Law Society vice-president's firm applies to be ABS
A virtual law firm set up by the incoming president of the Law Society has applied to become an alternative business structure, so that its lawyers can share profits without the regulatory burden of becoming a partner or director.
Scott-Moncrieff & Associates LLP (SCOMO), run by current vice-president Lucy Scott-Moncrieff (pictured), comprises around 50 ‘consultants’ serviced from a central hub. None of them is a director of the LLP and they do not therefore have the duties and liabilities that go with directorship. They simply retain 70% of what they bill and the balance goes to the firm. After overheads are paid, this generates a profit for Scott-Moncrieff.
She said: ‘The consultants like doing their own thing and not having to get involved with practice management. The snag is they just eat what they kill – they don’t share in the firm’s profits. Once we become an ABS, they can carry on as before or they can buy shares and have a stake in the firm’s future.’
Scott-Moncrieff said that selling shares was a good way to retain existing lawyers and attract new talent. She said: ‘I’m going to retire one day and want the firm in safe hands. We could make bigger profits if we spent less time on supervision and on making legal aid pay, but the firm’s ethos is important to us all. The new ABS model is a way of going forward without commoditising our service.’
She added that her firm’s planned conversion underlines the fact that ABS status is not just about large corporations. ‘It is not about size. It is about having an underlying structure in place to protect the interests of clients,’ she said.
Next week, it will be six months since the Solicitors Regulation Authority began accepting applications for ABS status. Seven have been approved and 30 more are in their latter stages.