Positive thoughts

26 August 2009 | By Katy Dowell

Revenue per partner (RPP) has risen sharply from £1.36m in 2007-08 to £2.35m, a hike of 73 per cent. That said, a large portion of that rise could be put down to the fact that the number of partners in the practice fell from 77 to 52.

Regardless, Lovells global head of litigation Patrick Sherrington says the practice group’s headline figures fail to accurately represent the true nature of Lovells’ litigation practice.

“It’s about 23 per cent of the overall firm as defined by Lovells, but in reality this is about 33 per cent,” he says. “That would include the litigation people who sit in tax, real estate, intellectual property and employment.”

If the litigation practice did account for 33 per cent of overall turnover, Lovells would overtake Herbert Smith in the litigation leader-board with fee income of £175.2m, compared with Herbert Smith’s £162.7m.

It would also mean that the practice had 118 partners, a rise of 41 on last year.

This is a good start, considering Sherrington believes the market is yet to reach full capacity.

“Money is short and litigation is a discretionary spend,” Sherrington says, pointing to the lack of major big-ticket litigation.

“Clients don’t want to do it and things are bottled up in the pipeline. Push will come to shove and some will decide to sue, but the losses have not yet crystalised.”

Yet Sherrington is optimistic: “It’ll undoubtedly come, and when it does there will be more reluctance to settle cases.

“It should be grounds for optimism.”

Looking at the litigation sector as a whole, Sherrington feels that by mandating Lord Justice Jackson to review how litigation costs are spiralling, the Government has misrepresented the British commercial justice system as being an expensive place to litigate.

“Why should we say it’s expensive?” he asks. “It’s shooting ourselves in the foot.

“The English courts are a good place to hear cases,” Sherrington asserts, adding that the “ominous nature” of e-disclosure in the US courts is more likely to help costs spiral. By contrast, Sherrington believes that judicial control of cases in the English and Welsh courts is becoming “more effective”, which has helped keep costs down.

While Sherrington is a proud London litigator, he is also head of a practice that is heavily reliant on its international network.

Lovells was among the first UK firms to open in the US, with offices in New York and Chicago both having a strong contentious contingent.

The firm lacked first-mover advantage in Asia, says Sherrington, but worked hard to build a presence and now has a network of seven offices that includes Hong Kong. The European network, meanwhile, continues to grow with the firm perceived as having the best litigation practice in Germany, Sherrington believes.

The firm operates a matrix management system with partners meeting on a monthly basis thanks to the power of modern technology.

Despite the number of partners in the global litigation practice falling over the last 12 months, Lovells is looking to bulk up the group in anticipation of the big-ticket work that Sherrington strongly believes is coming.

In the meantime, the practice is reaping the rewards of considerable investment and is likely to come to the forefront of Lovells’ growth strategy as the litigation wave begin to pick up momentum.