North East still rocks

In the North East, there is Newcastle, and there is the rest. In most other parts of Britain, a firm with five partners, 12 fee earners and 30 staff would fall into the 'small firm' category, but this is Northumberland and Alderson Dodds is the largest firm in the county.

But here as elsewhere, times are hard. Nigel Dodds, the firm's senior partner, remains optimistic but says that for firms of his size, it will be a question of survival of the fittest. 'All you can do is run your business efficiently, and attract more clients than the other firm down the road,' he comments.

Dodds says his efforts to expand the firm's practice base has offered some security in the current climate. 'We've been fortunate that we have a broad base of work and are not over dependent on any one area, with a good balance of private and legal aid work,' he says.

Commercial work in particular is holding up reasonably well, and the litigation side has also picked up. 'There has been a radical change in approach to litigation,' Dodds continues. 'In construction, in particular, disputes are no longer about straightforward debt collection as parties are more willing to mediate to reach a workable solution.'

Employment is also getting busy, but Dodds confesses businesses in the area take a more brutal approach to redundancies, with few exploring the alternative solutions considered by their larger counterparts.

'Employers either tend to want to keep their employees or they don't; for smaller businesses in particular, there is not much that can be done in the way of alternatives to redundancies,' he comments.

Another firm with a large legal aid practice is Ben Hoare Bell, which has five offices across the region. Jeff Dean, the firm's senior partner, shares Dodd's general outlook.

'We still don't know what the 2010 contracts will be like,' he says, 'and the reorganisation in procurement areas could have a major impact on providers like us.'

At the moment Ben Hoare Bell could bid in two areas but the question is how they could supply services in other areas where they have the skills but may not meet all the criteria. Consortium working is an option but Dean says there is little experience of how these work in practice.

'We don't know how consortia will work or what they really stand for,' he continues. 'We have good working relationships with other legal services providers including the legal advice bureaux '“ is this relationship expected to morph into a consortium or something more formal?' he asks.

Though mostly a legal aid firm Ben Hoare Bell handles a small but not negligible amount of privately funded work. Family and personal injury work has even seen a steady increase and Dean is keen to develop this strand, but he is also wary that the segment of the market in which a firm like his will operate is likely to be the prime target for high-street retailers come the Legal Services Act.

'We can't yet predict what the impact of Tesco law will be but we can guess what large cash-rich organisations will be able to do,' he warns. 'The LSC now expects us to take on heavy personal injury work on a CFA basis, but that's precisely the type of work that Tesco will be looking to get into,' he says.

In the commercial world

Over in the world of privately funded work, the picture is also one of tough trading conditions forcing firms to reconsider their development strategies.

With 20 partners and 160 staff Sintons has retained a balance of commercial, personal injury and private client work, although, according to marketing director Charles Penn, commercial work requires the greater effort. The firm completed 70 deals last year but Penn says it is getting a lot tougher now as the size and number of transactions has come down, replaced in part with re-financing work which, a sign of times, is generating reasonable volume work.

Like most commercial firms not based on Quayside, Sintons is competing with the larger firms on price, saying it is offering better value for money. But in the current climate the firm is also having to be more active in generating new work from outside its traditional base.

In commercial property for instance, the firm is getting involved in environmental projects such as windfarms and is also on the panel for seven insurers, handling high volume personal injury claims.

But perhaps the most interesting streak is the firm's foray in the health sector. In the past few years the health team has been growing its profile in the dental sector and is now one of the few firms nationwide recommended by the Association of Specialist Providers to Dentists, a body providing assistance in the buying and selling of dental practices.

Sintons is also involved in a few of the proposed polyclinics advocated by Lord Darzi, working with primary care trusts and developers specialising in medical property.

The same cold wind of the recession is blowing on larger firms. At 60-partner firm Ward Hadaway, 30 staff were made redundant in the property department before Christmas but senior partner Jamie Martin says there are still plenty of opportunities in other sectors.

Public sector represents a large part of the firm's work, and Martin sees this as providing a stable base in the downturn. Similarly, he is confident the firm's expertise in healthcare and education will contribute to its well-being. One example is the firm's growing involvement in LIFT, the Local Improvement Finance Trust, the body providing finance and working to improve delivery of care and medical services.

Bravely, the firm has also pressed on with its plans to set up an office in Leeds, 100 miles south.

'Leeds is a very competitive market but geographically it seemed the right place for us to open a new office,' says Martin. 'We already had clients in Yorkshire and that is helping us push the boundaries of our operations.'

So far the plan has been successful and the Leeds office is still looking to recruit. Being so far apart from the mothership could inevitably create management problems, but Martin says that they have been careful to appoint lawyers from the local pool and that there are clear reporting lines to Newcastle.

Small is still beautiful

When Solicitors Journal spoke to the partners at McDaniel & Co last year the husband and wife firm, based just outside Newcastle, was buoyant '“ and they still are, even though they too have to work extra hard to keep the business moving.

The firm's family department, run by Rozanna Head-Rapson, has grown from just her and a secretary to three solicitors, one trainee and two secretaries. Meanwhile, husband Niall, an intellectual property specialist, has added one solicitor to his team (who trained and qualified with the firm) and is looking to recruit another. In addition, the firm now counts two consultants, one providing general company/commercial advice, the other, a former in-house lawyer at Siemens, employment law advice, taking the overall headcount to 15.

Rozanna's work is to a large extent self-generated. Word of mouth and client recommendations have helped establish the family team's reputation. So far, nothing unusual, but the mother of four has also trained as a collaborative lawyer and is actively promoting this soft solution not only to clients but also to other family lawyers in the region.

The results speak for themselves: the firm had three times as many clients seeking family law advice last month than they had at the same time last year.

Niall's side of the business has equally prospered, helped in part by his position as a panel member of ACID, the anti-copying in design action group, a body comprising larger corporations as well as smaller businesses such as designers and furniture makers, all of whom are in regular need of intellectual property advice.

Niall has been on the ACID panel for a few years but this year marked a turn in the benefits of being a preferred firm. 'Until now our work came from clients based outside the region, but for the first time this year we've been instructed by large local businesses who have found out about us through ACID and didn't expect to be able to find IP lawyers up here,' he says.

Around the corner, another family-run firm Solicitors Journal spoke to last year is reporting the same upturn in litigation.

Toby Gibson, head of commercial litigation at Gibson & Co, started from a different base though. After training in the City Gibson took over his ancestors' 18th century firm, and with it a high street presence in Hexham, a market town half way up the Tyne from Newcastle. Like most other high street firms, property work has all but disappeared except for agricultural property where prices are holding up. This however is only marginally helping with property work but it is usefully shoring up commercial work where agricultural land can still be used as guarantee to finance the development of farms buildings or the purchase of new machinery.

Wills and estate planning on the other hand has remained busy, and, in addition to general litigation, banking-related disputes continue to be a good source of work, including professional negligence claims against lenders and valuers, according to Gibson. And like his counterparts at McDaniel's, Gibson says that offering City advice at reasonable rates is a major advantage over commercial Quayside law firms.

Property prospects

While none of these firms have actively developed their property departments, some newcomers are already staking claims to a slice of the post-LSA market.

Cinnamon Property Lawyers, the phoenix that arose from the ashes of Dickinson Dees' volume conveyancing business, is offering a new model for bulk conveyancing where customer care is seen as key selling point.

'We're a commoditised business but we didn't feel that clients were given the level of customer care they could expect,' says John Cook, formerly at Dickinson Dees and now Cinnamon's director. 'For instance, each client is allocated his own lawyer who follows the case through.'

The company was set up as a licensed conveyancing business but it also employs solicitors, and the lawyers own 25 per cent of the shares.

As a technology-driven company, Cinnamon is keen to make the best of automated services. Emails are sent automatically to clients to inform them of each step in the transaction. 'Writing an email can take ten minutes, so on a large scale there can be significant cost savings here,' Cook says.

Is there anything for traditional firms to learn from the likes of Cinnamon?

Cook says many law firms in the regions still do not even have a website, but for every such firm there is another that embraces technology.

Nigel Dodds for instance, says it's important to 'keep your kit up to date'. In practice, this means embracing Lexcel standards (Alderson Dodds was one of the first to get Lexcel accredidation). 'It has little benefit in marketing terms but it provides useful reassurance once the clients have come through the door '“ and it keeps the firm on its toes,' he adds.

Even in legal aid, Jeff Dean says technology will help with efficiencies. 'It may not be as obvious as with privately funded work but integrating web-based services and file networks with telephone services, face-to-face advice and even possibly webcams could bring huge improvements for clients,' he says, 'particularly if you are providing services across the whole region, where it will not be always be physically possible to be present to meet clients.'

Focused strategies, lean management and flexibility are the order of the day for now, and technology will help in running a tight but efficient ship. This may not be a guarantee of survival but these law firms have got their houses in order and provided they carry on in this way, they should come out the other side of the recession in even better shape and not go the Northern Rock way.