The good news is that several international firms have clinched the Qualifying Foreign Law Firm (QFLF) licenses to set up their law firms in Singapore. 4 UK firms and 3 US firms, namely Allen & Overy, Clifford Chance, Herbert Smith, Latham & Watkins, Norton Rose and White & Case have won the licences ahead of 14 other firms. The total of 6 licenses given out were an increase from the original 5 licenses that were up for grabs.The scheme gives the foreign firms the right to practise Singapore law in permitted areas through Singapore-qualified lawyers employed by them. Previously, foreign firms could only practise through a joint law venture. As announced a short while back, Clifford Chance had broken off its joint law venture with Wong Partnership, undoubtedly because it had already submitted its proposal to get the QFLF and perhaps there were already indications that it had succeeded.The bad news for the legal market is that the wave of lay-offs in the US and UK legal market will likely hit the Asia-Pacific region. ALB is of the opinion that the question is not if the Asia-Pacific legal services market will be hit by this wave of redundancies but when.ALB reports on the talk that one of Singapore’s most prestigious capital markets and M&A practices had already kicked a number of its lawyers to the kerb in an effort to reduce costs. I have also heard some mention of Singapore law firms thinking about not paying out bonuses for this year. Would have been previously unimaginable hearing talk like that.
Category Archives: lawyer
Necessity of Commercial Knowledge
An interesting Times online articlefeaturing the lack of commercial knowledge among the trainee lawyers at Freshfields. The lawyers there are of course practicing solely in commercial areas of practice and 15 questions were set out to test their commercial knowledge. The average score came back at 43%.I have taken a look at the questions and they aren’t that easy. No way I would have scored high on that quiz. Here in Malaysia, a lot of people practice in some form of commercial practice, but there may not be enough emphasis in pushing for lawyers to also maintain a broad base of business knowledge and being in tune to current events.
Quoting from the Times article:
An e-mail sent to the trainees later by an unnamed graduate recruitment officer called for an improvement in their general business knowledge and suggested that they would be tested again. “A person who claims to be a commercial lawyer but who doesn’t have much of a handle on what is going on in the commercial world isn’t, in the end, going to be fantastically credible to clients,” it said.
Legal Lay-Offs
With the credit crunch continuing unabated around the world, the crisis has now left UK and US law firms reeling in its wake. The number of lay-offs keep piling up.Over in the UK, Hammonds has hit 95 and Eversheds clocks in with two redundancy consultations, with the first round having 33 jobs under the chopping block and its second with 45. On the other side of the Pacific, US firm Orrick Herrington & Sutcliffe will be laying off 40 associates and counsel and White & Case has measured in with 70 lawyers.
While areas linked to real estate practice has been pretty badly hit, the lay-offs are also hitting corporate lawyers doing M&A work for instance.
Entry of UK Law Firms into Singapore
It is interesting to see that the present slowly in the economy has not quite dampened the impending entry of foreign law firms into Singapore. Legal Week reported that at least 6 UK law firms have applied for the 5 Qualifying Foreign Law Firm licences up for grabs, in order to set up shop and practice Singapore law. These firms include Ashurst, DLA Piper, Herbert Smith and Norton Rose. Clifford Chance and Allen & Overy, despite having a JLV presence in Singapore, are believed to have applied as well.The presence of the foreign law firms should continue to boost the legal job market in Singapore.
Plugging the Legal Brain Drain
(from The Star, 26 September 2008)Thirteen thousand. That is roughly the number of lawyers currently practising in Malaysia. It gives the impression that there are more than enough lawyers here. So why should we worry if a few hundred, or even a thousand, lawyers leave the profession to work in other jurisdictions?
Around 1,000 new lawyers join the profession annually so shouldn’t there be plenty of legal talent here in this country?
There is, however, cause for worry. Increasingly, law firms are complaining of a general decline in the quality of lawyers entering the profession. Our brightest and best law graduates are choosing instead to practise in other countries.
Further, the pace of lawyers leaving Malaysia for other jurisdictions like Singapore, Hong Kong and the Middle East appears to have also accelerated, and this exacerbates the legal brain drain that we are facing.
In her Putik Lada article ‘Not as Glamorous as Boston Legal’ (The Star, Aug 15), Melissa Tai touched on some of the problems the profession faces in attracting and retaining legal talent. What I will be setting out is a wish list of sorts and some solutions to this problem.
Wish List
At the top of any lawyer’s wish list would be the obvious factor of higher pay. Undoubtedly, other jurisdictions offer a significantly more attractive remuneration package, even after factoring in the higher cost of living.
It is accepted that present market forces result in relatively low legal fees being charged, which in turn contributes to a relatively low amount of pay compared with other jurisdictions.
The difficulty in attracting lawyers to stay in Malaysia goes beyond the issue of pay. One of the strong appeals of working overseas is the opportunity to be exposed to more international and high-calibre work. There is no easy answer to this, as other countries like Singapore, for example, also grapple with the same issue of lawyers leaving for this reason.
One possible solution could be a controlled liberalisation of the Malaysian legal market to allow foreign law firms to practise in Malaysia. This may help to provide international exposure within a local setting. This idea has been in the pipeline for many years and it remains to be seen when it will be implemented.
Steps which law firms themselves can take would include a change in the work culture and the general improvement of the work-life balance of their lawyers. Firms may need to restructure the work and careers of their lawyers to meet both the firm’s needs and the lawyers’ personal priorities.
Law firms must also recognise that up to 70% of the younger lawyers are women and that part-time and flexible work arrangements have to be offered. The existence of family-friendly parental leave schemes would be more beneficial than having such talent leave practice altogether.
Bringing back respect to the profession
Taking a step back from what law firms can do, there is the more over-arching issue that must be addressed. Respect must be brought back into the profession in order to continue to attract and retain our brightest talent.
Firstly, the starting point has to be the improvement of the quality of law graduates entering the profession. Hence, the announcement of a Common Bar Examination is welcomed and it must be compulsory for all graduates, whether from local or foreign universities, to pass the Common Bar Course before they are admitted to the Bar. Everyone has to go through the same gatekeeper, and higher standards can be more easily maintained.
The implementation of the Common Bar Course would have to go hand-in-hand with an improvement to the present pupillage system. Pupillage is the compulsory nine-month period in which a law graduate undergoes training with a senior lawyer to gain practical experience before being admitted to the Bar.
A proper pupillage structure for the determination of certain core skills, the teaching of such core skills by the senior lawyer or the law firm, and an assessment of such skills must be put in place.
Secondly, an essential aspect of bringing back respect into the profession is the need for an efficient and strong judicial system. The frustration of having cases unduly postponed or court hearing dates being fixed more than five years down the road will drive lawyers away from practice in Malaysia.
The surfacing of images of a lawyer apparently brokering the appointment of judges leads us to question the integrity of the judicial system. The sluggish investigation into the findings resulting from this apparent brokering of judges and the stalling of the implementation of the Judicial Appointments Commission also raises doubts on the sincerity for judicial reform.
Conclusion
The fall-out from the subprime crisis has resulted in large lay-offs from major law firms in America and in England. China, post-Beijing Olympics, may well also experience some slowdown. The effect of these events is that it may result in a brief respite from the exodus of legal talent from Malaysia as job opportunities in other jurisdictions may become harder to come by.
But immediate steps must be taken to allow us to continue to attract and retain our legal talent. The solutions I have touched on are not exhaustive but may well go a long way to plugging the legal brain drain we are experiencing.
eLawyer Legal Blog Writing Contest
eLawyer is holding what could be the first ever legal blog writing contestin Malaysia.
The topics you can select from are:
1) Towards an independent judiciary in Malaysia
2) Common Bar Exams: The creation of a new problem or a solution for an old one?
3) Welcome CheDet.com: the impact of Tun Mahathir’s blog
4) Anti-party Hopping Law- Agree or Disagree?
You are to send in an entry not exceeding 1,000 words and you stand to win up to RM 500 cash! Successful entries will be featured in an exclusive section on the eLawyer website. You’ll have to sign up for free as an eLawyer member to participate.
I have been invited to be a judge of the contest and I am privileged to have with me as judges as well, Dr Azmi Sharom from the University of Malaya and Fahri Azzat.
Hope you all support the contest and send in your entries!
The Implied Undertaking Rule
An interesting read, Allens Arthur Robinson’s update on the implied undertaking rule which was affirmed by the recent Australian High Court decision of Hearne v Street[2008] HCA 36.The implied undertaking rule is that a party receiving documents in litigation holds them subject to an implied undertaking to use them only in the proceedings in which they were produced. The reasoning behind such a rule was explained by Denning in Riddick v Thames Board Mills Ltd [1977] QB 881:
“A party who seeks discovery of documents gets it on condition that he will make use of them only for the purpose of that action, and no other purpose.
…
Compulsion [to disclose on discovery] is an invasion of a private right to keep one’s documents to oneself. The public interest in privacy and confidence demands that this compulsion should not be pressed further than the course of justice requires. The courts should, therefore, not allow the other party – or anyone else – to use the documents for any ulterior or alien purpose. Otherwise the courts themselves would be doing injustice.”
Hearne v Street summarised that the implied undertaking rule applied to all documents and information that one party to litigation is compelled, whether by reason of a rule of court, a specific order of the court or otherwise, to disclose, including:
(i) documents inspected after discovery;
(ii) answers to interrogatories;
(iii) documents produced on subpoena;
(iv) documents produced for the purposes of taxation of costs;
(v) documents produced under a direction from an arbitrator;
(vi) documents seized under an Anton Pillar order;
(vii) witness statements served under a judicial direction;
(viii) affidavits; and
(ix) expert reports.
The implied undertaking is usually released once the relevant material is tendered or read in open court. A breach of this implied undertaking (which is given to the Court) would mean that a party is in contempt of Court.
Application of Implied Undertaking Rule
Let me just highlight some issues and the application of this rule in the context of a shareholder dispute.
A shareholder who is not a director, or a director-shareholder who has been denied access to company documents, will not have access to crucial documents to help evidence any of his complaints. A shareholder may wish to bring an oppression petition under section 181 of the Companies Act 1965 to seek for a share buy-out or other reliefs. One of the drawbacks of a petition is that there is no automatic right to discovery. In fact, in See Hua Realty Bhd v See Hua News Holding Sdn Bhd [2007] 7 CLJ 152, discovery of documents in the oppression petition was disallowed.
Would the new statutory derivative action provisions assist such a shareholder? The new provisions allow for wide ranging powers for inspection and to effectively order discovery of documents at the leave stage. At a talk I attended, it was suggested by a senior corporate litigator, that he did not see the inconsistency in bringing a section 181A statutory derivative action for the specific purpose of discovery, and to have an oppression petition run in parallel. This was to get over the hurdle and difficulty of obtaining discovery in the oppression petition.
However, I would think the implied undertaking rule should strictly apply in preventing the use of any documents obtained under the section 181A proceedings for use in the oppression petition proceedings.
Similarly, if the shareholder agreement contains an arbitration clause, any order for discovery by the arbitrator (or even interim order for discovery to be granted by the Courts under section 11 of the Arbitration Act 2005) should mean that the documents or evidence can only be used within the arbitration proceedings and not be used for other litigation proceedings.
That means a shareholder may have to continue to grope in the dark and not be able to have access to documents to evidence at least some of the complaints the shareholder may have.
Tony Blair’s Upholding the Rule of Law: A Reflection
I was in attendance at the Mandarin Oriental on Friday to attend the 22nd Sultan Azlan Shah Law Lecture series. The speaker for this year was Tony Blair, former PM of the United Kingdom, and he would speak on the topic ‘Upholding the Rule of Law: A Reflection’.
It took a while for Blair to delve into the topic proper, although it was still entertaining to hear him speak about his barrister days and his eventual move into politics.
Very quickly, you could tell that Blair adopted a very utilitarian approach to his topic on the Rule of Law. You may first ask, what is the Rule of Law? A basic description of it would be that no one is above the law. As Dicey would put it, one of the principles of the rule of law is the absolute supremacy of regular law as opposed to arbitrary power. Some of the elements that Blair identified would constitute the Rule of Law is that of an independent and strong judiciary, as well as an independent Bar.
In this day and age of the awakening of China and India and the economic forces they wield, the rise of sovereign wealth funds, and the development of new business sectors, made the Rule of Law all the more relevant rather than it being cast aside. ‘Footloose capital’, as Blair put it, would need an outlet, the growing global workforce would need an outlet to live and work. The Rule of Law would aid in such a process.
“Get good governance. Get a proper judiciary, proper laws”.
“Get a reputation that there is a commercial and criminal legal system that operates fairly and then wait for businesses to come, because they will.”
Blair stressed that a judiciary which was still corrupt indicated the immaturity of a country. A judiciary that became corrupt, was an indicated of a country in decline. He also emphasised that the Rule of Law did not just mean an independent judiciary, but it also necessitated an efficient judicial system. He repeated the oft-used phrase that justice delayed is justice denied. Further, judges could not be tainted with any allegations of corruption. The public’s confidence in the judiciary must be upheld at all times.
Blair also shared with the audience the obvious tension he felt between the executive, in making laws, and that of the judiciary, who interpreted the laws he, as Prime Minister, had crafted. He was almost critical of the judicial activism in making law rather than interpreting it.
He shared with the audience the passing of certain anti-terrorist laws which provided for preventive detention. These laws were eventually challenged in the House of Lords, where the Court declared these laws contrary to the Human Rights Act. He expressed his steadfast disagreement with the decision, but he was also steadfast in agreeing that the Court had the power to make such a decision.
“It is right that they can; that they are above me and not me above them.”
I have to say that Tony Blair is an excellent speaker. His oratory skills and ability to command attention. I cannot say that I enjoyed the content of his speech that much, but it was enlightening though to see the viewpoint from the Executive, from his vantage point of Prime Minister and wishing to create laws with the greater public good in mind, but having the necessary stumbling block of the check and balance of the Judiciary interpreting such laws. The speech hardly broke new ground in academic discourse, but still interesting to listen to Blair speak nonetheless.
The Limited Liability Partnership in Malaysia
IntroductionTraditional business models tend to veer between two options, that of a partnership and a corporation. While a partnership offers flexibility in allowing its members to agree and strike a bargain on the form of its arrangement, a corporation must adhere to a more mandatory framework with a division between its management and its members. However, a corporation enjoys its own separate legal personality with its shareholders enjoying limited liability.Within the practice of law here, legal practitioners can only choose between operating as a sole practitioner or to form a partnership.
A need for flexibility in running a business and to overcome certain limitations in all the above business models have led to the call for a hybrid vehicle to be enacted, that of a Limited Liability Partnership (LLP).
…it combines the protection of limited liability whilst offering a degree of flexibility of the partnership arrangement…
As its name suggests, it combines the protection of limited liability for its members whilst offering a degree of flexibility of the partnership arrangement for the internal management of the business. The most attractive feature of an LLP is that it is a separate legal entity and has a continuing legal existence independent of its members as compared to the traditional partnership of which its legal existence is dependent upon its membership.
The Companies Commission of Malaysia (CCM) has revived the consultation process in relation to the LLP and issued a second consultative document. The CCM recommends that the LLP should be a vehicle afforded to all business and not merely certain professional groups. It believes that the LLP provides businessmen and investors the flexibility to select the best business entity suited for its business.
It has been reported that the CCM hopes to implement the LLP model by 2009.
This article will highlight and touch on the CCM’s recommendations and the likely features of the LLP structure here in Malaysia. The discussion here highlights the proposals of the CCM.
The Conferment of Limited Liability Status
The proposed LLP Act will confer a separate legal entity status on the LLP – one that is distinct from its partners that will come into existence upon registration of the business entity.
Partners of the LLP will be accorded limited liability in respect of tort and contractual claims. However, it will not insulate a partner of the LLP which he would otherwise incur by his own wrongful act or omission, even though such acts were carried out in his role as a partner of the LLP. This is in line with the approach taken in the UK whereby the House of Lords applied the decision in Williams v Natural Life Health Foods Ltd [1998] 1 WLR 830, HL, to LLPs.
The CCM was of the view that that there should be mandatory bonds/insurance for professional LLPs there should be mandatory bonds/insurance. For instance, Article 6 of the Jersey Act requires an LLP to make financial provision for a sum of £5 million to be paid by a bank/insurance company to creditors of the LLP upon the dissolution of the LLP.
Partners of the LLP will be accorded limited liability in respect of tort and contractual claims
However, the majority of the respondents in the first round of consultation disagreed that the bond requirement be mandated by the legislation as the requirement is specific for professionals only and instead, such requirement should be determined by the rule of the relevant professional bodies.
Registration Procedures
Registration will be simplified through the process of a single registration instrument. The CCM proposes that the information to be included in the registration form consists of inter alia the name and principal activities of the LLP, the address of the registered office of the LLP, the names and addresses of the partners and the name and address of a designated partner of the LLP. However, the Registrar may request additional information be included as part of the registration requirement. All this information will be made available for public inspection.
However, the partnership agreement will not be lodged with the Registrar in order to preserve the confidentiality of the agreement between the partners.
Membership Structure and Eligibility
The LLP should have a minimum number of 2 partners with no upper limit to its partnership. In the event that the number of partners drops below the required minimum, a certain grace period can be allowed to achieve the requirement, after which the LLP must cease to operate and be wound up.
Membership to an LLP should be made available to both natural and legal persons, in line with the Partnership Act 1961.
There were some concerns whether all partners to an LLP should be subject to the same disqualification and penalty provisions as that under sections 130 and 130A of the Companies Act, 1965, which is the position under the UK LLP Act. In Singapore however, the disqualification and penalty provisions are only applicable to the persons managing the LLP, who need not necessarily be a partner of the LLP. The CCM’s recommendation is to follow the Singapore position. The person who is involved in the management of an LLP should be subject to the same disqualification criteria faced by directors of companies.
Designated Compliance Officer
An LLP will require a designated compliance officer to ensure that the compliance requirements under the proposed LLP Act are fully adhered to. This will be a similar role to that of company secretaries and directors in relation to the Companies Act 1965.
The designated compliance officer need not necessarily be a partner of the firm. It is proposed that further conditions to be imposed on the designated compliance officer is that he or she must be a natural person ordinarily resident in Malaysia and subject to the same disqualifications criteria under sections 125, 130 and 130A of the Companies Act 1965.
Liability of Partners
Limited liability is to be given to innocent partners only and that it should be clearly stated that the defaulting partner is jointly liable with the LLP for the damage, loss or injury suffered by a third party.
Partners of an LLP should be accorded limited liability in respect of tort and contractual claims. A partner of an LLP should not, by reason only of being a partner of the LLP, be held personally liable for the conduct of other partners or the transactions or liabilities of the LLP.
It is also proposed that in the event an LLP becomes insolvent, a partner’s liability should be limited to the amount of his capital contribution to the LLP subsisting at the time.
Partners’ Authority to Bind LLP
The proposed LLP Act shall provide that partners of an LLP are deemed to be its agents and therefore they may act or represent on behalf of the LLP.
The circumstances in which an LLP will not be bound by acts of its partners are the following: –
…partners of an LLP are deemed to be its agents and therefore they may act or represent on behalf of the LLP
(i) the partner has no authority to act on behalf of the LLP; or
(ii) the third party dealing with the partner is aware of this; or
(iii) the third party does not know or believe that the partner is a partner of the LLP.
In the case of transactions with a former partner of an LLP, such transactions are still valid transactions binding the LLP unless the third party has actual notice that the partner is no longer a partner of the LLP at the time of the transaction.
It has been recommended that only actual notice will suffice and that constructive notice should not be applicable where transactions with a third party are concerned. This may be controversial since it may be too onerous on former partners if the doctrine of constructive notice is not applied. The respondents in the first round of consultation seemed to go both ways on this issue.
It may be in the public interest to only allow for actual notice and this view is supported by the approach taken by the Jersey LLP Act where it provides that for the purposes of determining whether a partner has authority to act on behalf of an LLP, no person is deemed to have notice of any records by reason only that they are made available by the Registrar for inspection.
Relationship between the LLP and Partners
The CCM is of the view that default rules should be provided in the proposed LLP Act. However, such default rules are only applicable in the absence of a partnership agreement or when certain matters are not dealt with in such agreement.
The default rules will cover areas relating to inter alia:
(i) Contribution of capital, sharing of profit and loss;
(ii) Right to indemnify;
(iii) Involvement in the management of the LLP;
(iv) Remuneration of members; and
(v) Introduction and withdrawal from membership to the LLP;
Creation of Debentures or Charges
The LLP should be allowed to create debentures or charges in order to raise loans and the CCM is in favour of this. Traditional partnerships would have to rely on the personal guarantee of the partners to secure a loan.
Creditors’ Protection Mechanism
The proposed LLP Act will contain claw-back provisions requiring contributions from partners and former partners who have withdrawn any property from the LLP within a stipulated time frame of the commencement of the winding up, if it can be shown that the LLP was insolvent at the time of withdrawal or that the partner(s) knew or have reasonable grounds for believing that the LLP was or would not be able to pay its debts.
The time frame may mirror the 6-month window under insolvency laws or a longer period may be adopted.
Such claw-back provisions should be limited to only the amount withdrawn by the partner or former partner of the LLP.
An LLP is deemed to be insolvent if at anytime the LLP is unable to pay its debts when they are due in the normal course of business or at any material time the value of the LLPs’ assets is less than the value of its liabilities. This is a clearer definition of insolvency than that contained in the Companies Act 1965 and codifies one of the common law tests for insolvency.
The circumstances of the LLP’s inability to pay debts should be made consistent with section 218(2) of the Companies Act 1965 which states that the inability of a company to pay its debts is when the company is indebted in a sum exceeding five hundred ringgit loans. This in itself may be controversial since there already is a criticism of the low 500 ringgit threshold for companies, and any amendment to the Companies Act 1965 to raise this limit should similarly be adopted under the proposed LLP Act.
Dissolution of the LLP
The partnership agreement can dictate the methods for dissolving an LLP and an LLP should not be affected by the death or bankruptcy of its partner.
An LLP can be voluntarily dissolved if its partners agree to do so. This may very well entail the filing of the necessary certificate of solvency with the Registrar or the making of a statutory declaration that the LLP is solvent before the commence of the winding up process (as is the position under the UK LLP Act).
The Court may also be empowered to order an LLP to be dissolved in certain
circumstances. The CCM is in favour of adopting the Singapore position, where some of the circumstances in which the Court can dissolve an LLP are:
(i) the partners have resolved that the LLP be wound up by the Court;
(ii) the LLP is unable to pay its debts;
(iii) the Court is of the opinion that it is not reasonable/practicable to carry on the business of the LLP in conformity with the partnership agreement;
(iv) the Court is of the opinion that it is just and equitable that the LLP be wound up; or
(v) the LLP is being used for unlawful purposes or for purposes prejudicial to public peace, welfare or good order or against national security or interests.
…the benefits enjoyed by the partners of the LLP must also be tempered with the protection of the public…
Conclusion
It is very encouraging to see the CCM pushing hard for the implementation of the LLP model. Aside from the proposed LLP Act which will adopt most of the above features, legislation like the Income Tax Act, and other statutes governing professional bodies, for instance the Legal Profession Act, will also have to be amended accordingly. It may be too much to ask to implement the entire structure by 2009 but at least that is the targeted time frame presently.
This new LLP vehicle will aid small and medium sized business as well as professionals in the running of their respective businesses. The CCM is already mindful that the benefits enjoyed by the partners of the LLP must also be tempered with the protection of the public dealing with the LLPs.
Of Barristers and Solicitors
Malaysia enjoys a fused legal profession in that there is no legal distinction between an advocate and solicitor. When one is Called to the Bar, one is admitted as an Advocate and Solicitor of the High Court of Malaya.This is in contrast to countries, for instance England and Wales, which have a split profession. One is either a barrister or a solicitor. Barristers enjoy the rights of audience to appear before the higher courts, rights which to a large extent solicitors are unable to enjoy. Solicitors may carry out the litigation through exchange of correspondences as well as the drafting of the court papers, tasks which barristers are forbidden from carrying out.
Barristers also provide specialist legal advice to solicitors, which therefore draws some comparison to the medical profession, whereby solicitors can be seen as general practitioners while barristers are specialists in advocacy or advisory services.
As explained by Epstein, the barrister-solicitor distinction dates from the 13th century, when English courts held that only advocates who had regularly come before them could argue a litigant’s case. An advocate was allowed to enter the picture only at the final argument stage, so that the litigant had to make the initial pleadings himself. Advocates were precursors to barristers.
By the 15th century, litigants were allowed to hire out-of-court attorneys to submit pleadings in writing, and these attorneys were precursors to solicitors. As the demand for legal services increased with economic development, so did the need for courtroom advocates. Inns of Court arose to train and regulate the advocates — drawn exclusively from the upper classes — as the only people authorised to appear before high-court judges. In the 16th century, the division between barristers and solicitors became fixed. Clients dealt only with solicitors, and solicitors arranged for barristers.
Epstein argues that this historical baggage provides scant reason for such a market division, and I agree with this contention. One argument in support of the continued split in the profession is that having an independent barrister reviewing a cause of action gives the client a fresh and independent opinion from an expert in the field, something that rarely happens in jurisdictions with fused professions. Another is that by having recourse to all of the specialist barristers at the Bar, it levels the playing field by enabling smaller firms, who could not maintain large specialist departments, to compete with larger firms.
One clear disadvantange of maintaining a split profession is that of possibly high legal fees. Multiplicity of legal advisers will necessarily lead to higher costs.
In England and Wales, the clear demarcation between barristers and solicitors have eroded with solicitors also enjoying rights of audience if they become qualified as solicitor-advocates. Solicitor-advocates can also enjoy the title of Queen Counsel. Further, larger solicitor firms have also started to hire barristers to act as their specialist in-house Counsel.
This post does not propose to cover in-depth the vast span of this topic, and I have not been able to flesh out the advantages or disadvantages of maintaining either a fused or split profession. I would however like to invite views though on these issues.
It is noted that in 2004, in the Review of the Regulatory Framework for Legal Services in England and Wales, dubbed the Clementi Report, Sir David Clementi did examine the present framework of the provision of legal services in England and Wales. The Report did touch on the split in the barrister and solicitor profession. While making no recommendations on converting to a fused profession (it appears that the Report did not consider such a step), there were recommendations made in creating alternative business structures which would allow solicitors and barristers to enter into partnership together, as well as entering into partnerships with non-lawyers.
This post was also brought about by this interesting article on a QC who had requalified as a solicitor to head the advocacy unit of Herbert Smith.
Of Counsel 