Recession: Quo Vadis?

Most lawyers are risk-identifiers, not risk-takers. Our training in stare decisis makes us believe that you can only find the future by studying the past. We walk through life backwards.

Charles F Robinson, Stampede to Extinction

It is customary when the year draws to an end to look back at what we have achieved before setting out towards a new year. I have done this elsewhere - in this year's Law Society's Annual Report. Instead, my focus shall be the future because, as Albert Einstein once said, I intend to spend the rest of my life there.

It is trite knowledge by now that the environment has changed the way we practise law, and this really has been driven by five key factors: (1) advances in IT; (2) effects of globalisation; (3) changes in competition and government regulations for more transparency; (4) advances in science; and (5) changes in social attitudes.

Some of the key possible changes include: (a) the internationalisation of legal practice at the top end of commercial transactions; (b) the commodification of law and increased competition from legal service providers;
(c) deregulation of markets that will lead to increased competition from overseas and non-traditional providers of legal services; (d) greater public expectation of pro bono services; and (e) an ongoing tension between business and professional aspects of legal practice, focusing on the adequacy of existing ethical rules.

With these will come changes to the way we practise law as we know it. As I see it, some of the potential changes to ways of practice will include lawyers having to ensure that the focus of legal practice is more on the client's needs and the provision of value-added services.

We may need to consider billing practices based on value and not just hours, as clients will be more results-oriented and less impressed with the mechanism employed. As such, we shall have to consider using technology to free up time.

With the current economic situation and the focus on training our staff, this may include exploring new roles for our support staff, engaging them in the role of para-legals and not being confined to just secretaries or scribes. Another opening, especially for smaller law firms facing increased competition and possible extinction, is to consider options for specialisation and niche marketing, along with development of formal and informal networks, both locally and internationally.

An important challenge facing the Law Society continues to be its role in educating the profession for the future. Some of the possible initiatives may include going beyond mere continuing legal education to more hands-on courses in the form of Practical Legal Training ('PLT'). This can be further developed by firms running such courses in-house, and not just for their practitioners but also para-legals and support staff, encompassing value-added support services. It is gratifying to note that some of our larger firms have already begun this training.

In time, and I believe it will only be a matter of time, we shall see the integration of PLT into undergraduate courses at the university. However, the provision of such training should not shift the focus of legal education to being purely motivated by increased material gains for the individual. Ethical rules and cardinal principles which exist to ensure the practice of law remains a calling and profession must always form a firm foundation on which our future lawyers carve out their living.

Hand-in-hand with the inculcating of practical skills, we should consider effective methods of integrating ethics into law undergraduate curricula, including the involvement of practitioners in the teaching of the same. Finally, we should not only provide continuing legal education, but monitor its provision both in terms of quality and range.

This brings me to the identification of what I see as potential growth areas of practice. One area is of course e-commerce, cyber law and related fields. International commerce, including trade law, mergers and acquisitions, taxation and capital financing is another growth area, although to be tempered in the current economic slowdown. Biotechnology and other sciences, technology and related work is a new industry.

Although dispute avoidance and risk management may seem anathema to a profession that strives on conflict, I see an area that has remained fairly untapped. Work in the Asian Market, in particular, China, is certainly going to see much activity in the near future, and Singapore is well-poised culturally to rise to the challenge posed by the China market. With the developments in biotechnology and the new sciences, intellectual property law will see the continued defence of old rights and creation of new ones.

Conversely, we should also identify as potential declining areas of practice those routine aspects of law which are likely to be commoditised. The writing has been on the wall for some time now but increasingly, traditional legal services will be displaced by standardised forms - possibly in electronic form - used both by the profession and non-lawyers.

There will also be ongoing tension between commercial and professional aspects of legal practice - tension which will be highlighted by increased consumer awareness of their legal rights, increased competition from overseas, increased competition from outside the legal profession and change within the profession itself, as it diversifies the range of services offered to meet the competition pressure.

In all this, what are the challenges for individual practitioners and firms?

Small firms should use technology to assist productivity and provide commoditised legal services, attract new clients through alliances and new business structures and examine niche markets and specialisation.

Mid-size firms should develop networks and alliances, consider specialisation, consider mergers, both within jurisdiction in Group Legal Practices ('GLP') or form such alliances within jurisdiction to venture abroad for outside marketing.

Large firms should consider incorporation, possible mergers or collaboration with either large foreign law firms or one of the big five accounting firms, consider providing a wider range of business-related services and look into expansion into overseas markets.

For the Law Society, our challenge, inter alia, will be to identify and develop an MDP policy to ensure no diminishing of ethical or professional standards, whilst at the same time develop human resource policies to help our firms ride through these tough times in a cost-effective manner.

To quote Sir Maurice Byers QC, 'an independent Bar has become an essential feature in the administration of justice. If we maintain our rights, accept our responsibilities and realise that accountability for what we do is the prize of controlling our destiny, all will be well'.

For decades, our economic recovery has proved pessimists wrong. It will probably do so again. But it will be a battle to overcome - not an easy one this time round. Together, we can, and must, noting that we still play the role of risk-identifiers.

Palakrishnan, SC
President
The Law Society of Singapore

Revised from the President's Address delivered at the Law Society's Annual Dinner and Dance on 20 October 2001.

Your President Listens Members of the Law Society will continue to have the opportunity to meet Mr Palakrishnan, SC, President of the Law Society (who has been elected to his third term of office), at his fortnightly Saturday sessions at the Law Society's premises between 10.30am and 12noon. The sessions next month will be on 5 and 19 January 2002.