medical profession, and specialist immigration work.

Choose your niche

Gross and Co.’s senior partner Graeme Kirk is a well-known corporate immigration specialist, taking instructions from clients, usually high earners, looking to secure work permits. As in the case of Fisher Jones Greenwood, this sort of work has continued unabated. As a firm though, Gross and Co. is possibly better known for its specialist services to the medical and dental professions; advising on partnership agreements, employment matters, merger and acquisition in the profession. It even has a small base in London’s medical heartland off Harley Street.

Morgan Jones and Pett, in Norwich, has gone one step further, almost moving to a different business model.

Founded in Great Yarmouth in 1975 the firm has evolved from a generalist practice with nine partners to a lean three-partner operation, abandoning legal aid along the way and focusing almost exclusively on personal injury and clinical negligence.

“We saw the writing on the wall and had to adjust very rapidly to the ‘no win no fee’ regime,” says managing partner David Jones, who comments in passing that conditional fee agreements have not necessarily served the public, as lawyers have had to become very selective about the cases they would take on.

But despite announcements last week by the National Institute for Economic and Social Research that Britain has started easing itself out of the recession, the mood in East Anglian firms remains mixed.

Some way to go still

Gross and Co.’s managing partner Nick Amor says that his firm remains one of the most profitable in Suffolk but that even they took a hit this year.

At the beginning of the year the firm froze its charge-out rates, a few support staff were made redundant, and the firm’s trainee, who qualified in the family department, was moved to private client.

So worried was Amor about the future earlier this year that his strategic plan for the partnership included a disaster contingency plan including the possibility of another round of redundancies, merging with another firm, and releasing some of the equity in the freehold of the firm’s premises.

Thankfully, Amor says, things turned out a lot better. The firm’s figures have returned to a more promising level, and staff were even paid performance-related bonuses earlier this spring.

“There is less uncertainty now than at the beginning of the year,” says Amor, but at Gross and Co. as well as in other firms, the main effort is on marketing.

Networking at local seminars is one option, b ut some firms have also invested further in their web presence. Morgan Jones and Pett is seeking to attract more claimants to the firm via its website by keeping it as user-friendly as possible for the general public, while Fisher Jones Greenwood recently relaunched its website to cater for its broad client base. In difficult times, managing partner Tony Fisher sees this as an absolute priority.

“We were one of the first firms to have podcasts,” says Fisher. “We also make sure the content is kept up to date, and traffic is monitored.”

But is it so essential for a firm like his to invest so much effort in its web presence? “It really helps,” Fisher continues. “Individual clients or businesses normally come to us recommended but these days the first thing somebody does before acting on a recommendation is go on the internet to check the firm’s website, so it’s quite important that our site should be as convincing as possible.”

Fisher also believes that showing your commitment to certain values will make you stand out from the rest. “We have been doing a lot of rights-based work and have been socially responsible long before it become fashionable,” he says. “Now these values are becoming important to more people, including business clients, and it makes sense for us to talk about these.”

Over at Gotelee and Goldsmith, Ripman is also proud that the firm is a founding member of the Legal Sector Alliance, a grouping of law firms committed to reducing their carbon footprints, reduce their impacts on the environment and generally promote greater awareness of climate change.

But will such moves be sufficient to tackle the deeper trends in the market?

Turning points

As in most other regions, law firms in East Anglia are watching the developments taking place under the Legal Services Act with a combination of curiosity and concern.

“There is no doubt that in four to five years our traditional high street areas will be challenged by new entrants with deep pockets,” says Tony Fisher, before adding that his firm is already considering alternative revenue streams, such as international work.

Gross and Co.’s Nick Amor is more sanguine. “The silver lining of the recession is that the big players such as Tesco will think twice before they move into the legal market,” he says. “The work they are likely to consider viable for them is one which is the most under pressure.”

There could also more fundamental changes afoot in the market, with mergers already taking place and many predicting more.

“East Anglia generally and certainly the area around Colchester is quite fragmented, with a number of smaller firms,” says Tony Fisher. “Merging can be a dangerous strategy; many firms merge because they think they have to, without properly working things out, but it’s almost inevitable that there will be more consolidation.”

Jonathan Ripman agrees, saying that rural Suffolk is home to a plethora of smaller firms with ageing partners with no obvious succession plans, and that this will offer opportunities for alliances.

Then there is Eversheds’ decision to close its Norwich office, a move that could be the forerunner of structural transformation to come in the local legal scene.

Within the past 12 months, 39-partner firm Birketts has opened a private client department in Cambridge, moved its Norwich office to larger premises, and absorbed most of Eversheds’ private client team, clearly setting a challenge to larger players such as Mills and Reeve.

However, Birketts’ plans started taking shape well before Eversheds left Norfolk. Initially based in Ipswich, the firm opened in Norwich seven years ago with four partners from Eversheds when the national firm’s interest in the region started to wane.

Having grown the Cambridge branch in a notoriously crowded and competitive environment, the firm now has its eyes set on opportunities further out still. “Our underlying strategy is to become a leading regional firm,” says managing partner Nigel Farthing. “We are now looking at possibilities in Essex and Hertfordshire.”

Eversheds’ move could also be beneficial for smaller firms. “They did a bit of farming work, and farmers like to deal with local lawyers,” says Iain McBrayne. “Even though most of the private client lawyers moved to Birketts, this kind of event makes clients rethink their legal arrangements.”

Meanwhile, McBrayne’s own firm, Hayes and Storr, had been growing its private client department in the past year, opening a new office in King’s Lynn with the 15 lawyers that made up the private client department of local competitor Ward Gethin.

East Anglia, a quiet backwater? Maybe, but not for long.



Jean-Yves Gilg is editor of Solicitors Journal