The Solicitors Regulation Authority (SRA) today announced that it has licensed its first three alternative business structures (ABS).
The trio comprises Co-operative Legal Services (the organisation uses Eclipse’s Proclaim Case Management Software), John Welch and Stammers, and Lawbridge Solicitors Ltd.
An ABS is a business providing regulated reserved legal activities but which has either, or both, non-lawyer owners and managers. Traditionally law firms have had to be owned and managed only by lawyers.
The non-lawyer ownership and management of legal services providers — under the Legal Services Act 2007 – was one of a significant raft of reforms designed to liberalise the regulation and provision of legal services in England and Wales. The reforms will increase competition and provide consumers with greater choice and access to legal and related services.
The SRA started accepting ABS applications three months ago on 3 January 2012, after being designated a licensing body by the Ministry of Justice in December 2011.
Co-operative Legal Services is part of the Co-operative Group and was set up in 2006, but, until now, the range of services it could provide has been limited to personal injury claims; will writing; probate and estate administration; conveyancing and employment law. Co-operative Legal Services currently employs around 400 staff and is in the midst of a recruitment drive which will see at least 150 more employees join this year. ABS status will allow it to diversify into family law later this year as well as considering how else it can meet the needs of consumers.
John Welch and Stammers has seven fee earners and eleven support staff and has been operating in Witney, Oxfordshire since 1932. ABS status will enable the firm to continue and develop, as one solicitor partner retired in December 2011 leaving two solicitor partners and Bernadette Summers, who has been practice manager for the past 12 years, will be appointed as a non-lawyer managing partner. The firm is a general solicitors practice offering services in domestic and commercial conveyancing, family, personal injury, civil litigation and Wills and probate.
Lawbridge Solicitors Ltd is an existing incorporated recognised body, which has just one solicitor/fee earner, Michael Pope. His wife Alison, currently the practice manager, will become a director of the firm with a significant shareholding. The business is based in Sidcup, Kent, with a local client base, and offers a mix of employment work, litigation and commercial/corporate legal services.
Antony Townsend, SRA Chief Executive, said: “We’re delighted to announce the first ABS organisations. This represents a milestone we have been working towards for nearly two years.
“The arrival of ABS should foster a more flexible and innovative market for legal services. By stimulating competition and encouraging innovation, we should see consumers’ experiences enjoy a major boost.
“Some people may be surprised that there are two high street practices with a handful of staff among the first wave of ABS organisations that we’ve authorised. But we’ve always said that ABS offers options for all firms, not just large organisations.
“We’ve had to create a system of authorisation flexible enough to deal with a range of companies with hugely varying corporate structures, but that’s also robust enough to apply the same stringent suitability criteria by which traditional firms are judged. We make no apology for ensuring that the systems we have in place are thorough and in some cases, time-consuming.”
Jonathan Djanogly MP, Justice Minister, added: “This is a huge milestone for UK legal services and the future of Alternative Business Structures. “ABSs introduce more competition in the market place, delivering competitive pricing, higher standards of product and more choice for the consumer.
“Our UK legal services are unrivalled around the world and these changes will allow them to reach new heights, as solicitors’ firms develop new markets, seek external investment and join up with other businesses to offer different products to consumers and provide opportunities for growth.”
Eddie Ryan, Managing Director of Co-operative Legal Services, said: “When the Legal Services Act was first drafted it was envisaged it would enable well-established consumer brands to enter the closed world of legal services. We believe the presence of The Co-operative’s trusted brand and values together with a combination of first class products and services will provide customers with greater accessibility to legal advice and better value for money. That is why we are committed to playing a leading role in this new era by offering straightforward value-for-money legal services, backed by an ethos of social responsibility and a level of protection that can be provided by a diverse, multi-billion pound organisation.”
Kerry Joels, of John Welch and Stammers, said: “We have for a number of years wanted to introduce Berni Summers into the partnership as recognition of her major contribution to the development and running of our firm and are delighted that by becoming an ABS we can achieve this.”
Alison and Michael Pope from Lawbridge Solicitors Ltd added: “We are very pleased to be one of the first firms to be authorised as an ABS. It was always our intention to take advantage of ABS as a means of allowing joint ownership of the firm, and to use this as a platform to raise our profile and move forward to expand the firm.”
The SRA will continue to process the completed Stage 2 applications it has received from organisations across England and Wales. Around 60 Stage 2 forms have been submitted so far after initial interest from nearly 180 applicants.