Greater London: small is beautiful

There are still generalist practices in London and Greater London happily providing a mix of privately and publicly funded work.

David Emmerson, head of family law at Edwards Duthie Solicitors and chair of Resolution's legal aid committee, is proud of his firm's credentials in this regard. With 21 partners and 190 staff over six offices, the firm is not exactly a 'small' firm. In fact, it is the largest firm in the east London'“Essex border and it is a reassuring example of how a practice committed to legal aid and of still comparatively modest size can thrive in an adverse environment.

The firm was formed in 2001 from the merger of two smaller practices, E Edwards Son & Noice and Duthie, Hart & Duthie. It offers the usual high street range of services, including commercial, conveyancing, housing, commercial property, personal injury, crime and employment, but one third of its clients, according to Emmerson, are on legal aid and this proportion has remained quite constant.

A family lawyer dealing with both privately and publicly funded clients, Emmerson, who was awarded an OBE in 2004 for his work in publicly funded legal services, has his own views about the legal aid reforms but he takes a pragmatic approach.

'Once the Treasury had decided it was going to impose cuts in the level of legal aid spending, the reforms were inevitable,' he says, 'and the question over the past two years has been how to make the best of poor resources.'

The firm's success is based on a development strategy which involves extensive training sessions within the teams, with weekly caseload reviews targeted at producing the most effective results. 'The key is good client skills and sound management,' continues Emmerson. 'The reality is that if legal aid lawyers are being paid less, clients are going to get less, so we need to devise different ways of delivering comparable results.'

Investment in IT goes without saying and Emmerson says that firms that have not already made this investment will have to. Whether it is legal aid work or private cases, IT can reduce duplication by only inputting information once and lawyers can access a bank of precedents '“ letters and other documents '“ which can then be tailored to individual clients' requirements. But although his IT team says that they are using only 20 per cent of the IT potential, there is 'nothing magical about it', says Emmerson.

The ideal supplier

So, on paper the firm is the perfect example that the Legal Services Commission (LSC) is promoting: large enough that it can generate economies of scale and be a worthwhile legal aid supplier, but small enough that it can deliver a personal service.

But Emmerson is not so convinced that in practice size is the most relevant factor. The firm offers legal aid across 13 category areas and intends to continue doing so. This is part of its culture and it has more or less doubled the throughput, but it is constantly monitoring its involvement.

Many firms follow the pyramid model of expertise, with one specialist at the top and dozens of juniors underneath turning the wheels. Edwards Duthie has opted for a different approach.

'We have chosen to recruit lawyers who are experts in their field, they can get the answers quickly, and that allows us to be more efficient. We do delegate some of the work to paralegals but the ratio is never more than one specialist to one paralegal.'

This is not to say that the firm has not evolved in management terms. Equity partners continue to have a key role deciding the firm's direction but there is now also a practice director who helps to run the business.

Has this been prompted by the impending Legal Services Act? Possibly, but Emmerson says that it is mostly because the law is becoming a more competitive market, requiring firms to work harder and take a more business-like perspective with development plans and clear strategies. But he does not regard banks and supermarkets as a serious threat just because they might be offering certain services at lower prices.

'We all know what kind of services they will offer,' he says, 'it will be built around call centre-type structures, but things like buying property are a major event in people's lives and there is a market for personalised services with a slightly more expensive price tag but which offers higher quality of advice.'

Across town in west London, Russell Conway, senior partner at Oliver Fisher, takes a similar sanguine view, although he says he cannot be complacent.

His firm only has two partners, six fee-earners and a total of 21 staff. About half of the case load is legal aid '“ mostly housing and family matters '“ but for the Legal Services Commission, he is not a 'small' firm because the legal aid contract is worth over half a million pounds a year.

Balancing act

Located in Notting Hill, Conway's firm has a diverse client range. 'We work between Kensington North, a borough which is so poor that it gets EU aid, and the affluent South Kensington, so it is not unusual for members of the aristocracy to be sitting in our waiting room next to an asylum seeker.' And it is that combination which has been the heart of the firm's success.

'We are a dedicated legal aid firm, but it would be very difficult to run a firm entirely on revenue from legal aid,' says Conway.

'The average billing and hourly rate are low and legal aid income alone would not be enough to fund a working environment where staff feel comfortable and motivated, and where clients feel at ease. So in effect, our private work subsidises legal aid work.'

As a generalist practice with a strong legal aid slant, the firm has developed a solid reputation in landlord and tenant work, which has resulted in increasingly more work coming from landlords.

But in its 50 years of existence, the firm has also taken radical decisions, focusing on what it believes it is good at and getting out of peripheral areas.

'We used to do crime, immigration and personal injury,' Conway continues, 'but now we concentrate on housing, matrimonial and general private client work, including wills and conveyancing. We are expanding our matrimonial department to seven people next month and the plan is to grow the firm to 30 staff by 2010.

'People are a bit more savvy when it comes to managing their assets now, particularly as the rise in house prices has made home owners aware of their worth, and there is a growing demand for advice on wills.'

This relative increase in wealth may be manna for the larger private client firms but Conway says that his and other smaller specialist firms are benefiting from this trend. 'We provide the same quality of advice and we can compete on price, so either clients come to us first in preference or they have been to one of the larger firms and want a second opinion '“ if you are advised to settle for so many millions, you want to make sure that this advice is correct.'

But Conway is not just waiting for clients to knock on his door he is actively promoting his firm. His marketing budget is used more and more to invest in the firm's website, which he says brings a lot of work in.

'We promote the website with search engines with Google Adword for instance. It is a cheap way of marketing the firm, even though you need to spend a bit of time to set it up, but it is worth the effort,' says Conway.

'Clients won't instruct you simply on the face of the website but they often mention it when calling later to make further enquiries and make an appointment.'

This is not to say that the firm has given up on more traditional forms of marketing, such as entries in Yellow Pages, but the return is less than with the web where you know you can reach millions of potential clients.

The biggest problem according to Conway is succession: 'Increasingly young people don't want to be partners, they don't want the responsibility and the risk of having their house taken away when they feel they can have a rewarding career without that risk.'

Conway himself started at Oliver Fisher as a trainee, as did Jo Shortland, the other partner in the firm. Some trainees have moved on and later became judges, so there is little doubt about the quality of training that is received at the firm.

'The large firms know that trainees in firms like us have the client skills they need and trainees will be attracted to these firms; we would like to keep them on but it is difficult,' he comments.

The good news is that his firm recently received funding from the LSC for a two-year training contract, so there are now two trainees at the firm. It expected a few dozen applicants and got hundreds, which Conway feels is a positive sign.

In the current shortage of training contracts, more applicants with good degrees are naturally gravitating towards smaller firms. And Conway also takes comfort from the fact that it is increasingly acknowledged that, as a junior lawyer, getting a training contract at somewhere like Oliver Fisher is likely to set you in good stead in your career and that it will also be a good place to work.

Enjoying independence

But it can take a lot of effort to look after a trainee, particularly for a sole practitioner, which has stopped Hamish McNair, of Mc Nair & Co in Fulham, from taking on trainees at the moment despite a positive previous experience and the value it could bring to his practice. McNair occasionally shares his workload with another solicitor associated with his practice and says that, while business development and succession plans are on his mind, it is a question of finding the right person.

McNair qualified with a small London firm and specialised in intellectual property (IP) law. After a stint at McFarlanes and a few years in New York he decided he would set up his own practice.

In the course of the next 19 years, work gradually expanded and he is now a general practitioner offering advice on most aspects of private client law with a specialisation in IP matters.

'Initially clients came to me for advice on copyright or trademark, and would later ask if I could do their wills; it just grew from there,' says McNair.

Now calls come from people who were recommended by former or current clients, asking him to do their conveyancing or for advice on probate matters.

The bulk of McNair's work is still through word of mouth '“ certainly most of the good work '“ but he also has an entry in Yellow Pages and his website generates a fair amount of work too, including recently copyright work for a fabric's manufacturer. He does no specific web promotion as such but expects the legal directories in which he has an entry to ensure that they promote his practice with the search engines.

McNair also does low-key cross-selling by making sure that he explains to clients the range of services he offers, but other than that, his promotional effort is focused on nurturing the more valuable clients and weed out 'those who are just after a bit of free advice'.

The measure of McNair's success is his longevity as a sole practitioner in circumstances which all acknowledge as particularly tough. His turnover has steadily increased, though not on the scale of City firms doing the same type of IP work, and he is determined for the time being to continue to enjoy his independence as a sole practitioner.

'Having a broad practice is valuable to me,' he says. 'The variety of work makes life more interesting and having this perspective is also good for clients. There are between four and 5,000 sole practitioners who have survived various changes in the past decades. The Legal Services Bill is just one of those changes; there will always be scope for sole practitioners and lawyers in smaller practices who can provide independent advice.'