Search for the comfort factor
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8 June 2007
In Newcastle, according to one observer, the legal hierarchy is set in stone. Everyone knows their place. Dickinson Dees is at the top, and everyone else follows.
This may be a simplistic and superficial view; it means the initial perception is that all the other practices in Newcastle are tilting at Dickinsons.
In reality, the other commercial firms like Eversheds (formerly Eversheds Hepworth Chadwick), Watson Burton, Robert Muckle, Wilkinson Maughan and Ward Hadaway would probably disagree.
Watsons, in particular, would reject this view. Having previously been described as "an amalgam of fairly small branch offices doing mainly high street work", the firm bit the bullet in 1995 and hived off its four satellite offices. This was a deliberate move by the practice to retain its central office in Newcastle and concentrate its resources on the more lucrative commercial work.
Watsons' commercial property partner John Knighting explains: "Our previous setup was giving the wrong message to our clients, who assumed that we were five little high street offices, which was far from being the case." The firm is now going through a period of stabilisation and consolidation, but whether the move will make Watsons a serious rival to Dickinsons remains to be seen.
With the increasing number of beauty parades, a number of the smaller commercial practices may think they are being given more of a chance to get a foothold in the sector and take a chunk of Dickinsons' business.
Dickinsons recently lost out when Northern Electric, which is normally advised by the firm, instructed Slaughter and May in the bid for it by Trafalgar House. However, this does not necessarily mean there is a chink in Dickinsons' armour.
If work is being taken away from the local market, national and regional lawyers can be put at a disadvantage because they may have to work harder to be considered to be on a par.
Dickinsons' managing partner Graham Wright says City firms are often seen as giving a corporate client "a heightened comfort factor". He adds that with the increasing level of competition from outside the region, the firm has had to work hard to remove such a perception. "Firms have to strive to provide clients with the client-focused service and capability they are looking for as well being seen to have that comfort factor," he says
That factor already exists at a national firm such as Eversheds, and Dickinsons (which is a member of the Legal Resources Group along with Pinsent Curtis, Osborne Clarke, Alsop Wilkinson and McGrigor Donald), like other firms in the region, is watching the national Eversheds model with interest.
Eversheds' Newcastle office, dubbed the 'Cinderella' of the group, is growing, including expanding its shipping department. The national firm also has a presence in Leeds and Middlesborough, where the main competition consists of Punch Robson and Jacksons.
Newcastle as a whole is regarded as far more stable than Leeds, with less of a rumour mill. Firms have had time to adapt to the marketplace.
Robert Muckle commercial partner Hugh Welch says there has been more general commercial work than insolvency and it has been developing that area of the practice over the past three or four years. Another recent development has been a separate construction unit within the firm.
Many local lawyers admit the Newcastle legal market is "quite difficult as well as quite small". And although firms from Leeds have been known to approach Newcastle clients for work, a Newcastle firm looking to Leeds to compete for business is not really seen as an option - such a move would be exceptional.
On the litigation side, Crutes recently succeeded in being the only firm in the North East to be retained by insurance company Commercial Union on its panel of local firms advising on contentious claims. It was one of 26 firms invited by the insurance company to tender for the work.
Despite the sometimes downbeat portrayal of the area in the media, and the loss of much of the traditional work such as shipping with the closure of the Swan Hunter shipyards, the local lawyers have weathered the storm.
Although there is a concern locally that certain banks have been retrenching to Leeds, law firms are encouraged by the promised investment in the area by Siemens and Samsung and projects such as the Newcastle Arena.
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