In response to recent story about the biggest cause of SME disputes, Stanislav Roth, founder and managing director of Source Legal, said that people “love to hate” lawyers, but that the legal industry has three particular aspects that drive the majority of this resentment.
Mr Roth, whose firm was crowned Business of the Year at the 2017 Optus My Business Awards, said the first of these is the industry’s standard billing practice.
“Clients hate knowing that when they’re talking to a lawyer, the clock is ticking,” he said.
“Do you need to get some advice over the phone? Tick, tock. Need a contract to maximise certainty and value for your business? Tick, tock. What about making a claim against a fraudulent supplier, or instigating litigation to protect your intellectual property? Tick, tock, tick, tock.”
He said this process “creates enormous anxiety for businesses” in need of advice but unsure how long it will take to obtain, and hence how much it will ultimately cost.
The second pet hate is response times, with delays in obtaining legal advice holding up decision-making and operational processes.
“Legal issues come up all the time as you’re running your business, and they usually have a bit of urgency to them,” said Mr Roth.
“It might be a small thing, but you need legal advice to be able to make a decision and move forward. Yet one of the most common complaints is that lawyers take too long to respond, and too long to give advice.
“It’s a continual bugbear for businesses, who hate being left hanging.”
Rounding out the top three complaints of businesses against the legal profession, according to Mr Roth, is advice that is difficult to understand.
“We all know the jokes about how lawyers can take an entire convoluted paragraph to describe something that should just take a couple of words. This old-school habit of hiding behind legalese is endlessly frustrating to businesses, who are under pressure to make decisions in complex circumstances,” he said.
“Moreover, too often businesses receive legal ‘advice’ that seems to be more concerned with avoiding any risk for the lawyer, rather than focused on providing business-oriented solutions. What businesses want is simple, practical, straightforward advice that can be easily understood, yet what they often get is advice that requires translation, and still leaves them wondering.”
Industry push to change from within
According to Mr Roth, a “new generation of lawyers and law firms” are trying to shake up the traditional legal industry and these long-held concerns of business clients.
This internal movement even has its own name – NewLaw.
But another legal industry figure, LegalVision CEO Lachlan McKnight, believes that business clients will not see the full benefits of this movement for another five to seven years.
In an opinion piece published in My Business’ sister title Lawyers Weekly at the end of 2018, Mr McKnight lamented that “NewLaw gets a lot of coverage in legal industry publications … the amount of coverage NewLaw gets when compared to the actual size of the businesses involved is, however, completely out of proportion.”
“LegalVision is one of the biggest and fastest growing NewLaw providers in Australia, and we’ve only just hit $20 million in annualised revenues and 100 team members. We’re about 25 times smaller than the biggest law firm in Australia!” he said.
“NewLaw will only have made a real difference to the legal landscape when a NewLaw provider hits $200 million or so in annualised revenues. Hopefully, that’s LegalVision, but if it’s not someone will do it, and it will happen in the next five to seven years.”
According to Mr McKnight, fixed fees are becoming more prominent among legal firms, but that there is scope to further shake up billing practices to benefit clients “by breaking the linear relationship between the time taken to complete a task, revenue and profit”.
He also said there are great strides to be made in improving customer service and the deployment of technology.