Monday, 05 May 2008 06:24

Editor's Desk - Never fear, work is here

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A survey came out the day I sat down to write this editorial that showed 45 per cent of law firms in Canada and the U.S. plan to hire more lawyers in the next year. That’s good news for lawyers, particularly associates, in my view. In Canadian Lawyer’s managing partner interview each month, I query law firm leaders on some of their challenges and economic forecasts for their firms. Almost universally over the past few months, they’ve told me that associate retention is one of their greatest challenges but also that they need new lawyers, particularly in business law firms.

This month, the outgoing chairman of Blakes, Jim Christie, tells me: “We continue to have a need to attract and recruit lots of students, young lawyers.” Last month, from Alberta, Jerri Cairns of Parlee McLaws said: “I see that strong economy as continuing to drive demand for sophisticated, effective, and practical legal advice to clients to assist them in their ongoing successes and business endeavours.” And in February, Borden Ladner Gervais’ Sean Weir also noted the need for a strong pool of young lawyers, which BLG goes to great lengths to attract and retain. “We invest a lot in education and programs and do a lot of intensive training from new associates to junior partners,” he said.

As I said, all good news for lawyers. A few other tidbits about the legal business scene have been gleaned from these interviews. The best news is Canadian law firms don’t foresee laying off any lawyers even though the general economic outlook isn’t particularly rosy. What will see a shift are the areas of practice expected to grow over the next year. “I think we are starting see a change in the nature of the work our clients are asking us to assist on: obviously less big-ticket M&A, although there continues to be a reasonably good stream of mid-size M&A work; more restructuring and insolvency-related work; and I think we’ll see an increase in litigation as we go forward,” says Christie in this month’s interview. He’s already seeing the growth there. That’s backed up by the above-mentioned survey, conducted by Robert Half Legal, that reports bankruptcy, litigation, and ethics and corporate governance are the hot specialty growth areas.

Both Christie and Weir, though, noted that Canada’s business environment is pretty crowded, and any major growth in legal work is unlikely to come at home. “International growth is huge for us. Now 25 per cent of the firm’s revenue is from offshore sources,” said Weir. BLG doesn’t have overseas offices; however, Blakes does and counts on them for its growth as well. Not only does Blakes have a China office with both Canadian and Chinese lawyers but, at home, has a strong practice group that supports its growing Chinese client pool.

And while no Canadian firms are going this route yet, the newest booming market appears to be the Middle East. For example, in early April, it was reported that U.K. magic circle firm Allen & Overy had launched a major recruitment drive in order to add up to 20 associates and partners to its United Arab Emirates’ office. Dubai is also a hotspot. Many European law firms are also starting to look at the emerging markets of Eastern Europe, such as Romania and the Ukraine, as their next lands to conquer. Already a number of U.K. firms have expanded into the region. And, mark my words, once India opens its borders to foreign law firms, there’ll be an explosion of growth in that legal market.

Lots to think about and many opportunities are out there for lawyers at all stages of their careers. The unstable global economy doesn’t seem to be hurting the legal profession very much, which is good news if you’re a lawyer!

BACK PAGE: Wake-up call for government accountabilityBritain’s new Corporate Manslaughter Act has a terrifying name. The law creates a tort by which an organization can be held liable for a death “if the way in which its activities are managed or organized” is a “gross breach of a relevant duty of care owed by the organization to the deceased.”

If a weekend fire sale, backed by loans from the government, of one venerable U.S. financial institution to another — an institution that was worth $170 a share one year ago but went for $2 a share — is not a sign of economic volatility, then what is? The sale of Bear Stearns to JPMorgan Chase was done over a weekend and completed swiftly before the markets opened the following Monday morning. Over the course of that same mid-March weekend, the U.S. Federal Reserve launched efforts on the Sunday to staunch a worldwide stock sell-off, putting in place a series of emergency measures, including a cut to the interest rate at which it lends to banks, in the hopes of shoring up confidence in the credit markets. But there was no way to cushion the blow as global markets took a tumble and the U.S. suffered another hit. The episode confirmed investors’ worst fears about the fragile state of the financial economy.

And it’s within that environment, in this month’s cover story, “Dare we say the ‘R’ word,” Canadian Lawyer looks at what the next year holds for the legal businesses in this country. It would seem that predictions for the business of law are not as dire as they are for many other areas of business in this country, including the financial and manufacturing sectors. We look at various sectors and how Canadian lawyers predict the future will play out.

In M&A, the main prediction appears to be that while business may slow down somewhat the most noticeable change will be a shift in the players away from financial buyers to strategic and foreign buyers. Prices will come down allowing those other players to get more involved in transactions. Law firms may face slower periods but our experts don’t foresee any precipitous drop in work. In banking and financing, the size of deals may not be as dramatic as in the past few years but there will be much work on the ground. In the Bear Stearns sale, reports say JPMorgan has already set aside $6 billion to cover potential litigation. Commercial real estate and construction in Canada is also seeing a shift similar to that occurring in M&As: the players are changing but lawyers will still have much to do. Perhaps the only area that may see a big rise this year is bankruptcy and insolvencies. In part due to to the Canadian dollar’s strength, and the resulting lowering of competitiveness of some homegrown industries, mixed with general global financial uneasiness, it will be a tough year for many businesses that can’t adjust. On the bright side, however, our experts say most mid-size Canadian businesses have already adjusted and should remain relatively stable.

On top of the general market and business uncertainty, we also see in our report on energy and the environment, “To carbon tax or not to carbon tax,” how environmental issues are going to affect business. B.C. has just introduced a carbon tax, Quebec already has one, but there is no national strategy on whether to impose a Canada-wide carbon tax (not if the Harper Conservatives have their way), a cap-and-trade system, or a combination of the two. What Canadian business doesn’t have right now is any idea which road these regulations will go down — or even when that might happen — which makes long-term planning a bit more of a crapshoot than long-term planning is by nature.

It will be an interesting year for business and the markets, both in Canada and the world, but the good news is that lawyers don’t see doom and gloom for their businesses in these uncertain times.

Monday, 07 April 2008 05:16

‘I can do better than that’

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The other week I bumped into my old friend Marty Katz. Marty was once my articling student. Talented lawyer though he was, it was evident that the practice was not for him. He went on instead to an interesting career in the artistic and media world, and now is a successful film producer.
Friday, 07 March 2008 07:18

Editor's Desk - Technology rules!

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This issue of Canadian Lawyer is all about technology and the many ways it impacts the practice and business of law. It goes beyond having BlackBerrys and remote access to your desktops; technology has revolutionized the practice of law like it has every other part of life. I have just returned from LegalTech in New York City, a massive trade show of, you guessed it, legal technology. There was everything but the kitchen sink — but, rest assured, if there’s a way to have the sink make your law firm more profitable, it’ll be there next year.

Much of what was on display in the three floors of techno wonderland related to e-discovery and document-management software and processes. There was also a fair amount of knowledge-management software as well as general business software that keeps track of clients and accounting. The vendors tout their products as cost-reducing, maximizing staff productivity, revolutionary, exceptional value, time-saving, and on and on. They all seem wonderful . . . and expensive.

You would automatically think that knowledge management, business analytics, and such would be the domain of large firms with deep pockets and technology departments. Whereas accounting software and some client-management systems would fit with any size firm. The reality is that many of the technology companies I spoke with at LegalTech, even the ones offering high-end business analytics and comprehensive document-management systems, are able to offer smaller firms their services at prices that are affordable.

Big firms are working with these tech companies all the time and probably have any number of their systems in place to do any number of jobs. Small firms and sole practitioners, however, tend not to have much more than perhaps PC Law, and maybe some accounting programs. But even the smallest firms can benefit from these offerings. It’s hard to believe that many real estate practitioners in Canada still rely on fax machines to communicate with banks regarding mortgage transactions. Our story “Bye-bye fax machine,” on page 19, shows how one computer program (and a company with the savvy to know the niches to fill) can completely change the way an office works.

The stories are anecdotal, of course, but I’ve heard horror stories about small firms that require lawyers to make lists of all sorts of things, often handwritten, to hand to the partner/owner at monthly or weekly lawyer meetings. Other firms don’t use any sort of client-management software and everything is still done entirely in paper files. What happens when a legal assistant takes it home by mistake and forgets to bring it back? These firms have no way to really judge, other than their basic accounting practices, how lawyers are performing. There’s no way to know what other lawyers on the firm are working on. Imagine, even in a small firm, because even they have hundreds, even thousands, of client files, trying to do any kind of conflict check.

So the moral of this tale: technology is good; no matter what size your firm, there are lots of options for making it more efficient with better communication between staff. At the end of the day, it leaves more time to serve clients and will also make you better in the way you serve clients. Look into what’s out there and take the plunge.

Legal ethics: Advertising in an electronic ageAdvertising by lawyers has long been a tricky issue in Canada. Once, it couldn’t be done at all — stopped by law society rules. Over the past few years, restrictions have been eased, bit by bit, province by province. Recently, the Competition Bureau of Canada suggested the situation still isn’t good enough and that almost any rules limiting advertising by professionals go beyond legitimate consumer protection. (More on the Competition Bureau later.)
Friday, 22 February 2008 04:49

Editor's Desk - No Lawyer Left Behind

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This month’s cover story is a cautionary tale but also a chance to openly discuss issues facing many lawyers across Canada, the majority of whom work alone or in small firms. Anyone practising law knows it’s no walk in the park. Law is a stressful profession bookended by the need to stay solvent on one end and the demands of clients on the other. For lawyers in larger firms, it is somewhat easier to manage than it is for those who practise alone or in smaller firms. Large firms have not only more lawyers to turn to if you’ve got questions or problems but many have built-in support mechanisms, educational opportunities, and even accounting and human resource departments to do a lot of the basics. That’s not the case for many other lawyers and they do run into problems trying to juggle all their various responsibilities.

But it’s more than just the difficulties of the day-to-day running of a law practice — it’s the overwhelming stress of practice in general. I don’t know a single lawyer who doesn’t know at least one other lawyer who has problems with drugs or alcohol or even both. Long hours, high expectations, hefty workloads, and complex work create a perfect storm for substance abuse. What may start out as the occasional drink after work can quickly turn into a daily need for alcohol or something stronger to take the edge off. In this, the size of the law firm does not matter. Stress is stress and the search for a crutch knows no limits.

In the good old days, which weren’t really all that long ago, colleagues often knew about another lawyer’s drug or alcohol problem but not much was said about it, a few friends may have tried to help but the problem was kept hush hush. But as discipline records at the law societies will show, in the end, it’s often personal problems that start to hurt the law practice and frequently end in letters from the law society or even disbarment. It’s more likely to be a marriage breakdown or similar personal problem than any real nefarious behaviour that is at the root of what sends many a lawyer in the vortex of disciplinary proceedings.

In recent years, there has been a much greater realization of these problems within the legal profession in Canada. We saw the creation of many lawyer assistance groups across the country. Most started simply as  drug- and alcohol-support organizations but they’ve grown into much more. For lawyers who are having trouble in certain areas of their practice, they can access peer support networks to help with, say, accounting problems or complicated cases. For those having emotional or substance-abuse problems, there is access to professional counsellors in every province across the country. The Canadian Bar Association even has a section that provides education, support, and expertise to strengthen these provincial lawyer assistance programs.

Help is out there. It’s up to lawyers to recognize when they’re having problems and reach out. But there’s just as much of an onus on friends and colleagues to reach out and offer a helping hand or a bit of guidance to keep their lawyer pals off the radar of the law societies’ discipline departments.

To co-opt a catchphrase from the Bush administration: no lawyer should be left behind.

Why shouldn’t a Supreme Court appointment require parliamentary confirmation?
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