Opinion: Rex Makin

By Ben Schofield on Oct 14, 08 05:44 PM

Rex Makin.jpg

REX MAKIN predicts the closure of many law firms. Here he recounts the toll being taken on the legal profession

THESE are hard times for the legal profession, or as some people prefer, the legal trade. With the lack of house sales solicitors who once had the monopoly of conveyancing now find business of that nature has almost evaporated.

There are other difficulties and some small firms are being forced to close because they cannot afford to pay the increased indemnity premiums, while hundreds more are destined to end up in the very costly assigned professional insurance risk pool.

Some firms have chosen to shut down, claiming their inability to find cover in the conventional market.

Analysts suggest up to 500 firms nationally will fall into the pool, while the average premium for small firms has soared by up to 40%.

A firm with one of the biggest legal practices in London has re-ignited the row over fixed fees by revealing their income had reduced by approximately £150,000 a year.

At the Labour Party conference Jack Straw, Justice Minister, indicated his wish to rein in the legal aid budget further. It has already shrunk with detrimental effects on the public. The Legal Services Commission, which is dominated by the government, is accused of having no interest in quality, providing no incentive for excellent service.

It is encouraging firms with poor trade records to expand rapidly and offer poor service.

Amongst other things, this government's record is disastrous and is affecting the public at large. It is reported that the effect on practitioners is also having an adverse effect.

Long hours and stress, it is claimed, drive some lawyers to drink and drugs, both inside and outside the work place. Alcohol abuse is "endemic". A survey has revealed that 30% of male lawyers and 20% of female lawyers drink to excess.

In Liverpool you can anticipate the closure of small firms, leaving the big boys, the conglomerates with offices in various other localities, predominating.

One Merseyside firm with three branches is closing its Liverpool office and another small firm has been taken over by Southport lawyers. Another has closed one office.

Out in the big London world, redundancies are the order of the day and some who are being made redundant are not being paid for untaken holidays up to the date on which their employment is terminated and not necessarily for the notice period.

In a previous article I wrote about the extraction of punitive court fees so that justice is being denied in many cases and in particular in wardship cases where the fees have astronomically risen, so that local authorities seem to have stopped making applications.

This is as a result of our caring welfare state and caring Mr Brown by providing nursery places for two-year-old children - a cockeyed idea when his government is extracting £4,825 as a court fee for issuing wardship proceedings.

Claims firms are rampant and "selling" claims they have touted to certain solicitors who pay them a referral fee for each introduction. The price for each case seems to have gone up and is currently settled at about £700. This would appear to make pursuing a claim uneconomic, but as I have said, times are hard and beggars can't be choosers, or perhaps they should be in their own interests.

Certainly I forecast the collapse of many small firms and even "factory farmers" who derive their business through the post will also be affected.

Government policies are creating a "cottage industry" on legal aid provision. Large firms are being driven out and a major firm has shed its bulk of legal aid criminal proceedings, added to which a large firm has signed a deal to test whether road accident claims can be handled properly in South Africa (not on this occasion in Mombasa).