Interview: John Clarke

Apocalyptic visions of the future delivery of legal services brought about by advances in information technology as expounded by Richard Susskind and others may still seem too remote a prospect to warrant serious consideration by a profession which is already enduring tumultuous times.

Not so at Pagan Business Law, based in Cupar, Dunfermline and Edinburgh, as a trading division of Pagan Osborne, where partner John Clarke exemplifies their enthusiasm for meeting the challenges of an uncertain future in which sophisticated IT systems will facilitate widespread access to legal guidance, and not necessarily delivered by lawyers as we presently know them.

“Nobody knows how things will change. I’ll be leading a strategy meeting within our firm later this year, discussing e-commerce generally and trying to envisage what business will be like in five years.

“It’s very difficult to anticipate what will be happening, but out firm and the legal profession generally need to be in a position to embrace change wholeheartedly. Much depends on the entrepreneurial skills of the owners and managers of firms.”

As a former chairman of the Scottish group of the Society for Computers and the Law, and a member of the Law Society of Scotland’s Committee examining the implications of e-commerce, John Clarke is well placed to assess the profession’s readiness and willingness to adapt to a changing climate.

“On the whole, the legal profession is not well prepared, but it is encouraging to see the numbers showing an interest. Theoretically, large firms should be better able to survive due to the breadth of work they undertake. However their margins are under as much pressure as the rest of us and it’s possible that smaller firms will be able to be more pro-active to meet the competition and change direction quickly, should the need arise,” said John Clarke.

“I envisage threats to all sorts of business across the board, particularly to legal services that can be made into a product and distributed on the web. To some extent that is happening already. I do have some concerns about situations in Scotland where people go to the web to research a legal problem and find out about their rights under Alabama law. Most customers might not care about jurisdiction. Scots law is not relevant to them.”

John Clarke is happy to admit his views have been shaped by arguments advanced by Richard Susskind in his hugely influential book The Future of Law, in essence that lawyers will have to offer “punchy, jargon-free advice” and added value services in order to compete with the volumes of free on-line legal information which will serve to liberate the vast numbers who presently have little or no access to legal guidance.

For John Clarke, Susskind’s analogy where intermediaries such as travel agents and insurance brokers, so-called “middlemen”, are largely replaced by on-line information providers, could equally apply to lawyers.

“To some extent we are intermediaries in transactions, capable of being marginalized by data on the Internet. As lawyers we might have to offer a ‘concierge’ service, where our mark-up costs will be less, a service for people who don’t have the time to find the information they need on the web.

“In the future it seems likely lawyers will continue to enjoy two main areas of continuing work, when what is being produced cannot be converted to a product and where we can add value to the product. This will impact on the way we charge for work and lawyers will have to be innovative where much of the information is free on the web. For the legal profession to thrive we might have to follow more closely American charging methods, for example adopting fee-sharing arrangements in litigation.

“Lawyers have to get away from treating what they sell as a commodity and instead persuade the purchasers of our services the value we add and build up personal relationships with clients. We need to convince people of the added knowledge and value that we can offer, intellectual input not information, know-how not facts, that it is impossible to provide on the web.”

He points out that at the moment some building societies in England are able to offer electronic discharge of securities and that there is now virtually no area where there is the need to physically sign something.

John Clarke has sympathy for firms that are apparently impervious to the modern industrial revolution that we are living through and the threats and opportunities that might bring.

“There are a lot of pressures on legal firms and some may be burying their heads in the sand. They know they should be doing something, but other pressures such as the price competition on domestic conveyancing or the squeeze on legal aid fees prevent them from giving IT issues further attention.”

Susskind’s vision sees competition to lawyers coming from a wide variety of “legal service engineers”. John Clarke agrees this could mean publishers or web sites which can offer pro forma contracts on-line, with guides for completion, little different from will forms available in stationers.

He identifies a major problem with web-based legal services as being that “you never really know who you are dealing with”, but expects “competition will come from ways we haven’t yet thought of.”

However for firms based in places like Cupar and other outlying areas, it could be that as e-commerce and web-based services take hold, physical geography might become less relevant in attracting clients.

“The critical thing is to attract people to your website and geography shouldn’t matter as much. But getting people to log on to your site will still have to be achieved via traditional media or by links to other websites.”

Pagan Business Law developed as part of the wider Pagan Osborne name when “it was evident we had the skills to do more corporate and commercial work that we were attracting locally.

“However our property teams had been so successful that the local public assumed we only dealt in domestic properties. The Business Law brand allows us to use different colours and styles linked to the parent firm, undertaking corporate acquisitions, mergers and venture capital work.”

For many clients this means offering advice on the implications of e-commerce. “The advice is not dissimilar to that given to clients in the past on how they organise trading terms and conditions.

“But for e-commerce there is an extra later of regulation at national and European levels. One of the problems in advising on e-commerce is the pace of change in the industry” (an Internet year is reckoned to be only three or four months in conventional terms at present levels of progress).

As an additional service to clients and serving also as a valuable learning tool for the firm is their membership of AVIRO, a network of European countries. John Clarke has recently been elected as the group’s Chairman and Secretary General.

“Membership brings three main benefits. Customers external to our jurisdiction approach us to undertake work upon recommendation by other member firms, when ordinarily they would have to pick us randomly from a directory.

“For our existing Scottish-based business we can offer a better service, giving them a link to legal advice from trusted sources across Europe and to the knowledge we have of other jurisdictions across the continent. For example, a client with a subsidiary in France was likely to breach their employment laws but with the insight I had obtained at the AVIRO conference I was able to inform them of their impending breach and point them in the direction of my French colleague.

“The changes membership has brought to our thought processes and perceptions, and the ideas it has given us on marketing the firm are perhaps not as obvious, but represent ongoing benefits. AVIRO has developed from being a means of representing clients and getting an insight to jurisdictions to developing common areas of expertise and specialisation, at the moment primarily in sports law (a strength of AVIRO – Luc Misson, a Belgian colleague, was Jean-Marc Bosman’s lawyer, and AVIRO held its first international sports law convention in Bonn on 4 and 5 November at which John Clarke and Pagan Osborne colleague Stephen Cotton both spoke) but with a growing expertise in international fraud. I think all of us involved in AVIRO have become more rounded people as a result.”

In The Future of Law Richard Susskind writes “the law is no more there to keep lawyers in business than ill health is there to provide a livelihood for doctors. I am confident at the same time that all manner of new opportunities will arise for lawyers”. No-one yet knows who will grasp the new opportunities, but it’s fair bet that wherever John Clarke is at the helm won’t be left lagging too far behind.