Page 1

MY NEXT MOVE

IN-DEPTH

APPOINTMENTS

PRACTICE PROFILE

Tips for finding where you fit in

Clifford Chance and DLA’s plans for local domination

Peter Deegan’s new life outside the Magic Circle

Finetuning national workplace safety laws

THE FIRM

GLOBAL TOUCHDOWN

ADVENT’S TALENT COUP

NOT SO HARMONIOUS

www.lawyersweekly.com.au

533

Friday 13 May 2011 Print Post Approved 255003/05160

Why it’s time to start the conversation

OUTSOURCING Plus The merits of an LPO career


Dolman Worldwide Legal Recruitment welcomes Olivia Harvey Olivia Harvey joins the Dolman in house team fresh from London. She is a New Zealand qualified lawyer who spent the first three years of her career working as a commercial litigator for Simpson Grierson in Auckland before moving to London to work as a risk and compliance lawyer for Freshfields Bruckhaus Deringer. Having worked in both private practice and in house Olivia offers clients and candidates a unique insight into the technical and cultural cross over between the two legal markets.

In-house

Sydney | Property

Sydney | Commercial / FS

Perth | Resources

This leading international infrastructure company is seeking a dynamic property lawyer for its expanding team. You will be working closely with a key business unit on a broad range of property and commercial matters. Extensive property experience gained in a major firm or in-house role as well as strong commercial appreciation is required. Great work-life balance! Ref: SYD/4227/DS

Leading listed financial services company has a new, varied role for an outgoing and commercial junior lawyer to join their team. Wide range of work available including retail finance, commercial contracts, marketing/TPA etc. Experience in one or more of these areas gained at a major firm is required. Rare opportunity for a junior lawyer to move into a major corporation! Ref: SYD/4234/DS

Leading ASX listed resources company has a new requirement for an accomplished senior lawyer to lead their legal team. As a key member of the senior management team you will be responsible for handling the high-level corporate legal work (M&A, corporate advisory, co sec) while managing a team. Excellent package available and the opportunity to play an important role in the growth of the company. Ref: PER/4208/DS

Hong Kong | Corporate M&A

Hong Kong | Banking & Finance

Singapore | M & A / PE

International law firm is searching for a Commonwealth qualified M&A specialist for a high profile role involving mergers & acquisitions, joint ventures and advisory work. Experience gained from a top tier or respected international mid tier law firm together with solid academics are necessary. Chinese speaking ability will be highly regarded but is not necessary for this role. Ref: HK/4233/RL

Our client is looking for a high caliber, energetic banking and finance lawyer with a broad range of experience gained from a top tier or highly regarded mid tier practice to join it’s leading Asian finance team. You will need strong academic, inter-personal and technical skills to qualify for this role. Chinese language ability NOT required. Ref: HK/4235/RL

Junior partner or senior associate who has partnership aspirations and M&A and Private Equity experience is needed by an international law firm to advise investment banks and blue chip corporates in Asia on complex cross border acquisitions, disposals and joint ventures . Strong technical skills are essential to manage intellectually challenging deals. Ability to travel is also necessary. Ref: SIN/4167/RL

Melbourne | Property

Sydney | Banking and Finance

Sydney | Financial Services

Excellent opportunity for an experienced property lawyer to join this international firm. Work with two first rate partners across a range of commercial property matters including various land transactions, large scale developments complex leasing work and property trusts. You will enjoy a high level of autonomy and client exposure and be given the opportunity to mentor more junior lawyers in the team. Clear pathway for progression and competitive remuneration package on offer. Ref: MEL/4159/RL

This highly regarded top-tier law firm is seeking a talented banking and finance lawyer. The Banking & Finance practice is known as one of the most preeminent practices in the Australian market; acting for domestic and international banks, and a diverse range of major financial institutions. They are seeking a lawyer with a minimum of two years experience to work on a range of banking & finance areas including acquisition/leveraged finance, project/infrastructure finance, and corporate financing. Ref: SYD/4054/RL

Exciting opportunity with this national mid-tier firm for a dynamic financial services lawyer. You will be involved in a range of work including the creation of financial products, preparation of disclosure documents, advising on capital raising, equity and fundraising, compliance, funding and venture capital raisings. Your drafting and analytical abilities will be second to none and you will possess the skills to develop strong client relationships. Ref: SYD/4230/GG

Melbourne | Insurance

Sydney | M&A / ECM

Excellent opportunity for an experienced insurance lawyer to join this national mid tier firm. The firm has an excellent reputation and is know for their quality service offering. They are seeking a lawyer with at least 2 years experience to work across a range of professional indemnity, medical negligence, public and product liability with first class Partners in a down to earth team. Strong academic background and interpersonal skills are essential. Ref: MEL/4146/RL

Our client’s enviable corporate group includes a capital markets practice comprised of some of the most reputable partners in Australia. The group advises on capital raisings, IPOs and strategic placements domestically and internationally. The M&A team works on both public and private transactions advising both corporate clients and investment banks. This key leadership role will challenge you to manage the firm’s client relationships and legal project teams. Ref: SYD/4178/RL

Sydney | Corporate Financial Services

Sydney | Corporate / M&A

Brisbane | Employment

This well respected mid-tier firm has an opening for a savvy corporate lawyer with a solid background working on a range of corporate work with an emphasis on mergers and acquisitions. Blue chip client base and supportive and friendly team environment. You will have very strong drafting skills, be technically sound and be client focussed with a commercial approach. The ability to supervise and provide support and assistance to junior lawyers is also essential. Ref: SYD/4141/GG

Our client is a premier national law firm with a new opportunity for a savvy workplace relations lawyer to join their award winning team. You will advise high calibre clients in the resources, manufacturing and infrastructure sectors on a broad range of employment and industrial relations matters. Previous experience with a renown or mid-tier practice in this area is essential. Great relaxed culture with a competitive salary and excellent benefits on offer. Ref: BRI/4212/GG

3 years +

International 4 years +

1 – 3 years

4 years +

General Counsel - 8 years PAE

Senior Associate or Junior Partner

Private Practice 3 years – Senior Associate

2 years +

Senior Associate

Excellent opportunity to work with highly regarded partners in the areas of corporate, funds and financial services. You will be involved in corporate transactions, product structuring, ASX listings, fundraisings, the investment and divestment process and establishing offshore products. You will be acting for blue chip clients including major household names in the financial services industry. Excellent career prospects and competitive remuneration package on offer. Ref: SYD/4213/RL

2 – 4 years

Senior Associate

4 years +

For a full list of active roles that Dolman is working on throughout Australia and worldwide visit www.dolman.com.au For further information, please contact one of our consultants: Olivia Harvey, Ralph Laughton, Daniel Stirling and Gail Greener. Sydney (02) 9231 3022 Melbourne (03) 8637 7317 or email dolman@dolman.com.au

3 – 5 years

Brisbane | Property / Projects 5 years +

Very successful and growing national law firm has a new opportunity for a Senior Associate. You will be exposed to development work, sales and acquisitions, leasing, community titles and project work for a range of clients. You will work on complex development matters so you must be able to hit the ground running in this respect. Above market remuneration on offer together with excellent staff benefits. Ref: BRIS/3904/GG

3 – 4 years


Contents

“I thought, ‘I can do a raid on a firm, but I will get the same result as A&O, with a mix of some people that are good, bad and indifferent’” Peter Charlton, Clifford Chance Asia managing partner, on the firm’s merger strategy.

Regulars

Features

6 THIS WEEK: A round-up of the latest legal news

10 IN-DEPTH: Australia’s newest foreign arrivals share the same lofty ambitions. But, as Justin Whealing discovers, their plans for local domination are worlds apart

12 RISK UPDATE: Australian companies that run a business in the UK will be subject to new anti-bribery laws that extend beyond financial reward to entertainment, privileges and gifts

14 PRACTICE PROFILE: The national harmonised OHS laws are due to start on 1 January 2012. Will they be effective in reducing red tape and making the workplace safer? Justin Whealing reports

22 20 CAREER COUNSEL: Working in a legal process outsourcing centre can offer valuable experience and benefits such as work/life balance

22 FOLKLAW: The lighter side of the law

16 COVER STORY: Growing international pressure has led some of Australia’s largest law firms to take their first tentative steps towards outsourcing legal services – though few are willing to admit it. Angela Priestley reveals why LPO can no longer be ignored

L AW Y E R S W E E K LY 13 M AY 2 0 11

3


Editor’sNote IT WASN’T all that long ago that the concept of legal process outsourcing (LPO) was difficult to imagine. Sure, some law firms may have forayed into business process outsourcing – seeing some basic administrative duties moving offshore – but the thought of legal process outsourcing simply seemed like a distant, wacky and somewhat concerning future. That future is here. While it’s taken some time for Australian law firms to jump on board, the use of LPO internationally, by some of the globe’s largest law firms, has well and truly become par for the course of what’s considered good legal practice. Now, it’s finally Australia’s turn. At least that’s what one is led to believe off the back of some LPO providers, both onshore and off, who claim that a good portion of Australia’s largest law firms are currently undertaking due diligence with them on the benefits and risks of LPO (see cover story on page 16). But it seems that despite the high-profile LPO relationships being spruiked overseas, such as that between Eversheds and CPA Global for shifting work to India, our local law firms are not yet willing to make too much of a splash about their interest, or indeed their LPO relationships, just yet. There are some exceptions. Recently, Blake Dawson announced a three-way partnership between long-term client Rio Tinto and LPO provider CPA Global. And Advent Legal is currently offering a three-way partnership direct to clients via LPO provider Pangea3. For the most part, though, Australian law firms aren’t ready to play the LPO marketing game. Frankly, the Australian legal services market is ignoring the elephant in the room. We can pretend it’s not happening and that clients are not tempted by its cost-saving potential, but the reality is that LPO is changing the shape of global legal service – and it’s likely to continue to wreak havoc on the sector for years to come. Behind closed doors, many firms are no doubt having the LPO discussion with clients. Overseas, it’s clients that have predominantly driven the push towards LPO, with the law firms that have answered the LPO call ultimately being successful in winning the related client work. Australian law firms may benefit from sitting back and allowing their counterparts in the UK and the US to experiment, on a large scale, with LPO providers. Australian firms would be wise to take those lessons on board and realise LPO’s cost-saving potential.

Editor, Angela Priestley

ON THE WEB

TOP 10 STORIES ONLINE THIS WEEK

NEXT WEEK

There was an air of excitement in the capital as federal budget fever descended on the ACT this week. Did you miss out? Catch up online via Lawyers Weekly’s comprehensive coverage of the Treasurer’s fourth budget. See www. lawyersweekly.com.au for all the legal-related news and the LexisNexis special budget portal (www.lexisnexis.com. au/federal-budget) for wider industry information, commentary and updates.

1

The shortage of lawyers in rural, regional and remote areas has long been a dilemma for the Australian legal sector. So how are the lawyers in these areas faring, and what are their major concerns? In the next edition, Lawyers Weekly investigates the progress being made on solutions to the problem.

4

L AW Y E R S W E E K LY 13 M AY 2 0 11

2 3 4 5 6 7 8 9 10

Clifford Chance opens with swipe at A&O Irish lawyer quits mid-court Man who killed lawyer wins on appeal Replacement heads for ACCC and ASIC announced Firms still lack action on depression A-G launches new book for Clayton Utz DLA Piper not striking big M&A tune in Australia Red faces for poor billers Blakes and Clutz aid $1.4bn deal Life outside the law for a triathlete

EDITORIAL BOARD Lawyers Weekly is delighted to have the following industry leaders on its editorial board Andrew Grech Managing director, Slater & Gordon

Nick Abrahams Partner and Sydney chairman, Norton Rose

Will Irving Group general counsel, Telstra Corporation

Helen McKenzie Deputy managing partner, Blake Dawson

Sharon Cook Managing partner, Henry Davis York

Joe Catanzariti Partner, Clayton Utz

David Cowling Partner, Clayton Utz

Robert Milliner Chief executive partner, Mallesons Stephen Jaques

Ewen Crouch Chairman of partners, Allens Arthur Robinson

Megan Pitt Director, Australian Government Solicitor

Sue Gilchrist Partner and practice leader (intellectual property group), Freehills

Lucinda Smith Partner, Thomson Lawyers

ABOUT US Editor: Angela Priestley Deputy Editor: Justin Whealing Contributors: Claire Chaffey, Briana Everett, Sarah O’Carroll, Ben Nice Design Manager: Anthony Vandenberg Production Editor: Vanessa Fazzino Group Production Manager: Kirsten Wissel Group Sales Manager Adrian Fellowes SUBSCRIBE TODAY Lawyers Weekly is published weekly and is available by subscription. Please email subscriptions@lawyersweekly.com.au All subscription payments should be sent to: Locked Bag 2333, Chatswood D/C, Chatswood NSW 2067 ADVERTISING ENQUIRIES: Adrian Fellowes adrian.fellowes@lexisnexis.com.au (02) 9422 2134 (mob) 0407 489 060 Vic, SA, WA: Stephen Richards (02) 9422 2891 EDITORIAL ENQUIRIES: Angela Priestley angela.priestley@lexisnexis.com.au (02) 9422 2875 All mail for the editorial department should be sent to: Lawyers Weekly, Level 1 Tower 2, 475 Victoria Ave, Chatswood NSW 2067

CAB MEMBER SINCE SEPTEMBER 2000 Copyright is reserved throughout. No part of this publication may be reproduced without the express written permission of the publisher. Contributions are invited, but copies of all work should be kept, as Lawyers Weekly can accept no responsibility for loss. Lawyers Weekly and LexisNexis are divisions of Reed International Books Australia Pty Limited, ACN 001 002 357 Level 1 Tower 2, 475 Victoria Ave, Chatswood NSW 2067 tel (02) 9422 2203 fax (02) 9422 2946 ISSN 1833-5209 Important Privacy Notice: You have both a right of access to the personal information we hold about you and to ask us to correct if it is inaccurate or out of date. Please direct any queries to: The Privacy Officer, LexisNexis Australia or email privacy@lexisnexis.com.au. © 2010 Reed International Books Australia Pty Ltd (ABN 70 001 002 357) trading as LexisNexis. LexisNexis and the Knowledge Burst logo are registered trademarks of Reed Elsevier Properties Inc., and used under licence.

w w w.law yersweekly.com.au


thisweek

Arbitration history documented Judicial and arbitration figures attended the launch of the definitive tome of commercial arbitration laws in Australia on 4 May. Commercial Arbitration in Australia, by senior Clayton Utz partner Doug Jones, deals with the development of commercial arbitration over the past two decades. In particular, it focuses on the decision to adopt the United Nations Commission on International Trade Law model to govern Australia’s domestic commercial arbitration system. Bakers delights in Doha digs Baker & McKenzie has expanded its international operations by opening an office in Doha, Qatar. Koen Vanhaerents, Bakers’ European chairman, said the move will enable the firm to provide on-the-ground support to existing clients the firm is servicing in Qatar. Bakers now has 69 offices in 41 countries, with Qatar adding to practices in Riyadh, Cairo, Bahrain and Abu Dhabi. Oz GC up for world gong Woolworths general counsel Peter Horton has been nominated for the World General Counsel of the Year award at the Global Counsel Awards 2011. The awards, managed by the International Law Office with the support of the Association of Corporate Counsel and based on in-depth analysis of in-house lawyers and departments across the globe, will be announced on 16 June in New York.

6

l aw y e r s w e e k ly 13 M ay 2 0 11

The Web

Man who killed lawyer wins appeal A man who murdered his lawyer because he believed the lawyer failed to properly represent him in a legal matter has had his 28-year prison sentence reduced by four years. In 2006, Sydney man John Thomas Glascott fatally shot David Robinson, who had acted for Glascott in a family and property dispute, after Robinson caught him trying to set fire to his office building. He was convicted of murder in 2008.

Pakistani lawyers mourn bin Laden MORE THAN 100 Pakistani lawyers have held a memorial service for Osama bin Laden. The website Allvoices.com reported that on Wednesday last week, the Islamic lawyer forum group held the service in front of the High Court in Peshawar in the Khyber Pass region of Pakistan. The service, conducted in the early afternoon, attracted a strong police presence. On the same day as the Peshawar service, around 70 lawyers staged a protest against the killing of the al-Qaeda leader 150 kilometres to the east in Abbottabad. The lawyers chanted slogans such as “Go, America go” and “Osama bin Laden is our hero”, reported Allvoices.com. The extra-judicial killing of bin Laden has polarised the global legal community. US Attorney-General Eric Holder told a Senate Judiciary Committee during the week that the killing was lawful and an act of national self-defence. “Bin Laden was the head of al-Qaeda, an organisation that had conducted the attacks of September 11th,” he told the commission. “It’s lawful to target an enemy commander in the field.” Australian human rights lawyer Geoffrey Robertson QC has called the killing “a perversion of justice”, saying that bin Laden should have been captured and brought to trial. “This man has been subject to summary execution, and what is now appearing after a good deal of disinformation from the White House is it

may well have been a cold-blooded assassination,” he told the ABC. In addition to the legal and moral arguments about whether bin Laden’s killing was justified, a legal challenge has erupted over whether photos of a dead bin Laden should be made public. US President Barack Obama has refused to publish the photos at this stage, maintaining that they are “gruesome” and could be used for propaganda purposes against the United States. Associated Press has lodged a request under Freedom of Information laws to see the photos. The US government has 20 days to formally respond to the request.

R E W IND Australia’s big banks posted record half-year profits totalling $12 billion – $2.7 billion of which belong to National Australia Bank. Fair Work Australia gave the green light to a case study on low-paid workers and those deemed to have low bargaining power, saying that it is in the public interest for such a study to be conducted. Professional industry bodies slammed state and federal governments for failing to adequately deal with the skills shortage, which they believe is likely to worsen. The traditional owners of the land on which Woodside’s $30 billion gas project is set to commence have launched a legal challenge stating that the compulsory acquisition of land is illegal. The United Nations warned that economic recovery in the Asia-Pacific region is under threat from rising food and oil prices and the possibility that property bubbles will burst.

w w w.law yersweekly.com.au


thisweek

Movers & Shakers

D E A L O F T HE W E E K

Freehills and Bakers act on Thai energy deal Deal name: Proposed acquisition by Ratchaburi Electricity Generating Holding PCL of percentage of TSI Fund securities Key players: Freehills, Baker & McKenzie

FREEHILLS HAS announced it is advising the independent directors of Transfield Services Infrastructure Fund (TSI Fund) on the proposed acquisition by Ratchaburi Electricity Generating Holding PCL (RATCH) of the 56.2 per cent of TSI Fund securities that Transfield Services Ltd (TSE) does not hold. The scheme implementation agreement, which was signed on 2 May, contemplates that the acquisition will take place via inter-conditional schemes of arrangement and an associated trust scheme. RATCH, advised by Baker & McKenzie, and TSE have entered into a transaction framework agreement under which they have agreed to a number of transactions that are conditional on the implementation of the schemes, including RATCH acquiring a further 23.8 per cent of TSI Fund from TSE. TSI Fund is a triple-stapled ASX-listed

entity that owns a portfolio of interests in essential infrastructure assets, while RATCH is Thailand’s leading power producer, listed on the Stock Exchange of Thailand. The proposed cash offer implies an enterprise value for TSI Fund of $813 million. The Freehills team is led by Philippa Stone and includes partner Tony Sparks, senior associate Robert Feiner and lawyers Ivan Yu, Ashley Rose and Calvin Kwok. “We are delighted to have assisted TSI Fund in securing what the independent directors, after having evaluated a range of alternatives, consider to be the best overall outcome for its security holders,” said Stone. “It has been a pleasure to continue our long-standing relationship with TSI Fund, having initially acted on its IPO and more recently on its capital structure review in 2010.”

DE AL MAKERS

Phil Lucas

Nathaniel Popelianski

Barry McWilliams

Firm

Allion Legal

Corrs Chambers Westgarth (Australand), Minter Ellison (CBA)

Mallesons Stephen Jaques (Valad), Gilbert + Tobin (Blackstone)

Deal name

Bathurst Resources Ltd on acquisition of NZ Brookdale Coal Project

Australand Property Group on commercial leasing of 357 Collins St, Melbourne, to CBA

Proposed acquisition of Valad Property Group by US private equity group Blackstone

Area

Energy and resources

Property

M&A

Value

$25.7 million

Undisclosed

Undisclosed

Key players

Allion’s Phil Lucas

Corrs’ Nathaniel Popelianski

Mallesons’ Barry McWilliams and Ken Astridge

M+K takes from Herbert Geer Queensland’s Macpherson+ Kelley has appointed former Herbert Geer senior associate Craig Roelofsz a principal in the corporate and commercial group. Roelofsz has primarily advised clients in the energy and resources, agribusiness, property and commercial cleaning industries. He is president of the Queensland Chapter of the Australian Africa Business Council. Finlaysons gets new CEO Adelaide-based Finlaysons has appointed Gerry Mak chief executive officer. Mak has 25 years of experience in senior executive management roles, including time as the general manager of the Melbourne fire brigade, CEO of the Royal Australian College of General Practitioners and various law firm management positions. Most recently he was CEO of SA Heart, a group of private cardiologists. Advent scores CC partner Former Clifford Chance partner Peter Deegan has joined Advent Lawyers, whose model provides senior-level lawyers direct to clients to work on projects, transactions and assignments. Deegan is a corporate and finance lawyer with experience in senior executive teams around the world advising on M&A, finance and restructuring transactions. Maddocks picks up govt specialist Government lawyer Mark Sheridan has joined Maddocks as a senior associate in the property team. Sheridan has acted for government and corporate clients on commercial property transactions and most recently held the position of senior executive lawyer and Sydney team leader with Australian Government Solicitor.

L AW Y E R S W E E K LY 13 M AY 2 0 11

7


thisweek xilsac appointmentsx

New talent to drive growing legal export sector

xahrc reportx

Support for broadening sex discrimination laws FEDERAL LAWS protecting people from discrimination on the grounds of sexual orientation, sex and/or gender identity would have wide support in Australia, the Australian Human Rights Commission (AHRC) has found. Releasing the 2011 Addressing sexual orientation and sex and/or gender identity discrimination consultation report last week, AHRC president Catherine Branson QC said the consultation undertaken last year had heard compelling evidence of the need for such laws. “The commission’s consultation revealed numerous and distressing stories of how people’s lives had been impacted and damaged by discrimination, violence or bullying on the basis of their sexual orientation and sex and/or gender identity,” said Branson. “We also heard lots of different views on how human rights protections for this group of people could be strengthened, but by far the most frequently suggested solution was the inclusion of protections in federal laws.” Branson said this would give people discriminated against on this basis access to legal remedies, and would also deliver broader positive social implications. “Providing federal protections against this type of discrimination would be a significant symbolic gesture which would help to bring about attitudinal change and ultimately improve the day-to-day lives of many people...” she said. “Having federal laws which protect people from this type of discrimination, violence, harassment and bullying could particularly help to build self-esteem and resilience in young people.” Marriage equality was also proposed by consultation participants as an important step towards full equality for lesbian, gay, bisexual, trans and intersex people. “Importantly, in 2010 both of the major political parties affirmed their support for the inclusion of protection from discrimination on the basis of sexual orientation and gender identity in federal law,” said Branson. The AHRC undertook public roundtable discussions in Sydney and Melbourne and received comment from more than 150 individuals and organisations.

8

l aw y e r s w e e k ly 13 M ay 2 0 11

AUSTRALIA’S $709 MILLION-a-year legal export market will continue to grow via an injection of fresh expertise and experience into the International Legal Services Advisory Council (ILSAC). That’s the opinion of Attorney-General Robert McClelland, who announced the council’s new members line-up on 4 May. The new appointments include representatives from eight of the largest law firms in Australia, as well as government department representatives, academics, former Law Council of Australia president Glenn Ferguson and the head of global private equity at MLC, David Krasnostein. Tim Bugg, a director at Dobson Mitchell & Allport, will chair the panel.

“Recent figures released by the ILSAC reveal total exports of Australian legal and related services of $709 million for 200809. These are impressive figures, and there are opportunities for further growth in our immediate region and beyond,” said Mr McClelland. The new council will also undertake a joint study with the AttorneyGeneral’s Department to identify key legal services markets that Australia should focus on.

InternatIonal legal ServICeS advISory CounCIl Chairman 1. Tim Bugg, director, Dobson Mitchell & Allport, Hobart Commercial practitioners 2. Stuart Clark, chief operating officer and managing partner international, Clayton Utz, Sydney 3. John Denton, chief executive officer, Corrs Chambers Westgarth, Melbourne 4. Glenn Ferguson, managing partner, Ferguson Cannon, Maroochydore 5. Gordon Hughes, partner, Blake Dawson, Melbourne 6. David Krasnostein, head of global private equity, MLC, Sydney 7. Tim Lester, partner, Allens Arthur Robinson, Perth International legal education and training 14. Prof Duncan Bentley, pro vice-chancellor, Curtin Business School, Curtin University of Technology, Perth 15. Prof Michael Coper, dean of law, Australian National University, Canberra 16. Prof Jill McKeough, chair of the Council of Australian Law Deans and dean of law, University of Technology, Sydney

8. Bronwyn Lincoln, partner, Freehills, Melbourne 9. Fiona McLeod SC, barrister, Melbourne 10. Russell Miller AM, partner and chairman, Minter Ellison, Canberra 11. Robert Milliner, chief executive officer, Mallesons Stephen Jaques, Sydney 12. Mary Padbury, chairman, Blake Dawson, Melbourne 13. Kerry Ryan, consultant, Norton Rose, Melbourne

department/agency representatives 17. Attorney-General’s Department 18. Department of Foreign Affairs and Trade 19. Department of Education, Employment and Workplace Relations 20. Austrade 21. AusAID

w w w.law yersweekly.com.au


thisweek xobituaryx

Peter Scammell offered ‘wise counsel’ in a career spanning five decades

TO THOSE who knew him – and many in the Australian legal community did – Peter Scammell was a trusted colleague. With a career spanning more than five decades, Scammell was a noted member of Sydney’s best private practice lawyers. After graduating with an arts/law degree from the University of Sydney in 1957, Scammell commenced his career with Dawson Waldron Edwards & Nicholls (now Blake Dawson). He joined NJ Bell and Cadigan (now Middletons) as a solicitor in 1960 and in the same year was elevated to the firm’s partnership ranks. Nine years later, Scammell joined Henry Davis York and was appointed to the partner-

hip. He remained there for 32 years until his retirement on 30 June 2001. His career crossed numerous transactions and areas of corporate law, but most notable was his work with the Hooker Corporation. Scammell carried out all of the organisation’s commercial work, including advising the board on the proposed merger with Tooth & Co. His involvement in the legal profession extended well beyond his retirement. Having been appointed by the Chief Justice of the Supreme Court of NSW as a cost assessor in 1996, Scammell continued with this work after leaving private practice and became one of the most senior and well respected cost assessors in the state. HDY reports that Scammell frequently sat as an assessor on appeal and regularly consulted to the court on law reform in the area. “His wise counsel, and his common sense approach to solving problems, will be missed by those at the court,” said an HDY spokesperson in a statement released last week. HDY also noted that Scammell made a significant contribution to the firm as a finance partner and a member of the firm’s board management from September 1986 to December 1996. Scammell’s funeral was held last Friday in Sydney. He died on 29 April, aged 74.

xamendments to actx

Equal opportunity laws ‘watered down’ THE LAW Institute of Victoria (LIV) has expressed disappointment at the amendments to the Equal Opportunity Act 2010 introduced by the Victorian Government. LIV president Caroline Counsel said the Government had “watered down” the Act without consulting the Victorian community. “The Government has muzzled the powers of our Equal Opportunity Commissioner to investigate serious systemic workplace discrimination, as well as endorsing employment discrimination in religious schools,” said Counsel. “This is a backward step for equal opportunity and fair employment practices.”

Under proposals introduced by the previous government, the Victorian Equal Opportunity and Human Rights Commissioner would have had the power to address serious discrimination affecting organisations as a whole, and not just individuals. In a submission last year, the LIV supported the “inherent requirements test” that would have forced religious organisations, including schools, to show that employment discrimination was necessary for fulfilling job requirements. This has been removed from the Bill. “We believe it is important to balance the right to freedom of religious belief with the right to equality,” said Counsel.

US/UK Update

sydney farewells a trusted adviser

slump continues for Uk firms The United Kingdom’s top legal firms are anticipating yet another year of poor financials, reports The Lawyer. A third successive year of minimal growth is expected due to the fact that the UK economy has failed to recover in the way anticipated 12 months ago. None of the top10 firms predict revenues to improve by more than five per cent this financial year. New head for linklaters Linklaters has chosen its global banking chief, Robert Elliott, as its new senior partner, reports Legal Week. Elliott’s election settles the firm’s long-running contest for the top role and sees him take the post from incumbent senior partner David Cheyne. Elliott beat head of litigation John Turnbull and European managing partner Jean-Pierre Blumberg to the top job, and will serve a five-year term. HFw reports revenue increase UK firm Holman Fenwick & Willan has become the first top-50 firm to reveal its financial results, reports Legal Week. The firm posted revenues of £112.5 million ($171 million) for the financial year ending 31 March. This equates to a 12.6 per cent increase compared with the £99.9 million figure reported last year. Uk firms tackle social issues The British legal sector is beginning to confront the issue of social mobility, reports The Lawyer. Last month, several Magic Circle senior partners convened a summit to explore ways their firms could assist candidates from disadvantaged backgrounds. Deborah Dalgleish, head of diversity and inclusion at Freshfields Bruckhaus Deringer, acknowledged that social mobility is a significant problem for law firms. Bakers launches in Qatar Global firm Baker & McKenzie will open its fifth office in the Middle East and North Africa, confirming its intention to launch in Qatar, reports Legal Week. Gulf managing partner Borys Dackiw, currently based in Abu Dhabi, will start out as head of the new office in Doha, which will provide full-service advice to domestic and international clients. The practice will use lawyers from Bakers’ 40-strong Middle East team.

l aw y e r s w e e k ly 13 M ay 2 0 11

9


indepth

Double vision Australia’s newest foreign arrivals share the same lofty ambitions. But, as Justin Whealing discovers, their plans for local domination are worlds apart

C

lifford Chance and DLA Piper both marked their official entry into the Australian legal market with similarly lavish launch parties, but their business strategies are vastly different. While it is rare to compare a law firm with a supermodel, in Australia Clifford Chance is taking a similar view as Linda Evangelista, who once said that she wouldn’t wake up in the morning “for less than $10,000 a day”. The English firm is deliberately targeting only the big-ticket items in Australia, looking to act on lucrative M&A and banking and finance work, as well as high-end litigation matters. At its launch party in Sydney on 3 May, Asia managing partner Peter Charlton told Lawyers Weekly that the firm would pursue a strategy that fits in with its global model. “I came to Asia and I thought, ‘I like M&A and high-end litigation’, and the most active M&A market in Asia is Australia,” says Charlton. “The things that make sense at Clifford Chance

10

L AW Y E R S W E E K LY 13 M AY 2 0 11

and stick with our global strategy are fund formation, high-end finance and in particular, cross-border work. “We are global leaders in financial regulation and the whole regulatory environment around the world is changing. Why shouldn’t Australia have a piece of that and pay for it?” There are certainly great opportunities for law firms to cash in on Australia’s rebounding M&A market. According to Thomson Reuters, M&A activity for the first quarter of 2011 totalled $US39.9 billion ($37.7 billion), the highest first-quarter volume since the boom times of 2007. Much of this growth is being driven by Asian companies investing in Australia. Now, high-end legal advisers such as Clifford Chance are following the money. “Australia changed, and suddenly it is interesting, not because it is full of lawyers or full of well-trained people to fuel our growth. It’s because it is interesting to our clients,” says Charlton. “And where are our clients? They are in China, Japan, India, Korea – and they are all investing in Australia.” Clifford Chance Sydney managing partner Mark Pistilli says that while it might be “a risk” to target high-end corporate work and refer add-ons – such as employment law or occupational health and safety matters – to other firms, he is confident the model will work. “The reality is that as a small boutique firm, and CLCL [Cochrane Lishman Carson Luscombe] is the same, we have been operating in the market for five years and have been quite comfortable to draw in experts from other firms,” says Pistilli. “The way this model works is to be friendly with other law firms. So we abide by our ethical standards to refer pieces of work out and we often call on the expertise of others when there is a piece of the transaction missing.”

Learning from rivals Clifford Chance generates around $200 million in revenues through its existing Asian offices in Bangkok, Beijing, Shanghai, Hong Kong, Singapore and Tokyo. After a strategic review in 2010, the firm decided the best way to enter the Australian market was via a merger

“You can’t be a meaningful part of what goes on in the world without having a meaningful position in the Asia-Pacific region”

with established corporate boutique firms, after years of negotiations with Mallesons Stephen Jaques had broken down. “We were looking abroad, on the back of a boom, and around one-third of our growth was with Australian lawyers, so what was interesting to us at this time in Australia was the people,” says Charlton. The merger route with Mallesons was eventually scuppered by the global financial

w w w.law yersweekly.com.au


indepth

“Long Small quote” XXXXXXXXX

work if you are lucky, but nine times out of 10, you are unlucky.” By merging with Chang, Pistilli & Simmons (CPS) in Sydney and Cochrane Lishman Carson Luscombe in Perth, the firm had offices ready to go and 14 partners on both sides of the country that practised in areas that suited the Clifford Chance model. “I took two trips to Sydney to speak to people and even though the first meeting with CPS wasn’t great, and I wasn’t sure, I got to know them very well and they grew on me and I thought, ‘This will work’. They told me the firm to talk to in Perth was CLCL. “A couple of other partners from Clifford Chance met with Michael Blakiston and key partners at major Australian firms, and they said the people who impressed them most were Michael Lishman and Ian Cochrane. So I went down and chatted to them and was also quite impressed. “I like CPS being young and elbowy because it suits the Sydney market, and I like the fact that CLCL is establishment and very well connected.”

“We are global leaders in financial regulation... Why shouldn’t Australia have a piece of that and pay for it?” PETER CHARLTON, ASIA MANAGING PARTNER, CLIFFORD CHANCE

Seamless transition

crisis, and when Charlton took on his role as the head of Asia in late 2009, the Asia-Pacific was becoming increasingly influential in the global economy and numerous international legal firms were batting their eyelids at domestic Australian firms Clifford Chance watched how Norton Rose and, in particular, Allen & Overy had entered the Australian market, learning from their experience. In the end, Charlton settled on the merger model because of the ability to harness existing cultures and expertise within a small firm. “I thought, ‘I can do a raid on a firm, but I will get the same result as A&O, with a mix of some people that are good, bad and indifferent’,” he says. “Then I thought, ‘I will cherry-pick three from here, three from there, one or two from here and there’, and found it would be very, very, hard. “You would have different cultures and people that don’t know each other. It might

Compared with Clifford Chance, the arrival of DLA Piper has been decidedly low-key. DLA Piper formally entered the Australian market via its integration with five-year alliance partner DLA Phillips Fox, giving both sides a good chance to get to know each other. In Australia, the firm starts with a much larger head-count than Clifford Chance, with more than 470 lawyers spread across five offices. Like Clifford Chance, DLA Piper will be utilising the existing strengths of its already fully functioning Australian practice, such as insurance and the firm’s high-level government clients, and it will not be targeting high-end corporate work. “Our vision is to be a full-service business law firm. We are not there just for the big-ticket, one-off M&A deals,” says DLA Piper Australia managing partner Tony Holland, adding that his firm’s model in Australia is “driven by if they have an IT issue, or a real estate issue or an employment issue, we can be there for all of their needs, not just one particular aspect”. While it might not have the blue-chip connections of its English rival, DLA Piper has size and presence in the global legal market. With more than 4000 lawyers throughout 30 countries, DLA Piper, says Holland, is now the world’s largest global law firm, and with the addition of the Australian practice to its existing six Asia-Pacific offices, revenues are expected to exceed $350 million across the region. Arguably, the importance of the firm’s

“We are not there just for the big-ticket, one-off M&A deals” TONY HOLLAND, MANAGING PARTNER, DLA PIPER AUSTRALIA

Australian operations to its Asian strategy becomes more pronounced compared with its rival. Almost two-thirds of its lawyers in the Asia-Pacific will be located in Australia, while Clifford Chance has more lawyers on the ground in nearby jurisdictions such as China. “You can’t be a meaningful part of what goes on in the world without having a meaningful position in the Asia-Pacific region,” says DLA Piper’s US managing partner, Terry O’Malley. Unlike Clifford Chance, which changed suitors and reacted to the actions of competitors when entering the Australian legal market, DLA Piper’s long and old-fashioned courtship with DLA Phillips Fox before it sealed the deal meant that the firm could work to a concrete timetable regardless of market permutations “Genuinely, that had no impact at all,” says DLA Piper Europe managing director Andrew Darwin. “We had a timetable mapped out and we stuck to our timetable. What everyone else did was a bit of a coincidence.” LW

L AW Y E R S W E E K LY 13 M AY 2 0 11

11


riskupdate

Corruption net widens Australian companies that run a business in the UK will be subject to a new anti-bribery regime that extends beyond financial reward to include inducements such as entertainment, privileges and gifts

T

he UK Bribery Act 2010, which commences on 1 July 2011, casts a wider net in that it reverses the burden of proof, so someone can be successfully charged with bribery even if they had no idea of the activity. Under the new law, it will be a criminal offence to give, promise or offer a bribe and to request, agree to receive or accept a bribe – either in the UK or abroad. The law also covers bribery of a foreign public official. Under the Act, bribery is constituted as any action that might “improperly influence” someone in order to obtain business or an advantage in the conduct of business, and extends to foreign employees, subsidiaries or agents in other countries who make “facilitation payments” without company permission. The new law will apply to all UK-registered companies, as well as companies registered anywhere else in the world but that do business in the UK, according to Will Kenyon, a Londonbased partner in the forensic services group of PricewaterhouseCoopers. “One of the key tricky issues for everybody trying to interpret the Act is what is a bribe and where do you draw the line? Discussions have focused on what is an appropriate level of corporate hospitality, promotional expenditure or gifts and entertainment,” says Kenyon. There has also been debate around the level of due diligence that might be required to ensure adequate anti-bribery procedures are in place for third parties, he says. “So if you have sales agents or other intermediaries who are either out there selling for you, or helping you to interact with government or other third parties in any way, shape or form, those third parties can create vicarious liability for your organisation if they pay bribes in effect on your behalf.” Companies that come under the Act will need to improve their communication and training policies, and monitoring and control procedures, to ensure employees understand what is expected of them and where to turn for more information when needed, says Kenyon. “For large multinationals there is potentially quite a lot to do, and my concern is that some

12

l aw y e r s w e e k ly 13 M ay 2 0 11

“The higher the profile, the more likely you are to be in the crosshairs” Ian McDougaLL, vIcepresIDenT anD LegaL DIrecTor, LexIsnexIs InTernaTIonaL

Defences against the Bribery Act Companies that are subject to the UK Bribery Act 2010 can avoid being convicted of the offence of failing to prevent bribery if they can demonstrate “adequate procedures” are in place to prevent bribery. These include: 1. Proportionality 2. Top-level commitment 3. Risk assessment 4. Due diligence 5. Communication 6. Monitoring and review For more information, see the UK Ministry of Justice’s Bribery Act 2010: Guidance about commercial organisations preventing bribery, and Quick start guide, both at www.justice.gov.uk.

may well have waited and they now only have weeks in which to try to put something in place. I think that is good grounds for urgent action, but not for panic, because this is a long-term thing,” he says.

While a business can avoid conviction if it can show that it has adequate procedures in place to prevent bribery, a recent guidance document published by the UK Government states that the question of whether an organisation has adequate procedures in place to prevent bribery is a matter that can only be resolved by the courts. “In other words, we’re back to square one,” says Ian McDougall, vice-president and legal director for LexisNexis International (also publisher of Lawyers Weekly). Fundamentally, the new Act creates a mens rea offence; that of “intending” to “induce” “improper” performance of some kind. “When combined with the guidance document advice, it is clear that identical acts may or may not be offences, depending on circumstance and proving mens rea,” he says. According to McDougall, ethics has been a topic of debate since the time of Plato. “I’m not quite sure this Act takes us any further forward in our understanding of what is or is not ethical behaviour. It just says, ‘Let the courts decide’.” However, he believes it is the big fish or utterly flagrant behaviour that the authorities will be after. “Therefore, it is clear that companies need to establish clear policies,” he says, while programs of awareness also “need to be commenced, and probably a program of auditing established for compliance purposes”. McDougall also advises risk management professionals to factor their company’s profile into risk assessments. “The higher the profile, the more likely you are to be in the crosshairs,” he says. “In addition, establish a set of criteria which can help judge what might be higher-risk activities, with higher-risk individuals, so that ‘alarm bells’ can ring where appropriate.” LW

w w w.law yersweekly.com.au


practiceprofile

Perfect harmony? The national harmonised OHS laws are due to start on 1 January 2012. Will they will be effective in reducing red tape and making the workplace safer? Justin Whealing reports

W

hen does a harmonisation process leave people far from calm and relaxed? Evidently, when it involves workplace safety. While the concept of bringing together Australia’s nine separate pieces of federal, state and territory workplace safety legislation has been talked about for many years, the harmonisation process under the current Federal Government kicked off in earnest in 2008 when the Council of Australian Governments made a commitment to adopt a uniform national occupational health and safety model. Although there is consensus that OHS laws need to be simplified, plenty of complexity and ambiguity has arisen from the harmonisation process. Union groups are grumbling in NSW because it might take away their powers to commence prosecutions, while large businesses such as Rio Tinto argue the new laws are too complex, with the proposed new regulations numbering 580 pages in length, and that unions will have too much power in the formation of workplace policy. The harmonisation process has also resulted in some strange political bedfellows. When she was premier of NSW last year, Kristina Keneally said her government would not support the model OHS legislation, putting her at odds with Prime Minister Julia Gillard and NSW Liberal Party leader Barry O’Farrell, who both supported the legislation. Just last week, the O’Farrell Government introduced the harmonised work, health and safety laws into NSW Parliament, describing it as a “win for workers and business”. “There are nine different WHS regimes operating across Australia, and this once-ina-generation change will see thousands of pages of different state-based legislation simplified into a single set of national laws,” says Greg Pearce, NSW Minister for Finance and Services.

14

L AW Y E R S W E E K LY 13 M AY 2 0 11

While there is a long-held notion that if both sides are grumbling, then you’ve got the right compromise, is anyone other than politicians happy with the proposed new laws? “People think that harmonisation conceptually is a really good idea, and I agree with that” says Blake Dawson partner and national OHS head Lea Constantine, whose client base includes some of Australia’s largest national employers across a wide range of industries. “Ultimately it should streamline OHS policy and make it easier for everyone in terms of compliance, but we are not there yet,” she says, refuting the notion that the new laws will usher in a new era of workplace safety overnight. “If people think that come 1 January 2012, these laws will be perfect, they won’t – they will be far from perfect.” There is no doubt that corporate Australia is behind the harmonisation process philosophically, as it will bring all these different pieces of OHS legislation under the one umbrella. However, each state and territory will stay retain a degree of independence in how they monitor and interpret those laws, and that has the business community worried. “I think there is still some uncertainty about the model that has been adopted, insofar as whether it will deliver something that is truly harmonised, because each state has to adopt the Act, and there is capacity for the states to put their own twist on the laws,” says Gadens senior associate Stephanie Nicol. “For example, there will be capacity for the states to nominate their own regulator and to refer the matters to their own courts, and the concern from some of my clients is that the capacity to introduce some of these variables could potentially undermine some of the consistencies these harmonised laws are meant to be achieving.”

White-collar issues are becoming an increasingly important part of traditional workplace health and safety issues” SAMANTHA BETZIEN, PARTNER, MINTER ELLISON

The conjecture about how the proposed model laws will function is magnified by the fact that there are still significant gaps in the legislation. For instance, the mining industry is still waiting for further updates on aspects of the proposed legislation, while the mining sector in Queensland could continue to be subject to a different safety regime. “It is not clear what will exactly happen in Queensland in the long-term,” says Brisbanebased Minter Ellison partner Samantha Betzien, who has many clients in the energy and resources sector, as well as a suite of government clients and businesses operating in the manufacturing and construction sector. “Queensland, for example, will retain specialised safety legislation including in relation to mining. As a result, the mining sector will not be harmonised with the rest of the states and territories. “It remains to be seen whether the specialised mining legislation is amended to reflect the duties under the model legislation,” she says.

w w w.law yersweekly.com.au


practiceprofile

“OHS legislation hasn’t traditionally worked well in terms of dealing with psychological injury; it’s just not set up that way,” adds Betzien.

At the coalface

I think there is still some uncertainty about the model that has been adopted”

Sometimes you are exposed to some pretty awful things”

STEPHANIE NICOL, SENIOR ASSOCIATE, GADENS

LEA CONSTANTINE, PARTNER, BLAKE DAWSON

White-collar OHS crimes Much of the harmonisation debate has centered around traditional blue-collar issues such as the right of union access to worksites and the extent of personal liability for board directors following a serious incident in the workplace. However, issues such as harassment and bullying are becoming an increasing concern for professional and service industries, and OHS and employment lawyers are increasingly being sounded out for advice. “Bullying is a really big area of concern at the moment. We hosted a seminar at the firm a few weeks ago that was really well attended and was all about trying to identify and prevent bullying,” says Nicol. “The thing about bullying is that it’s not very well defined. We all know it can be a risk to safety and can give rise to a lot of other claims, but thus far its legal definition has not been clearly spelt out, as it can be quite subtle as well as overt.” It has been mooted that a code of practice centered around bullying will be drafted before 1 January as one of up to 16 codes of practice that have yet to be released.

With lingering ambiguity about what does or doesn’t constitute bullying and whether it is a code of conduct or a safety matter, many OHS lawyers report that their clients are not certain which basket this increasingly problematic workplace issue sits. “Bullying has always been a tricky issue,” says Betzien. “There are schools of thought that bullying is not dealt with best in an OHS context.” Betzien says that although “white-collar issues are becoming an increasingly important part of traditional workplace health and safety issues”, the current OHS system was not designed to interpret many of these increasingly pressing modern issues. “It is very difficult to deal with under the current workplace safety regime,” she says. “Workplace harassment might be better dealt with in discrimination legislation as opposed to a workplace health and safety context, but there are some exceptions to that, such as if there is a physical aspect to the bullying, which makes it more suitable to deal with in the workplace health and safety framework.

There are few areas of the law that are more confronting for private practice lawyers than OHS. They are often called almost immediately after a catastrophic workplace incident has occurred, and have to deal with confronting and traumatic situations. “Some of this work is not for the faint-hearted,” says Constantine. “Sometimes you are exposed to some pretty awful things.” Constantine is often called shortly after an incident occurs, assisting with the investigation process and any prosecution that might arise. “I am constantly dealing with issues and incidents, and how to best respond to them,” she says. Her duties after an incident often include liaising with the media and union groups, and ensuring that affected employees and family members have access to counselling services. She says that dealing with such matters naturally takes an emotional toll on the lawyers involved. “I am conscious of this as a partner in terms of how I manage my staff,” she says. “I constantly check in with them, and make sure they are OK.” Increased awareness of safety issues in the workplace and the reputational fallout for companies with a poor safety record has led to OHS issues playing a far more prominent role in the development of workplace policies. This means OHS lawyers are often called upon by the private practice colleagues in areas such as project finance, employment law and property and construction matters. “I do quite a bit of work with our property, infrastructure, projects, construction and insolvency groups,” says Constantine. “There is no doubt that OHS issues feature much more in infrastructure projects now, and that is due to the elevation of safety as a major corporate issue. Today in large corporations, it is often the first item to be discussed on the agenda in board meetings.” LW

L AW Y E R S W E E K LY 13 M AY 2 0 11

15


coverstory

The elephant in Growing international pressure has led some of Australia’s largest law firms to take their first tentative steps towards outsourcing legal services – though few are willing to admit it. Angela Priestley reveals why LPO can no longer be ignored

16

l aw y e r s w e e k ly 13 M ay 2 0 11

w w w.law yersweekly.com.au


coverstory

L

egal process outsourcing has, for a number of years now, been at the centre of game-changing developments regarding the delivery of legal services worldwide. But locally, law firms have simply watched from the sidelines as their international counterparts commenced three-way relationships with clients and LPO providers. All that is about to change, according to a number of LPO providers who claim that some of Australia’s largest law firms are currently carrying out due diligence of LPO facilities both onshore and offshore – despite their unwillingness to discuss these investigations. The change is being led by clients as well as the lessons learned from overseas – most notably, that of Magic Circle firm Slaughter & May, which proved that if a firm doesn’t take the initiative to offer LPO solutions to clients, it may find itself in a difficult situation when clients themselves approach LPO providers.

ready or not...

the room

The global LPO market has come a long way since suppliers of business process outsourcing (BPO) discovered the potential to get legally trained individuals into processing centres to assist with low-level legal tasks such as discovery, certain types of drafting, legal research and document review. LPO providers initially started presenting their services to clients and law firms in the late 1990s, promising hourly rates at a fraction of those being charged in large law firms. It was a tough sell: law firms and their clients alike needed to be convinced that the confidentiality, security and quality of their work could be assured. Then the global financial crisis hit. With the pressure mounting on legal departments to reduce their external legal spend, general counsel looked to their firms to offer solutions for reducing hourly billing rates – especially regarding the work usually reserved for juniorlevel lawyers. And law firms had few choices but to respond. Consequently, a number of the UK’s Magic Circle firms, and some of the largest law firms in the US, invested significantly in relationships with LPO providers in an effort to curb costs and present clients with cost-saving options. Meanwhile, if clients found that firms were ignoring their interest in an LPO option, they simply bypassed the law firm altogether and went to an LPO provider direct. In 2009, Rio Tinto did just that. The mining giant declared it would outsource the bulk of its in-house legal work to India via an arrangement with CPA Global in a bid to cut its annual legal bill by 20 per cent.

l aw y e r s w e e k ly 13 m ay 2 0 11

17


coverstory

“They’re having a look at our centres, meeting our people, getting an understanding of the way we operate... [But] they won’t let me talk to you guys!”

At the time, Richard Susskind, author of The End of Lawyers, wrote that given significant parts of the legal work surrounding transactions and disputes are repetitive and routine, “inhouse lawyers will be delighted that these can be packaged out to less costly providers”. The delight has seen demand for LPO grow and consolidation of the global LPO market occur. Market analyst Ovum reported last year that the LPO industry is “set for significant growth over the next few years”, despite being seven or eight years behind the general BPO industry. Recently, the true impact of LPO on the global legal services market was highlighted when legal publisher Thomson Reuters purchased India-based Pangea3, an LPO provider with more than 650 lawyers.

early mutterings LPO providers have long enjoyed growth in legal markets overseas, but interest from Australian law firms and clients has only really developed over the past six months, according to Nicola Stott, a director of LPO provider Exigent. Later this month, Stott says she’ll take a number of “top 10 law firms” on a due diligence trip of one of her LPO centres in Cape Town, South Africa. “They’re having a look at our centres,” she says. “They’re meeting our people, getting an understanding of the way we operate and an understanding of our processes and procedures while also meeting our talent.” But Stott is tight-lipped about which firms will be participating. “They won’t let me talk to you guys!” She says it wasn’t long ago that she faced similar levels of secrecy in London. “But then it became the norm in the UK and, when the GFC hit, everyone was just under such cost pressures that the press occurring in the UK around outsourcing went bananas,” she says. So why the sudden interest from Australian law firms in exploring LPO options? “I think law firms here are being approached by their corporate clients to look at this as an option and to offer it as part of the toolkit of services,” says Stott. Michael Bell, the director of Fronterion, an LPO consultancy based in the United States,

18

l aw y e r s w e e k ly 13 M ay 2 0 11

confirms this. “We had a recent engagement with a major Australian law firm, so this is definitely on the radar for the larger players in the market,” he says. Bell believes Australian firms may simply find they have few choices but to take an interest in LPO. “The international firms in Australia are competing with the international firms based in the US and the UK for their international client base, so it’s a trickle-down thing where major firms in Australia are [now] enquiring about LPO services.”

The conversation gets louder While many of Australia’s largest law firms are still not ready to talk about their ambitions to develop relationships with LPO providers, there are some exceptions to the rule. Blake Dawson has declared that it is discussing outsourcing with clients after developing a new relationship with CPA Global. It wasn’t an easy transition. When partner Tony Denholder spoke about the new relationship at the ACLA National Conference late last year, he himself conceded that just months prior to carrying out due diligence of the CPA base in India, he could never have imagined outsourcing legal work. “I had low expectations,” he said at the time. “I seriously thought that having had bad experiences with call centres, that this would be a glorified call centre,” he said. But that wasn’t the case. Instead, Denholder said he met a number of highly qualified and experienced Delhi-based lawyers, which consequently led to Blake Dawson agreeing to develop a three-way relationship with existing client Rio Tinto and CPA. Advent Lawyers has also expressed interest in LPO via a partnership with Pangea3. According to the firm’s managing director, John Knox, the move – announced halfway through last year – has not seen significant movement in the Australian market by clients immediately taking up LPO, but he says it has resulted in numerous discussions about the potential of LPO. “People don’t all of the sudden say, ‘We’re going to put all our work offshore.’ It’s an education process, where clients have to see the opportunities.” The pace of educating, says

Knox, depends on the client and how much transition they’ll have to go through internally, especially in determining how they will physically manage the outsourced relationship. “Some of those discussions move quickly, some have been going for nine months. It might be that they’re running pilots to see how it would work… It’s less about how Advent and Pangea3 are going to be able to handle the delivery of services and more about how the clients will resource and handle [the outsourcing work] internally.”

silence is not an option In a global study undertaken by Exigent last year, 57 per cent of clients declared that their LPO questions for law firms would inform future

w w w.law yersweekly.com.au


coverstory

LPO’s global reach Fronterion predicts 2011 will be pivotal for the development of the legal process outsourcing industry worldwide. Below is the LPO consultancy’s top-10 outsourcing trends for the year.

1. A fundamentally changing legal profession: Continued downward pressure on costs and the globalisation of legal services provide a perfect environment for LPO. Those who refuse to engage with LPO will increasingly become a minority – the industry can no longer be ignored. 2. Enterprise approach: Many firms already outsource legal work at partner or department levels. However, LPO is more effective and efficient when a firm implements a firm-wide or “enterprise” approach, led by senior management. 3. Onshore expansion: The growth in onshore and hybrid on/ offshore delivery solutions will begin in earnest in 2011. This trend will be equally prevalent in the United States and United Kingdom, with LPO providers and firms already building capacity.

decisions regarding the purchasing of legal services. A further 39 per cent said they were still undecided, while just four per cent reported that LPO-related questions would not impact future purchasing decisions. Clearly, clients see the potential in LPO and are expecting their law firms to give some consideration to outsourcing solutions – if not immediately, then perhaps in the near future. For now, though, legal process outsourcing remains the elephant in the room. With time, the conversation regarding LPO between clients, law firms and LPO providers – or at least between clients and LPO providers that choose to bypass law firms altogether – will finally get under way. LW

4. Expanding client geographic/ jurisdictional reach: Demand for LPO services will spread to new markets. In the US, law firms in Texas, the Midwest and the Pacific Northwest are potential growth markets for LPO. In the UK, regions outside of London are also emerging growth markets. However, continental Europe will remain a challenging environment for LPO. 5. Progressive value proposition: LPO providers will have to offer more services and a more progressive value proposition to remain competitive. Alongside traditional litigation support, LPO vendors may also have to offer contract portfolio servicing, compliance, diligence, human resources, medical and broader legal support functions. 6. Increasing technology applications: As a result of the growing importance of technology, LPO vendors will use

technology as a key selling point. Technology platforms will be used to offer diversified services and as a means for vendors to further embed themselves in client organisations. 7. Dynamic vendor landscape: The unprecedented growth and industry consolidation initiated in the fourth quarter of 2010 will continue to shape the dynamic LPO vendor landscape in the coming year. Overall, these consolidation trends are positive for the industry, as vendors emerge stronger, more capitalised and, most likely, considerably larger. 8. Public acknowledgement: The growing acceptance and adoption of onshore and offshore LPO will become more visible in the coming year. This will become increasing prevalent in the US where, in the past five to six years, corporations and law firms have remained virtually silent on all LPO-related matters. 9. Divergent vendor approach: Competition means that LPO vendors will have to differentiate themselves from each other in terms of services offered and delivery models. No dominant model exists (yet), and a range of different approaches will emerge next year. 10. Ethical guidance: Regulatory bodies start to address the changing legal landscape. In the US, ethical commentary is expected from the ABA’s Commission on Ethics 2020. In the UK, announcements are expected from the SRA and the Law Society. Other jurisdictions that have been silent so far – such as Australia, Canada and South Africa – may follow suit. For the full report, see www. fronterion.com.

l aw y e r s w e e k ly 13 m ay 2 0 11

19


career

counsel

Talent legally processed Working in a legal process outsourcing centre can offer valuable experience and benefits such as work/life balance WHEN WE think of some of the largest employers of lawyers worldwide, firms such as DLA Piper, Clifford Chance and Norton Rose come to mind. However, with the solid growth of the global legal process outsourcing (LPO) market in recent years, hubs of legal talent are now being centralised in LPO centres across India, South Africa, New Zealand and Australia. Already, some of these centres employ up to 1000 lawyers – a figure likely to grow significantly as more clients and law firms seek LPO solutions in the future. For many Australian lawyers, dealing with legal tasks deemed simple enough to be outsourced may not be the ultimate career ambition. But, according to Nicola Stott, a director with LPO provider Exigent – which has centres in Rockingham, Western Australia, and Cape Town, in South Africa – there’s much a newly qualified solicitor or paralegal can gain by working in LPO. “The range of talent we have is everything from the graduate lawyer and paralegal to the four-to-seven-year PQE level,” says Stott. “It’s a

whole range of skills and experience that we have across different sectors and disciplines. At the graduate level, there are plenty of candidates coming out of law school – they’re easy to find.” Stott says that in Cape Town, where unemployment is particularly high, the positions offered by Exigent are highly sought after. “It’s partly the work/life balance, and it’s partly the ability to jump up the ladder more quickly and to be able to work on the higher-value work than they could in a [local] law firm… And while their base salaries don’t match those of a law firm, they do have attractive bonus schemes.” Meanwhile, Indian-based LPO providers such as Pangea3 frequently recruit senior lawyers from legal markets in the United States, United Kingdom and Australia to take on well-paid, supervisory and quality control-type positions. Currently, Pangea3 is recruiting a US litigator/document review manager for their India base – a position paying up to $150,000 a year, plus benefits and equity. According to Pangea3, local lawyers employed in India can receive US law firm training in an American corporate-like culture

my

76 % 86 % SOURCE: OFFICETEAM

20

L AW Y E R S W E E K LY 13 M AY 2 0 11

of office support staff and administrative workers in Australia feel forced to work outside of regular office hours

of support staff and administrative workers come into work when feeling sick

and entrepreneurial environment with merit-based career advancement potential and equity participation. Around 80,000 Indians graduate from law school every year, adding to the one million-plus lawyers already practising in India. It’s a large market pool, but one that is constantly tapped to keep up with talent demands. New Zealand-based Latitude South, which takes on legal work from the UK, only hires lawyers with UK and international experience. At around £80 pounds ($122) an hour for legal services, the Latitude South rates are not cheap but reflect some high levels of experience – as well as new opportunities for lawyers who have recently returned home.

next move

With Gail Greener, senior consultant, Dolman Legal Search & Recruitment

Q A

When should I start looking to specialise?

It is not uncommon for lawyers to fall into a practice area and stay there. And the further into your career you are, the harder it is to change areas, so it is essential to make the right decision early on. Consider choosing an area of specialty in which you have a real interest. Then make a conscious effort to move into the area by enrolling in educational units that relate to your particular interest and gaining exposure to as many different areas within that specialty as possible. If your grand plan is to work overseas or move in-house, it is worth considering that there is generally more opportunity for lawyers with experience in transactional areas. If there is a specific industry

sector you are keen on, then make it known to the partners and senior lawyers and put your hand up for any work that arises with clients in that area. Networking, discussions and obtaining advice from the partners and other senior colleagues will help you get a feel of what your career in that area will look like. As an associate-level lawyer it is important to keep your experience broad, as this versatility will enable you to apply your skills across the range of work available and keep your options open. As you start to reach the senior associate level, and especially if partnership is sought, it’s important to become more specialised, as this will allow you to differentiate yourself and be known in the industry as the go-to expert. Ultimately, this will raise your profile and develop your client base.

w w w.law yersweekly.com.au


ANNOUNCING

2011

Awards

Recognising excellence, innovation and leadership within the Australian legal profession

2011 categories include: Life Achievement Award Young Gun Award In-house Lawyer or Team Award Managing Partner of the Year Award KEY DATES: Nominations open

Friday 8 April 2011 Nominations close

Friday 17 June 2011 Winners announced

Thursday 4 August 2011

Deal Maker of the Year Award The College of Law - Law Student of the Year Award Practice Manager of the Year Award Box Breaker Award Talent Manager of the Year Award www.lawawards.com.au

20

L AW Y E R S W E E K LY 2 2 A P R I L 2 0 11

w w w.law yersweekly.com.au


folk

law

Irish lawyer makes his own luck An Irish lawyer has quit the legal profession in a very public way by declaring his intentions before a courtroom full of stunned onlookers. RollonFriday reports that Dublinbased solicitor Martin Coen threw in the proverbial towel at the Dublin District Court recently when he made an announcement to the presiding judge, Hugh O’Donnell. “From this day forwards (sic) I am no longer practising as a solicitor,” said Coen with glee. Apparently enjoying his final moments in the sun, he added that his decision to chuck in his legal career was due to “judicial corruption within the system, particularly in Blanchardstown District Court”. Coen has apparently practised as a solicitor in Dublin since 2004 and it is not exactly clear what triggered his little tirade. He later told the press that “I do not want to go into details, but I am finishing my practice ... I will let matters speak for themselves.” How very mysterious... Folklaw wonders whether Blanchardstown District Court will soon be exposed as a hotbed of sordid behaviour or corruption. We won’t be holding our breath.

Pressure mounts in billable hours race Folklaw admits that, on occasion, we engage in a bit of lawyer-bagging. But in this particular instance, all we can do is sigh, shake our heads and acknowledge that we actually feel sorry for you. As if there wasn’t enough pressure on poor old lawyers already, UK firm Taylor Wessing has introduced a splendid new policy whereby details of its associates’ billable hours will be sent around the office for all to see, criticise and scoff at. RollonFriday reports that the firm started telling associates how many hours have been recorded by their colleagues over the past month, as well as the year to date. Folklaw imagines that, naturally, all associates must be thrilled with this decision and will just love the extra dose of heart-thumping, gut-churning, chest-constricting pressure – with those who fall short of the daily demands having their dirty laundry, so to speak, flung around the office.

Taylor Wessing’s move follows the recent news, reported in Folklaw last week, that lawyers at Reynolds Porter Chamberlain are being publicly shamed with red computer screens if they do not bring in the pounds. A spokeswoman for Taylor Wessing told RollonFriday that the new policy was an attempt to get associates to share work among themselves more equally. Well, that was our English translation of the corporate speak below: “Obviously, as a result of trialling the publication of utilisation rates to each of our business groups independently, we introduced a spirit of competition to ensure those hours are achieved, but our goal was also to help associates manage their workload by equalising what was at the time an uneven use of capacity. We are reviewing the impact of this trial on an ongoing basis to ensure it remains effective.”

Bubbly flows and tongues loosen at Clifford Chance launch party Folklaw loves a party, so it made sure the postman was not taking a sickie when it got wind that Clifford Chance would be having its opening shindig at Guillaume at Bennelong at the Sydney Opera House on 3 May. With live music playing and the beautiful surrounds of Sydney Harbour in the background, Mark Pistilli, the Magic Circle firm’s

22

L AW Y E R S W E E K LY 13 M AY 2 0 11

new Sydney managing partner, welcomed the assembled guests. And just to emphasise how relieved everyone is that his firm, Chang, Pistilli & Simmons – alongside WA-based Cochrane Lishman Carson Luscombe – can now be simplified to “Clifford Chance”, he mixed up the order of the CLCL names. An easy thing to do. As the mood loosened, and fine wine was served with accompanying canapés in a combination of animals

and condiments Folklaw didn’t realise were scientifically possible, we wandered the room looking to speak with any of Clifford Chance’s international lawyers to ask why they have set up shop in a country that is notorious for its high-quality lawyers and competitive marketplace. Folklaw didn’t have to go far for an answer. One senior partner told us that a particularly well-known large Australian firm was rejected as a suitor because “it was too large”. Meanwhile, a China-based partner said that although Australian lawyers are well regarded and the

firms are seen as competent, they are not among the heavy hitters on the ground. “Why not?” asked Folklaw. “Because they don’t have the head-count we have,” replied another partner. As Folklaw continued to press the flesh, it couldn’t help but notice the considerable number of clients and prominent lawyers in attendance from other firms – such as Peter Slattery, the managing partner from JWS. But alas, we didn’t spy Robert Milliner from Mallesons. Folklaw speculates that it would be like going to the wedding of a former lover.

w w w.law yersweekly.com.au


Kathryn Parry Private Practice Sydney

taylorroot.com.au

Expect us to think longer term In some recruitment companies all that matters is the next placement fee. At Taylor Root, our consultants are encouraged to think longer term, providing clients and candidates with advice that’s in their best interests. It’s an approach that’s served us well over our 22 year history and helped make us the global leader in specialist legal recruitment. For more information contact us on +61 (0)2 9236 9000 or visit taylorroot.com.au

THE SR GROUP . BREWER MORRIS . CARTER MURRAY . FRAZER JONES . PARKER WELLS . SR SEARCH . TAYLOR ROOT LONDON . DUBAI . HONG KONG . SINGAPORE . SYDNEY . MELBOURNE

Lawyers Weekly, May 13, 2011  

Australia's leading publication for the legal industry. This issue: we examine the elephant in the room -- legal process outsourcing, examin...

Read more
Read more
Similar to
Popular now
Just for you