The Legal Revolution
20 December 1999
The legal profession has become almost unrecognisable since the 1960s with the sexual and global revolution and the realisation that it pays to advertise. Dominic Egan takes a look back over the last thirty years and gets a first-hand view from those who were involved in the legal century
During the last three decades, the legal world has undergone a revolution. Indeed, the last 30 years probably witnessed more change than the previous 300. However, one factor more than any other distinguishes the legal world of today from the legal world of the past. And that is size.
It is not just a question of there being more lawyers than ever before, although that in itself is significant (see box). The crucial issue is that lawyers now work in bigger law firms and bigger chambers that bear little or no resemblance those of 30 years ago.
Size has affected the law in so many ways. Law firm expansion saw the death of the traditional collegiate culture and the introduction of corporate-style management. As law firms got bigger, so solicitors began to specialise. That, in turn, forced barristers to become more focused and caused the demise of the generalist sets that had held sway at the bar for so long.
Bigger firms and chambers could no longer be run as gentlemen's clubs, with the result that women and members of ethnic minorities finally got a chance to shine. And size gave the regional and national firms the ability to compete with London.
Increasing demand for lawyers not only led to the formation of a string of new recruitment agencies, but to the birth of the legal trade press. By improving the flow of information and speeding up the process of change, The Lawyer and other publications themselves played a part in the legal revolution.
Most important of all, with size came competition, and with competition came the end of an era. A sleepy, self-satisfied legal profession that cared far too little about its clients was finally transformed into a dynamic service industry.
Back in 1969, Keith Clark was a small fish in a small pond. He was a newly-arrived articled clerk at Coward Chance, a well-regarded City firm with around 20 partners, another 40 or so solicitors, legal executives and managing clerks, and a handful of foreign offices. Clark could not have known it then, but he had entered the legal profession at a turning point in its history. Just two years before, the Partnership Act had been amended to remove the bar on partnerships of more than 20 members. As a direct consequence, the fish and his pond are somewhat bigger these days.
Clark is senior partner at Clifford Chance. More to the point, come midnight on 31 December, he will be chairman of a firm with 570 partners, 2,430 other fee-earners, 2,800 non-legal staff and 30 offices worldwide. Not content with that, Clark and his partners plan to double the size of the operation over the next four to five years.
Just about everything has changed since 1969, not least the role of the man at the top. Back then, says Clark, Coward Chance's senior partner Neville Henle had little more to do than be a focal point and chair partners' meetings. "The partners' approach to things was much more individualistically based. So there was no need for the kind of teamwork you have nowadays. There was no real need to drive agendas," says Clark.
Clark does still chair meetings - he heads the Clifford Chance board - but the similarities with Henle end there. "My role is very much about the long-term vision of the firm and policy issues affecting partners, and also working alongside and monitoring what the executive is doing." In his opinion: "Subsidiarity is key...You mustn't try to keep things in the centre."
Clark is also there to ensure that partners buy into the vision. "It's about staking out what is perceived as direction, not as a directive thing, but you've got to get partners to participate in that direction." Getting partners to understand the challenges the firm faces means that decisions can be made "without huge stress... But it needs leading".
At first sight, Clifford Chance's successes dwarf those of regional and national firms such as Wragge & Co. However, in their own way, Wragges' achievements are just as impressive. Like a number of firms outside London, it has not only completely reinvented itself in recent years, but has established itself as a presence in the national legal market.
When John Crabtree joined Wragge & Co in 1971, it comprised approximately 80 people. "There were around 10 partners," he recalls. "I was one of four articled clerks. There must have been 10 solicitors and we had quite a few managing clerks." The work they did was solid but not spectacular. "We had a big private client practice and on the back of that there were a lot of family companies, private companies that we did work for. There were two plcs and we had the Lloyds Bank connection. We didn't do any matrimonial work, but we did a lot of residential conveyancing, a lot of wills, a lot of estates, a lot of probates. On the corporate side, we did company formation, amendments to articles of association, the odd bonus issue, that sort of thing."
The City was not losing any sleep over the threat from Wragges. "I didn't do any work outside Birmingham," says Crabtree, who rose to be one of the top corporate finance lawyers in the Midlands. "I'm sure most of the listed companies in the Midlands got their primary advice from London."
And then along came Mrs Thatcher. "It probably wasn't until the real boom years, the yuppie years in the mid-1980s, that things really dramatically changed," says Crabtree. "That was the first time we started to pack on some numbers and make some big money. There was a lot of frothy work around. A lot of conglomerates were buying anything that moved. Management buy-outs were taking off, there was lots of venture capital sloshing about."
However, by 1991, when Crabtree became managing partner, the UK was in recession. With no more "frothy work" about, Wragges and many other firms struggled. But Crabtree persuaded his partners to bite the bullet and continue to expand. By offering clients greater specialisation and strength in depth than had previously been available in the regions, Wragges was able to attract work away from the City as clients became more cost conscious. "There were just bags of opportunity," says Crabtree.
Today, he is senior partner of a firm with 81 partners and 425 other fee-earners. Apart from Lloyds Bank, clients include AT&T, British Airways, Cadbury Schweppes, EMAP and PowerGen. London may not like it, but Wragge & Co and its peers are a force to be reckoned with.
"When I started, our litigation department was just one managing clerk. No partners went near it," recalls Crabtree. "Gentlemen didn't do litigation," confirms Paul Shrubsall, one of the two senior clerks at One Essex Court. "You looked after your landed clients or trade clients or whatever. You didn't get yourself involved in the mucky business of litigation." His fellow senior clerk, Robert Ralphs, recalls: "Most of the litigation we dealt with in my first set was run by managing clerks if you were lucky, if not secretaries, who were capable of doing most of the work."
Not surprisingly, some barristers treated their law firm clients with disdain. In one notorious incident, a QC's opinion amounted to no more than: "The claim will succeed. Damages will be enormous." When it was queried how the silk could possibly charge £500 for two sentences, the barrister replied: "For writing the opinion, the fee is £10. For knowing what to write, the charge is £490."
Only in the late 1970s did the bar begin to feel pressure from the other half of the profession. Bigger litigation departments and greater specialisation led to a change in the balance of power, with solicitors no longer prepared to accept whatever barristers doled out. "All of a sudden there was the explosion in the growth of law firms," says Shrubsall. "And they were getting better at what they were doing. As they got better, they were demanding more from the people they instructed. And that drove the bar."
It was now the turn of barristers to become more specialist. "The only specialism at the bar prior to this was whether you did chancery or common law. You did one or the other. Common law encompassed crime as well, so it was a very broad brush."
A change was coming, however. In 1977 Shrubsall helped set up a new chambers in Queen Elizabeth Building. "We set out to do something completely different," he explains, "which was a multi-discipline set with three specialisms - tax, trusts and company law. That was unique, because no one had set up what was called a specialist set."
Other chambers could also see the writing on the wall and were beginning to move towards greater specialisation. At One Essex Court (which Shrubsall was to join in 1990), Robert Ralphs had begun trying to persuade the tenants to redefine their practices. "When I arrived [in 1974], Sam Stammler was the only person who had any quality work," he says. "All the other members of chambers had knockabout practices."
Getting the barristers to be more focused was not easy, admits Ralphs. His tenants had done well in the boom in legal aid work in the 1970s and were making crime pay. But from his conversations with solicitors, Ralphs knew that the jack-of-all-trades had had his day. Solicitors acknowledged that some of the generalists were extremely good, but complained that in court, they were being embarrassed by specialists.
"First, we phased out the criminal bit, then the matrimonial bit," reveals Ralphs. "One by one people took very brave decisions. Some of them looked as if they were likely to starve as a result of it. But I think they all realised that unless they changed direction, there was no hope for them of really progressing at the bar. So, over that period of 1974 to about 1985, there was an enormous transition."
Today, One Essex Court is one of the big four commercial super sets. It has 60 tenants (including 22 QCs) and a clerking team of 10. By way of contrast, 1 Temple Gardens, where Ralphs started in 1955, had a clerking team of three, which served just 11 barristers. Then again, as Ralphs is quick to point out: "That was quite a big set for those days."
The bench has also been getting bigger. Today there are 99 High Court judges and 39 Lord Justices of Appeal. Back in 1970, the figures were just 65 and 13 respectively.
The increase in numbers has not resulted in a fall in quality, says Sir Michael Kerr, who was called to the bar in 1948. "It doesn't mean that people who are there now are of less quality than people who were there in the past," he says.
"In fact, I would say exactly the opposite. I can remember some weak members of the High Court Bench. There was far more cronyism in those days and hardly any consultation about appointments, whereas the verification of quality nowadays is extraordinarily high."
However, with more people doing the job, it has inevitably fallen in status in the eyes of the profession. "I don't believe that I ever knew of anybody who refused the bench at the time that I went on the bench... It was considered a great honour." Such an honour, indeed, that barristers overlooked the financial pain of a move to the bench. "When I went on the bench, I think I had just earned £45,000, which was about the top at that time, I should think.
"My judicial salary was £11,500, so it was a colossal drop. But nevertheless, you did it. You didn't think in terms of money so much."
But then, yesterday's top barristers earned an awful lot less than their current counterparts. Even allowing for inflation, £45,000 does not compare with the earnings of the so-called "million-a-year club". Furthermore, today's top silks keep a lot more of what they earn and can accumulate very large pensions.
"For some time during my professional life, I was paying 92 per cent or something in tax and over 24 years at the bar I was only able to accumulate about £17,000 in non-indexed annuities," recalls Kerr.
He points out that the demands of life on the circuit are also making the High Court Bench less attractive than it was. With judges being appointed at a younger age, many have got young children and do not want to leave their families for extended periods.
Increased media scrutiny is another negative factor, though Kerr feels that the media have never been kind to the bench. He says: "The press of the day has never had a kind word for any judge. Never once have they said, 'Well, this is really rather a sensible judgment.' If they can't actually criticise, they will say, 'There may be an appeal and who knows what tomorrow will bring?' So it is always sensationally slanted."
Back in 1970, women lawyers were barely on the map. Women solicitors were a novelty, women barristers were rarer than an English sporting victory and women QCs and law firm partners were virtually unheard of. Indeed, some firms would not appoint their first female partner for many years yet. Slaughter and May, for example, would keep women at bay until 1985.
Thankfully, much has changed. Women now sit on the High Court and Court of Appeal benches. They make up 25.4 per cent of the barristers' profession and 36.6 per cent of the solicitors' profession. Some - such as Lovell White Durrant's managing partner Lesley MacDonagh and Withers' senior partner Diana Parker - even run major law firms. However, the fact remains that women still have a long way to go before they approach anything resembling parity with men.
Just eight of the 99 judges in the High Court are women and just two of the 39 judges in the Court of Appeal. The House of Lords is yet to see its first woman judge. There are 1,043 QCs in this country at the present time, but only 79 (7.6 per cent) are female. Law firm partnerships both in London and the regions continue to be utterly dominated by men. At Lovell White Durrant, for instance, less than one fifth of the partners are women - and that at a firm which is more enlightened than most.
Lesley MacDonagh suggests that it is merely a question of time until women achieve greater equality. "There were seven women lawyers here in 1977," she points out. "Now there are 230. That proportion means that in X years time there will be more women in every management area of the firm. So it's partially time-lag."
She is confident that women have won the battle: "It's not actually a business issue, although I'm sure that in some firms in some areas there are sexist problems. I firmly believe that in the majority of, if not all, the City firms, equality is not an issue. Juggling everything because of the biological factors is the issue...The complication, which is not women's fault, is, if they want to have children, having to combine two pretty much full-time roles."
Clifford Chance's Keith Clark argues that the nature of legal work makes a solution difficult to find. "At the end of the day, it is the unremitting demands of the client that put such huge pressures on you as a person and on the other responsibilities you have as an individual. Men don't have the level of responsibilities that women have...Although you can introduce flexible working conditions, you can't set up working arrangements that don't gel with what the clients demand. I think in some of the areas that are less heavily transactional than others, the thing can work really well, but in the heavy banking/financial and the heavy M&A areas and so on, it is difficult to make that kind of arrangement work."
However difficult it may still be for women to succeed in the legal profession, at least they now have a fighting chance. Not so long ago, they did not even have that. One Essex Court's Robert Ralphs remembers one chambers that, far from being ashamed of its sexist and racist attitudes, took considerable pride in them. He says his former head of chambers Sam Stammler, who was Jewish, once received "a wonderful letter from their head of chambers about someone who subsequently came here, saying, 'We think incredibly highly of her. If we didn't have an absolutely rigid policy about not taking Jews or women, we'd probably offer her a tenancy.'"
The legal profession's rapid expansion in the late 1980s created opportunities for more than just lawyers. The year 1989 saw the birth of Quarry Dougall, a new breed of legal recruitment agency, while 1987 witnessed the arrival of The Lawyer, the first business magazine to take a critical look at the profession.
The conditions were perfect for the launch of a professional business magazine, declares founder and first editor Lindsey Greig: "You'd had the massive growth in the City, partly tied to the Big Bang. They were going crazy to recruit lawyers, so you had an enormous growth in recruitment advertising and you had the potential to fund a controlled circulation magazine."
It was not just about money, however. There was a real need for a legal business magazine, he argues: "Regional law firms and the City law firms were being transformed. So there was a self-consciousness among lawyers and an interest in what other people had been doing that hadn't been there before. Everybody wanted to know what was happening and there was nowhere you could read that, because all that was available was the Gazette, which didn't really contain anything like that."
In fact, the timing could not have been better. The first issue of The Lawyer, which appeared in February 1987, coincided with the merger of Clifford Turner and Coward Chance, handing the magazine exactly the kind of exciting story it was looking for. "What I wanted it to be was a cross between the Financial Times and the Mirror," Greig says. "The aim was to be very accurate and objective, but to be very punchy too - to go for sexy stories and to really run with them...What we aimed to be was the voice of the profession and the mirror of the profession, so that people would look at it and see themselves."
But not everyone was happy with the sometimes irreverent editorial line. "The Law Society at one stage refused to speak to us. They said we would have to fax over questions to them and they would reply by fax and they wouldn't answer the phone to us. It didn't last very long. I just said, 'Look, we're not going to fax you over questions. We will ring you up. If you don't want to talk to us, we will simply say that the Law Society refused to comment.'"
But the people that really mattered liked it, says Greig. "It was phenomenally successful. It went from a standing start of nothing to within 18 months or two years turning over something like £1.5m."
It was an exciting time, recalls Greig: "There were some very interesting people around in the legal profession at the time, because things were changing. People were thinking about what they should be doing. So it was that sense of everything being made new. There weren't any given answers."
There are still more questions than answers. And there always will be. Now that the revolution has begun, it is never going to stop. Once so resistant to change, the legal profession is gradually accepting the fact that it has entered a new era of perpetual motion. As soon as one challenge is met, another arises (see box, The Millennium Challenge).
The profession has come a long way in the last 30 years. Above all, it is no longer blighted by complacency and, as a result, offers a vastly superior service to its clients than it did 30 years ago. Indeed, the relationship between lawyers and clients has completely changed. "In the 1960s and 1970s, lawyers were reasonably reactive to instructions," states Clifford Chance's Keith Clark. "Now, lawyers can be trusted business advisers, helping their clients and then using the law as a facilitator to implement strategic decisions. The whole thing is a lot more proactive. Lawyers can operate effectively as partners with their clients."