FD Legal archive

Volume 3 Issue 3

Welcome to the February/March issue of FD Legal and I hope you are having a prosperous year so far. Did I sound hopeful there? I do hope so. I meant to. You see it’s my New Year’s resolution to rise above the ‘doom and gloom’ and focus on the positives.

So I’m sure you’re wondering how I have fared during January – the ‘new attitude’ answer is: ‘It could be worse!’ The honest answer is that, as 2009 stretches before us and we have at least another year of this (minimum) before the start of the upturn, well, it’s very difficult to maintain a positive outlook. I am trying, I promise.

Therefore, so as not to break my New Year’s resolution, I have picked the one great positive of 2009 so far, that no amount of negative can cancel out – the inauguration of Barack Obama as President of the United States of America. And so, rather than paraphrase, I defer to his words on that historic day, and hope that they inspire you as much as they have me.

So, my fellow lawyers and non-lawyers:

“… that we are in the midst of crisis is now well understood … Our economy is badly weakened, a consequence of greed and irresponsibility on the part of some, but also our collective failure to make hard choices and prepare ... for a new age … Homes have been lost; jobs shed; businesses shuttered … Today I say to you that the challenges we face are real. They are serious and they are many … They will not be met easily or in a short span of time. But know this … they will be met … The time has come to reaffirm our enduring spirit; to choose our better history … It has not been the path for the faint-hearted – for those who prefer leisure over work, or seek only the pleasures of riches and fame. Rather, it has been the risk-takers, the doers, the makers of things … Our minds are no less inventive, our goods and services no less needed than they were last week or last month or last year … All this we can do. And all this we will do …With hope and virtue, let us brave once more the icy currents, and endure what storms may come...”1.

I would like to thank all those who have helped me with this issue of FD Legal. If there are any issues you would like to see covered or if you wish to contribute please do get in touch. Any feedback would also be very gratefully received.

Joanna Lee

Editor

1. Taken from the transcript of Barack Obama’s inauguration speech:

http://www.nytimes.com/2009/01/20/us/politics/20text-obama.html

New York Times, 20 January 2009

Features

So you have risk management – what do PI insurers make of it? This article is for subscribers only
The current world economic turmoil is causing wide-ranging problems for businesses. Here in the UK we are firmly in recession and comparisons are being drawn to the early 1990s. Well-known high street retailers are in liquidation, the property market has fallen dramatically in value and repossessions are increasing. Business confidence is critically low and increasing levels of unemployment are putting additional pressures on government.
By Colin Taylor

Limiting liability for solicitors – part two This article is for subscribers only
The first part of this article considered the basic structure of limiting liability. As limitation is now commonplace, it should not be difficult to persuade a judge that limiting liability is fair and reasonable. The language of the clause is more likely to be a risky area. Try to resist being a lawyer and drafting against every conceivable eventuality and remember that a simple clause is likely to be more effective1.
By Peter Ashford

Opportunities from financial turmoil This article is for subscribers only
As an accountant specialising in advising law firms across the country, readers will not be shocked if I say that the last quarter of 2008 was a depressing time to work in, or to advise, law firms. In my market sector, I advise firms with 50 partners or less. Looking at the sector as a whole, this size covers around 75 per cent of firms; therefore my client experience is a good straw pole of the issues that exist within the legal market.
By Andrew Allen

Is the current recession the best thing that could have happened to the legal industry? This article is for subscribers only
Was anybody really expecting a recession of this severity?
Shocking headlines about the worsening state of the global economy have been inescapable for nearly a year now, and journalists still seem able to find increasingly depressing news stories on a daily basis, regularly assisted by government and the banking and finance sector.
By Patrick Harwood

Mergers in the legal profession This article is for subscribers only
Merger is simply one option in a firm’s strategy. Sometimes, however, it is the only solution – a merger may be the only realistic way to achieve a firm’s ambitious strategic goal. Yet there is a choice: change the strategic goal to a less ambitious one and remove the need to merge. There is no situation where merger is the only action from a strategic viewpoint.
By Alan Hodgart

Cover story: 2009 – a recession, a depression and an ailing profession? Free
As 2008 turned into 2009, certainly this year, rather than new beginnings, brings with it the end of many careers, the demise of some firm practice groups and a whole lot of management resolutions.
As we face the introduction of legal disciplinary partnerships (LDPs), I’m sure back at the inception of the Legal Services Act (LSA), no one imagined we would be in the position we are now in – although there’s no time like the present for change and a little extra cash(flow).
By Joanna Lee

Regulars

Budgeting in a down economy This article is for subscribers only
Law firms, irrespective of geography or time zone, have gained a new appreciation for budgeting and the importance of business planning during these tough economic times. How to develop accurate business plans – quickly and efficiently – in a streamlined and collaborative manner is at the top of law firm agendas across the lands.
By David Thorpe

Risk focus: Managing higher-risk practice in a credit crunch This article is for subscribers only
Two recent headlines, involving severe penalties on financial institutions, serve as a timely reminder to monitor client risk, particularly in higher-risk jurisdictions and higher-risk practice areas.
By Frank Maher

Thought leader This article is for subscribers only
Many of the practices that in the past seemed to be the very definition of what made a professional firm a different kind of organisation have all but evaporated. It may be time to ask: what is a professional service firm? What do firms gain and lose in becoming like ‘conventional’ businesses?
By David Maister