Cab Rank – whose rule is it anyway ?

The recent LSB-commissioned report on the Bar’s “Cab Rank Rule” seems to have sparked plenty of debate, including a seemingly hysterical reaction from the Chair of the Criminal Bar Association and, mercifully, some measured and informed responses from respected commentators Lucy Reed of St John’s Chambers and Professor Richard Moorhead of UCL.  The report effectively concludes that the cab rank rule is no longer effective or relevant in the modern legal marketplace.

Having worked in chambers for many years, I am not entirely surprised that members of the Bar take seriously any criticism of a principle that goes to the very heart of their core professional values: the need to ensure fair representation and access to justice for all, to support the principle of the rule of law and to protect and promote the public interest.

But let’s look at the context. The report was commissioned by the Legal Services Board, in line with their regulatory objectives.  These objectives can be found here but you needn’t bother clicking on the link, as they can also be found in my previous paragraph.  In other words, the LSB and the Bar seem to be completely aligned in their objectives.

You could ask about the reason behind the report and its timing. The LSB provides us the answers on their website under the helpful heading “Why this ? Why Now ?”  One of the stated reasons is to explore whether :

“… the cab rank rule could potentially both undermine its own aim to improve access to justice (by reducing opportunities for specialisation and so the provision of niche services) and also damage other regulatory objectives, such as to promote competition.”

While this is a clear indication that protection of the Bar’s competitive position is a consideration for the LSB, this reason seems to me to be fundamentally flawed. The cab rank rule explicitly only applies to a barrister accepting work “in any field in which he professes to practise” (para 602 of the Code of Conduct).  Barristers are clearly free to profess to practice in the area(s) of specialisation of their choice, so this particular concern is in my view misconceived.

The LSB’s reasoning gathers significantly more strength in its assessment of the effect of the exclusions to the cab rank rule (set out in paragraphs 603-607 of the Code of Conduct) as:

“perhaps recognising that its absolute status is less relevant in 2013″

and tellingly:

“The fact that so much legal aid work, where access to justice may be thought paramount, is exempt …”

You can now add to this exemption any work where instructing solicitors do not agree to the standard contractual terms recently prescribed by the Bar Council.  If the Law Society’s reaction is any guide, then this means the cab rank rule will be applicable to an ever decreasing amount of cases, for reasons of the Bar Council’s own making.

Moving on from theory to practice, in basic terms the cab rank rule exists to prevent a scenario such as one where a barrister refuses to accept a case on the grounds that he disagrees with the principles or beliefs of the potential client, whether personally or in the context of their case, thus denying them fair representation.  I can only speculate as to how many barristers, when faced with the prospect of a hopeless case, for a client they don’t like, for a solicitor offering no prospect of repeat business, for a small fee, in a distant court, when they are behind on their paperwork and have other, more attractive offers on the (clerk’s) table decide they are compelled to accept the brief purely because of the cab rank rule. I would suggest that this scenario is as common as, say, a taxi turning down a fare.  In any event, no harm would be done as another taxi, or barrister, would be waiting in line.

Looking from a different angle, let’s consider the rigour with which the cab rank rule is observed. The report rightly highlights the lack of any relevant data on this.  I don’t believe any is needed, as I am convinced that it has never, ever been breached.  This may sound surprising, but less so if you look in detail at the rule itself, particulary the broad and hugely subjective exceptions outlined in paragraphs 603-606 of the Code of Conduct.  It’s hard to avoid comparison with the well-know quote from the Life of Brian : “what have the Romans ever done for us ?”

The discretion afforded to any barrister in deciding whether to accept an instruction is so wide as to render the practical application of rule meaningless.  How can you possibly define a breach, much less prove one ? Issues such as availability, expertise and reasonable fees are very much in the eye of the beholder.

I agree entirely with the report’s summary :

“While it can be lauded as a professional principle enshrining virtuous values, as a rule it is redundant.”

It now lies with the LSB to consider the report in the context of its statutory objectives and taking on board the views of stakeholders.  Its ambit quite rightly encompasses the entire legal services market, not just the Bar.   It has invited responses from representative bodies, which I hope they will receive from the Law Society and CILEx as well as the Bar Council and specialist bar associations.

Whatever the outcome, no single branch of the profession has any claim to a monopoly on righteousness.

Taxi for the billable hour …

Much has been written recently (and not so recently) about the shortcomings of the law firm partnership model and in particular the hourly billing approach. I don’t intend to repeat too much of it here and indeed it would be a struggle to add anything of value to Law firm partnership – the Grand Delusion, a most informed and authoritative piece on the subject from Stephen Mayson.

It seems to be broadly accepted in the modern legal marketplace that the hourly billing model is under pressure from clients, commentators and new (and some old) legal practices. The general conclusion is that it drives the wrong behaviours within a firm by defining success in terms of hours billed in preference to value provided to clients. As Lord Neuberger MR (as he then was) summarised in his speech to the Association of Costs Lawyers’ Annual Conference 2012, it confuses cost with value.

But the real damage is done not necessarily by hourly billing in itself, but by the way in which it is too often applied: a misguided aim at the infamous “billing targets”, driven by the need to compensate for the inefficiency of the underlying financial model of the business. With this comes a failure to (or even attempt to) recognise the difference between the hour as a basic raw material and the billable hour as time spent productively in producing an output of value to the client.

For many years I have seen barristers’ fees charged on a time-spent basis. However, the difference in the chambers environment is that no-one is incentivised to spend or charge any more time on a case than is necessary. Quite the contrary, in fact. First, as sole practitioners, barristers tend to have a busy and varied workload and they simply need to get each job done as quickly as possible in order to be able to deal with the next, or risk missing an opportunity. (Of course, doing so without compromising quality is paramount and this balancing act is one of the key challenges facing the busy practitioner).

Secondly, billing is managed by clerks, who are in a unique position of knowledge and understanding about the levels of fees charged throughout the Bar as well as how much a particular piece of work ought to be worth, bearing in mind all the relevant factors. A clerk’s job is to ensure that however much time is spent, a barrister charges a fee which is both fair and proportionate. This kind of scrutiny ensures that even though time-based billing may underpin charging methods, the overriding incentive lies in offering value and thereby staying competitive.

I am not aware of any chambers or indeed any barristers who have hourly billing targets. I suspect this would be counterproductive, as those adopting this approach would stand out from the crowd as expensive and be rejected by the market, resulting in the rapid drying up of instructions. In fact, in most cases these days barristers have to work to fixed or capped fees based on what is acceptable to the market. It is important to add here that in the vast majority of cases “the market” to which I refer is of course made up of solicitors. The irony hardly needs mentioning.

The end result of the chambers approach is the evolution of an effective value-based billing process, even though the means of achieving it may not appear on the face of it to be terribly scientific. Most importantly, it results in proportionality and fairness to the client. It answers Lord Neuberger’s concern by keeping input cost out of the equation. It results in true value.

Of course, the market seems in any event to be moving overwhelmingly in favour of a fixed fee approach.  Indeed, a recent Legal Week Client Satisfaction Report showed that almost 70% of a large sample of corporate clients favoured fixed fees.  In this context it is no exaggeration to say that for a legal practice to be able to survive in (at best) the medium term it will need to be able to adapt rapidly to a fixed fee model.

As I have illustrated above, the Bar is very close to achieving this in its current approach, if not quite already there.  Not bad for a “traditional” profession.  I suspect more fundamental change will be needed by many law firm partnerships.  Any who think they can solve the problem simply by reverse engineering hourly rates will be exposed not only by the Bar, but also by more efficiently structured new market entrants.

The challenge couldn’t be clearer.

Psilkology

Like many who work in the legal business, I very much welcomed last week’s return of the BBC TV series Silk.

Unfortunately for me I wasn’t able to watch it “live” last Tuesday, as I was travelling, but I was able to observe the commentary on Twitter.  As I did so, I found myself somewhat disappointed to read of some of the apparently glaring failings of this new production.  All manner of procedural details and even one or two fundamentals were apparently amiss.  I could hardly bear to watch as, one by one, the legal tweets chipped away at the high esteem in which I held Silk.

I could barely bring myself, a few days later, to actually watch the episode on I-Player.  But I am glad I did.  Yes, of course there were plenty of factual inaccuracies and inconsistencies.  Plenty of drama and enjoyment too, as you would expect.  But what really did grab me was one particular scene which may have appeared innocuous but in fact was an excellent depiction of one of the key roles of the barristers’ clerk and one which I suspect may have been lost on anyone who has not held this position.  Certainly it didn’t seem to be picked up by anyone tweeting on the #silk hashtag.

It was a short scene but, credit where it is due, to my mind it merits attention as a brilliant illustration of the role of psychologist that comes as part of the unofficial job description for any clerk.  Displaying an instinctive sensitivity to Reader’s post-silk rejection disappointment, Billy announces ”your caseload just doubled” while handing him several briefs returned from Martha Costello QC.  But before Reader had time to stop, think and feel slightly patronised by what was effectively a display of pity, Billy passed over another brief, this time not a return but a direct instruction, to the words ”and here’s one of your own, sir”.  A classic distraction tactic, well known to any parent with young children, as they watch them toddle off delighted with a tennis ball, forgetting that it could have been the iPad …

To my mind, this was a masterful – and typical – display of ego management, the type of which forms an essential part of getting the best out of the sort of independent, driven but inherently insecure characters that generally make up the Bar.  In order to maintain an effective barrister-clerk relationship, this sort of sensitivity is needed constantly to maintain the precarious balance between demonstrating to the barrister how much they rely on the clerk, while not permitting this to cloud their belief that it is principally their own brilliance that drives their success.  In my view, this belief plays a large part in giving the Bar with its unique potency, so it is important that it is guarded with such skill when it could so easily be dismissed as pointless self-indulgence.

It is great to observe this sort of nuance being depicted – whether intentionally or not – to the far-reaching audience of Silk.  I am sure there will be plenty more to learn throughout the series.  I will be watching you, Billy …

Bar overplays independence card

This is a copy of my recent article for Legal Cheek, a legal news and comment website full of lively, provocative and informative material.  And this too …

On Monday the listed Australian law firm Slater & Gordon kicked off the Legal Services Act (LSA) era in earnest when it announced its market-wowing £54m acquisition of Russell Jones & Walker. Amid all the excitement about who could be next, it’s easy to forget that it’s not just law firms considering the potential threats and opportunities arising from the fast evolving landscape, but also barristers’ chambers.

Not that barristers chambers are exactly in the hot seat when it comes to LSA-led change. Being predominantly a referral-driven business, chambers tend to adopt a “wait and see” approach based on any changing requirements arising from what the referring law firms are doing. Of course, there’s risk in this approach as it relies on sets being sufficiently agile to adapt rapidly when required.

Chambers’ ability to move fast is far from a foregone conclusion – in no small part because the set-up of barristers’ chambers is unlike most other commercial organisations. Steeped so deeply in tradition and moulded around the expectations of the barristers within it, the chambers structure is inherently ill-suited to change, particularly of the swift and radical variety.

Among the characteristics we often hear cited as the Bar’s key strengths are the fierce independence and individuality of its members: independent thinkers working in their own individual ways to unlock that genius, providing uniquely innovative ways of dealing with the difficult challenges presented by advocacy and specialist legal practice. This is what sets the profession apart, we are told, in enabling the breathtakingly high standards of intellectual ability to come to the fore to the benefit of clients and, ultimately, justice.

While I have no doubt that there is some truth in this, I cannot help thinking that the independence card is rather over-played. Of course it helps to provide high professional standards for each practitioner to be able to work in ways that they feel are optimised for their individual needs; like a writer might prefer to sit in front of their favourite view in order to be inspired, or an artist perhaps painting to music of the appropriate mood.

In this respect, individuality is undoubtedly a strength. But it can also be a critical weakness in a climate where one of the emerging challenges will inevitably be the ability of the organisation to adapt quickly and seamlessly to meet demands from the market to provide uniformity in quality and methods of service.

Here, individuality and independence can really hold a business back – especially if they are applied gratuitously. For example, does a barrister’s individuality really need to prevent them from giving a prompt response to an enquiry about availability, the timing of a piece of work or a simple, unqualified answer to a request for a fixed fee quote? Is it really independence that precludes the prompt provision of billing details in a form that fits in with the organisation’s and client’s requirements?

It is too convenient to accept that a hugely variable standard in provision of such essentials is inevitable, given the characteristics of barristers. The legal market seems to roll with it; I wonder, though, how many other industries would be so forgiving, especially with the effort required to conform to some basic organisational principles pretty minimal?

The tendency towards the individual approach is compounded by the structure of chambers and the resulting organisational culture. A set of chambers is a simple business structure consisting of a group of self-employed barristers billing and receiving payment for their own fees on an individual basis. From their receipts they pay a contribution – typically around 15% – towards shared “chambers expenses”, covering normal business overheads such as rent, staff, marketing and IT.

But is it really right to describe these as expenses in the conventional sense of the word? There is no doubt that, in terms of mechanics, each member does indeed part with a sum of money (usually by way of monthly direct debit) in return for a service. Thus from their point of view, there is a sense of paying a fee for a service – and with that comes the resulting entitlement to their “pound of flesh” (which is understandable: as fee paying customers, why should they not be entitled to expect service in a form that is tailored to their personal preferences?).

But this approach doesn’t sit quite right in the context of commercial organisations. In reality, barristers clerks and chambers administration staff don’t provide personalised services in the same way as you would expect from, say, a hairdresser (where you might specify what style you would like) or perhaps a taxi driver (to whom you might express a preferred route or ask for the heating to be turned up). There are two crucial differences. First, in the chambers scenario, barristers are paying for a shared service that comes from restricted resources that need to be used prudently and fairly in order for the system to function. Secondly and more importantly, chambers provides an enabling service; an essential service without which barristers would be unlikely to be in business at all.

Accordingly, I suggest that a more realistic way of looking at the situation would be for barristers to consider themselves part of an organisation where they are paid 85% commission on their sales. That’s a pretty good deal in most businesses. Putting the payment process to one side, this concept better reflects commercial reality. It also demonstrates recognition of the value of being part of the organisation and serves to promote a mindset of strong commitment to the group and a degree of conformity with its way of doing business, with the ultimate goal of providing services to clients in the most effective and competitive manner.

Many law firms are currently having to face up to some difficult threats to their market share, profitability and ultimately survival. Radical changes in strategy and operations are being considered. In contrast, a minor cultural shift and a little administrative effort may well be all that is needed for the Bar to keep pace comfortably with the demands of the marketplace. There is no reason why the Bar’s treasured traits of independence and individuality should not continue to be potent attacking forces, but unless applied thoughtfully they could contribute to the scoring of a decisive own goal.

What they don’t teach you at Bar School

Let’s be clear here.  I genuinely do not know what they do teach at Bar school.  Some law stuff and a bit of advocacy I guess.  I’ve never really known much more than this and I’m not sure if it’s relevant to my day-to-day business of managing and promoting a set of chambers. If it is, well, too late …

I know that becoming a barrister involves a pretty long slog academically followed by the immensely tough challenge of finding a pupillage and ultimately a tenancy.  There can be no doubting the rigour of this process.  Having come this far, a barrister can be forgiven for assuming that they have done all the hard work and that success in practice is a foregone conclusion.  It is indeed an impressive achievement, however it arguably leaves them ill-prepared for many of the fundamental challenges ahead such as the practical, real world application of legal expertise, developing relationships and building a successful, progressive and sustainable practice.

The weakness of pupillage

These vital skills need to be developed from beyond the formal education process, which starts with the transition phase from qualification into practice, pupillage.  This involves spending a year under the supervision of a small number of different barristers who meet the “pupil supervisor” requirements.  These requirements are hardly stringent and the supervisors themselves are there by virtue of an identical process, with equally little guidance in the non-academic aspects of legal practice.  They may or may not have since picked up the right commercial and practical skills to be considered a good example, yet this does not seem to be a factor in their eligibility for this role.  This makes it something of a lottery whether or not a pupil is placed with someone able to set the right example for someone newly facing a changing legal marketplace.  The problem here is that the pupillage process is regarded as one in which the pupil is encouraged to follow their supervisor, rather than view them in any way critically.  In this respect, it is wrong to assume that the supervisor’s strong reputation or financial success means they are someone suitable to set an example: many outstandingly academic barristers have in the past achieved such successes in spite of practical shortcomings.  I doubt that the modern marketplace will prove to be so forgiving.

I ought to add here that I am not for a moment advocating that a pupil be vocally critical of their supervisor – that would be a surefire form of career suicide - merely that they should look to learn from their weaknesses as well as their strengths.  You can be sure that they will have weaknesses.

Barristers have been blindly following each other through this system for generations, so it is no wonder why the Bar is perceived as a  group where change comes very slowly.  But evidently this tried and tested formula is a successful one, despite my misgivings, as here we are in a legal marketplace where the Bar holds an enviably strong position.

What I do know is that if I were starting in practice now, I would want to see leadership, guidance and critical appraisal from a variety of angles in the early stages of practice, rather than simply to follow a self-perpetuating system led by those who possessed what may have been a formula for success at the Bar ten or fifteen years ago.  This is not to say those individuals would not be equally successful if entering the Bar now, but the question is how do we know ?  This is not, I suggest, something that should be left to chance.

Ethos

So what is the right way to go about building the foundations of a practice ?  Most of the genuine success stories I have seen at the Bar have not been down to a clever marketing and business development strategy.  Nor from wining and dining solicitors or social-climbing among the legal fraternity.  Not from being the cleverest lawyer out there.  And not even from buttering up the clerks (although I would not discourage this admirable practice …)

No, most of the examples I can think of of genuine, sustained success at the Bar have one thing in common: a fundamental ethos of pure, uncompromised focus on, enjoyment of and passion for solving legal problems – whoever the client, whichever firm instructing, whichever court or tribunal, whatever the state of the instructions and whatever the fee or funding basis.  Such an approach soon makes excellence become an enjoyable habit.  This in turn generates an appetite for work that enables volume and thus variety of opportunity for increasing experience as well as exposure in the marketplace: optimal visibility to professional & lay clients, both instructing and opposing, to judges, other barristers, witnesses and other observers in court.  They all have a voice and with this approach applied consistently the potential for reputation growth increases exponentially, maximising referrals, building experience while in the meantime excellence becomes the norm for your way of practice.

In contrast, seeking to selectively impress, to manufacture a practice, to chase the big-ticket work or the glamour law firms creates a distraction from the real business of committing to excellence.  The practice that you seek will find you naturally in time if you make consistent excellence in service the priority over the temptation for seemingly shorter routes to success.  Of course it remains essential to devote time and effort to properly focused marketing and sales activities, but it is important to remember that this process will only ever bring opportunity (in the singular – you usually get only one chance to impress, before clients look elsewhere in this crowded market).  This in itself will not build a practice for you.  Only referrals will do this and these come from using opportunities to provide exceptional service experience for your clients.

Client Focus

Client focus is a phrase that is often quoted as the key for success in legal practice.  Genuine focus on your client’s needs.  But we all care about our clients, don’t we ?  Well, what does client care really mean in practical terms ?  Here are a couple of random illustrations :

• A business client needing some advice in order to make a strategic decision at a board meeting tomorrow needs the best advice you can give, for that purpose, before that meeting.  Your perfectly researched detailed opinion on how to win at trial, delivered the day after tomorrow, on expensive paper with pretty spiral-binding, may be very clever but its value to your client at this point is likely to be limited to wrapping fish and chips. (And that’s only if they can remove the binding, which can be quite tricky).
• When a client asks for an invoice, this is not an insignificant, irritating bit of admin that is subordinate to the real business of legal excellence.  In fact, they need to know quickly how much money needs to come out of their account, because cash flow is rather important to the running of business or personal finances.  Both solicitor and lay client may well have systems in place for processing payments with people being paid to run them who may be wasting time waiting for this information.  It is important to them.  More so than it may obviously appear to you.

Diverse and simplistic examples perhaps, but deliberately so.  The key message is clear.  Taking the trouble to understand and act on what genuinely matters to your client is the essence of what client care is and this comes in so many more forms outside what you might regard as your primary focus.  Possessing a mindset where you can visualise what your client needs – as opposed to what you want to provide to them - is a key skill.  When applied, it gets you noticed and can provide a genuine competitive advantage in the marketplace.

Practice Development

Practice development is another one of those phrases that sounds like a good thing to do, but nobody quite knows what it looks like.  Of course, success in practice development depends very much on each individual’s goals and aspirations, but I think common goals for most barristers might be progression, challenge, variety and financial security.

Progression is a difficult one to put your finger on.   Milestones can be identified specific to each practice area and can usually be defined by levels of complexity, value or perhaps tribunal, with small stepping-stones between one stage and the next, with a leap of faith being required at some point on the part of a client prepared to send you into personally uncharted territory.

Let me make clear that fee income is a very flakey way of measuring success.  I wish I had a pound (no, let’s make it £1.50 and increase it to £1.75 next week for no justifiable reason…) for every time a barrister suggested “progressing” their practice by increasing their charging rate.  Increase the rate to increase income, an obvious route to success – provided you are operating in a completely ignorant marketplace.  Perhaps this was once the case but right now the legal marketplace is anything but ignorant and indeed is rapidly increasing in sophistication.  This sort of short-term approach to fees can be extremely damaging, particularly in the earlier years of practice and any modicum of commercial reasoning dictates that it should be resisted.  The fact is that the market will dictate the sort of fees you can charge and if you can progress to the right areas of the market, the work will attract higher fees.  But you have to do the hard work to get there first.

The simple answer to what really indicates the successful development of a practice is referrals.  It starts with repeat business from a particular client, developing over time into more widespread “word of mouth” referrals.  There can be no more clear and reliable indicator that you are doing something right than if someone chooses to put their trust in you again, and more so if they put their reputation on the line to recommend you to someone else.  This is what every new barrister should have foremost in their mind in their early years as the most important yardstick for progression and as they key ingredient for a solid platform for long term success.  I really cannot stress this enough.

It’s really quite simple, isn’t it ?

In putting together this post, I have simply and somewhat randomly set out what have seemed to me over the years generally to be the most common issues of weakness displayed by barristers in practice.  To me, they really do seem obvious and straightforward, to the extent that reflecting on this post I am wondering why I even need to spell them out.  I mean surely during the course of one of the most arduous and demanding journeys to becoming a member of such a highly respected profession, someone must teach them this stuff.  Mustn’t they …?