Non-Lawyer Ownership in Law Firms

by Timothy B. Corcoran on April 22, 2009

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In today’s Birmingham (UK) Post, we learn that the law firm of Blackbourn & Bond have appointed a new director of business development.  Law firms hire marketing and business development professionals all the time, so what’s newsworthy about this?  Mark Callahan, the new hire, is not a lawyer (he’s a “non-lawyer” to BigLaw insiders) but he holds the distinction of now serving as an owner of the law firm.

Under the recent UK legislation known as the Legal Services Act, UK law firms may now move along the continuum toward more conventional businesses and may take in external capital and share fees with owners who don’t practice law.  Traditionally, as readers of this blog undoubtedly know, law firms operate as a partnership with only practicing lawyers allowed to have an ownership stake and share in the fees.  This is a welcome change, at least to anyone who has worked closely with BigLaw and has witnessed the colossal waste and inefficiency that takes place as very smart, very capable but extraordinarily inexperienced lawyers play dress-up in running a large enterprise.  (We don’t mean to offend. Of course there are many fine law firm leaders. But the greatest challenge lies at the practice group level, where managing the business is often treated as a distracting hobby.)

But is it only about operating more efficiently?  Of course not.  The entire point is to better serve clients.  As Callahan points out, “This will also ensure that [the lawyers] concentrate on what they do best; advising clients on business and commercial property law.”  Nick Blackbourn concludes, “This will in turn assist us to develop the firm, and become even more commercially focused as lawyers for business.”  Hear, hear.

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