ABS offers barristers at £75 an hour
A new law firm which promises clients fixed fees and immediate face-to-face meetings with barristers has become the latest alternative business structure (ABS).
Red Bar Law was formed in September last year and applied to the Solicitors Regulation Authority for ABS status in January. Today the SRA confirmed it has become the ninth organisation to be granted a licence, which will be effective from 10 July.
The firm was set up by management consultant Hatti Suvari and solicitor John Esplen (both pictured), a partner for seven years at south-east firm Barnes & Partners.
Suvari said Red Bar Law has a roster of 120 barristers for work in litigation, divorce, probate, contract law and professional negligence. ‘I don’t believe any other firm works in the same way that we do,’ she said.
‘We offer fixed pricing from the beginning and take them to the barrister from day one to give them a more informed opinion from the beginning.
‘This gives us a chance to negotiate with the barrister - we can pay them within 24 hours of the case being taken on and they’re happy to reduce their prices because they know they’ll be paid immediately.’
The firm’s website sets out the prices which it says clients can expect to pay for legal work. It promises that divorce cases with a small asset base will cost between £10,000 and £12,000, with cases involving a large asset base costing up to £35,000. Contract issues such as a sale or purchase of a business can be resolved for £4,500-£6,000, whilst litigation matters cost from £1,000 for small issues to £40,000 for complex cases.
The pricing structure stipulates that a barrister’s opinion can be obtained from as little as £75 per hour. The firm states it will save at least 30% on costs for all clients, adding: ‘A traditional law firm will often quote you a lower figure at the beginning of your matter. We strongly believe that clients are best served by knowing the realistic costs from the outset.’
Suvari said the firm, which is headquartered in Holborn, will later this summer seek to add to its staff solicitors who can work from home.
Comments
A Changing Legal Market
This is another innovative way that the legal market is changing, and its changing at pace. A lot of chambers are looking for new ways to compete without a solicitor and this model represents an interesting one that helps reduce costs to the client whilst ensuring fee notes are not left unpaid for months or years.
Many barristers are looking to maximise direct access and procurement companies, which if successful, will impact on more traditional law firms. There are also a number of other models outside of ABS which are beginning to emerge in the market place, but it is still a huge concern to see so many mergers, firms going bust and intensifying competition in the backdrop of access to justice issues around public funding and CFAs. I wonder whether client's are understanding what is happening, or just don't care since ultimately it will be them who come running to the regulators when things go wrong! Interesting times indeed.
Interesting approach.
Interesting that they are positioning the barrister as the experts in every case and offering an informed opinion from counsel from the outset.
Maybe as solicitors we should be specialising to the extent that we consider ourselves the expert in the majority of cases?
It never occurred to me that we could get a discount from counsel by paying immediately!
Fees
I wouldn't fight on the battleground of having the lowest fees, myself.
That said, their quoted fees e.g. for 'small asset base" divorce looks high to me, what do others think?
Fixed fees are nothing new, we've had them since I started the world's first virtual law firm in 1996, see www.family-lawfirm.co.UK for examples.
But anything which seeks to bring barristers client service up to our levels is a good thing, most are seemingly incapable of even basic care.
Pointless exercise
At the sort of prices mentioned I don't think most solicitors have anything to fear from this competitor. " ... divorce cases with a small asset base will cost between £10,000 and £12,000." Well good luck with selling that to the average client outside London.
In any case, involving a barrister in such matters as the sale of a business is unlikely to add anything useful, as most barristers have little practical experience of actually negotiating such agreements. I can imagine that they will come up with lots of academic points that will be simply irrelevant in the day to day haggling over the terms of a contract.
There's also the continuing problem that the barrister can't actually process the work, and can merely advise, so there will still have to be a solicitor involved, who will also be charging - and probably a lot more than £75 an hour.
In any case, a competent solicitor shouldn't need counsel's advice on everyday matters such as described here.
The amount of discount that any decent barrister would agree for immediate payment is probably neither here nor there, which means that £75 an hour is basically all these barristers can charge anyway. That implies that they are not exactly in high demand, and I would guess that most of them are newly qualified and short of work.
It sounds to me like it's primarily a marketing exercise (and I note that one of the directors is a management consultant) that is trying to give the impression that advice from a barrister is somehow inherently better than that from a solicitor. For many practical purposes it's actually the other way round.
I had to check my diary to make sure it wasn't April 1
So they really think that clients are going to pay £40,000 for complex litigation cases upfront do they? I had to check my diary to make sure it wasn't April 1.
And I'm looking forward to seeing barristers being paid just £75 per hour – when for that price, presumably, barristers will also be responsible for all the time-consuming admin requirements including setting up the file, carrying out identity and money laundering checks, closing the file and storing it - and leaving enough cash over to pay for the huge marketing campaign which will be required to generate this amount of work .
Prices
The website indicated that the "prices" quoted in this article are, in fact, illustrations, not "promises". Indeed, no lawyer in his his right mind would offer to conduct a large piece of litigation for £40,000, unless his definition of" large" is very different from mine.
Fees
Well it just shows the sort of cases they consider large!
ABS and barristers fees
We'll do the divorces for 10% less on the scales quoted in the article and the client wont have the trouble of having to go to someone else.
Apart from that why would the client wish to use the Solicitors when on a private basis the client could access the barrister direct.
Further still all solicitors are obliged to give a realistic overall costs estimate at the start so the entire basis of this new service is rubbish from the start.
Sounds to me like a lot of old tosh!
Where's the 'like' button
Where's the 'like' button Michael.
Here in the north Midlands I
Here in the north Midlands I don't think I'd get much work if I offered sale or purchase of a small business at £4500 - £6K, as (a) hardly any small businesses sell as nobody can get the funding let alone afford the rents so (b) competition is fierce and £1500 - £2500 is more like it. On divorces with a small asset base, well that depends on how small is the asst base, doesn't it. £10K - £12K?? - dream on... Mind, this is probably because they don't use 'stuffy and intimidating solicitors', 'time-consuming and stuffy solicitors', and don't use the 'legal jargon used by solicitors'. And they promise to help 'quickly and efficiently' - so when they issue their debt claims in Salford, how will they then explain to their client the 3-4 week delay before you hear anything from the Court?
Have a look at their website, http://redbarlaw.com. It's priceless. How about this, 'Clients are increasingly dissatisfied with the approach of a traditional firm of solicitors as they are often left feeling intimidated and confused, whilst facing legal bills far higher than they expected. Modern times call for modern services. Red Bar Law recognises this and takes pride in giving everyday people an impeccable service.'
Personally I call this bringing the profession into disrepute.
Missing the point
Interesting cross-section of views here: "April fools (load of tosh)" to "game changing". Personally I found the statement "to give [clients] a more informed opinion from the beginning" a little hard to take. Solicitors are, by and large, mindful of business factors such as, oh I don't know, the future business relations of their clients, win/win settlements, client care, etc. whereas my experience of barristers is that they are "above all that" and are focused primarily on the merits of the case rather than the outcome - often two very different things. Fundamentally, there is a reason why there are two professions in this country, not one.
Having said all that, solicitors also, by and large, think they're special in some way and so can charge "special" amounts accordingly. And it's here where I find myself in rare agreement with Richard "no one ever checks if my past predictions come true" Susskind - solicitors have for a long time enjoyed a monopoly on special knowledge. That monopoly is (gradually) being eroded and, funnily enough when a monopoly is diminished, prices fall.
Capitalism. Don't you love it?
true fees
Having read briefly almost every comment from above I am still surprised that someone found decent law professionals - here barristers - to work for such low fees. The client pays 75 an hour to the firm which in turn pays something after deducting its share to the barrister. My reckoning is that the end result is somewhere between 30 and 40 per hour for the barrister, most probably towards the lower end. This kind off begs the common sense questions as how are those rates possible and whether the client is missing out on another lawyer charging over 200 per hour in terms of skill and know how? I certainly hope that there is enough sense out there for customers to investigate further before trying.
Presumably the firm has an own base of admin staff and paralegals because otherwise customers will also pay 75 an hour for someone to arrange their files, do the photocopying, primary research and investigation, etc - hence the obvious reality of over-charging. If the firm does not have an own base of admin staff to do the admin and light legal work then this rather seems a clever way of selling something which already existed by putting a flat rate between what persons usually involved in the running of a law firm.
My feeling is that any new
My feeling is that any new entrants to legal work will have to force prices up in order to make it profitable. Slogging it out on price with small firms scratching a meagre living is hardly a sustainable business model.
I think the website is
I think the website is excellent!!
The next time I have a pathetic moaning client complaining about the fees, I'll refer them to this website, and point out that they are at the lower end of the market.
We had a client moan yesterday about my "ridiculous" (and that is a direct quote) fixed fee charge quote, to issue a claim based on non-payment of an insurance premium, and serve it in Gibraltar, for £12,000. The quote was £200 plus VAT plus court fee, but if we could validly serve it in England and Wales (perhaps according to the contract or on a branch office) we would do it for £102 plus VAT plus court fee (less £20 discount on the court fee). But this was "ridiculous" as all we are doing is filling in a form which they can do themselves.
I also agree with the points made above about the use of barristers. This may sound great to a marketing consultant who doesn't understand the reality of the profession, but I'd love to be a fly on the wall when a junior barrister phones up a plastering subcontractor who wants to be paid based on an estimate he wrote on the back of a cigarette packet and the main contractor relies on a seven page JCT contract.
This type of model just shows
This type of model just shows how desperate certain sections of the bar are at the moment. They are essentially willing to become consultants being paid £40 per hour before tax and to deal with the SME market. Even if they are busy with this work 4/5 hours a day, it still translates to around 2k a month after tax!
Those barristers working under this model are going to have one hell of a shock when they realise the extent of client care and relationship building they have to do to service the SME market. It is ultra competitive and prices are at rock bottom already. You've got employment law departments servicing non-contentious drafting and advice for £500 A YEAR in the hope more work spins off from the relationship, and the amount of work required to keep the client happy is still huge. Such a company is unlikely to be too thrilled when calling up for advice on an employment law problem and then getting a bill for £150 plus VAT each time an issue arises when they can get a year's advice for £500. Not gonna happen. And the larger clients who want sound, practical, problem solving advice are simply not going to get it from counsel. That is not, in my experience, an area where barristers shine at all! They don’t have it in their DNA.
To be honest, the marketing is fairly offensive. I'm a solicitor of 6 years experience in employment law and I know there are no barristers out there (aside from in perhaps 5 London sets) of my age and experience who have anywhere near the depth of knowledge or experience I have in my area. Why? They don't have enough work to sustain their practice in this area and so have to cover 3/4 areas until they build enough of a reputation to be able to specialise, usually at 8 - 10 years call. The same is true with any decent employment law department in a private law firm with good clients. We only use counsel for advocacy if we are unable to attend or on an insurance panel, or very senior counsel when dealing with telephone number sized cases. The work is drying up for them as we are increasingly conducting tribunal advocacy ourselves and profiting from it.
Unless you’re at the top or truly remarkable, life as a barrister in most areas is bleak.
That is a good point - and it
That is a good point - and it feeds into the other article on here about barristers and referral fees.
In my litigation practice, I don't use barristers in the way that I used to even a few years back. Then, we would start off, have a "con", get the client in, start chatting, the barrister would say blindingly obvious things like "you'll have to get some statements off your witnesses". We'd instruct the barrister to do the interlocutory hearings, and if it went to trial along he or she'd go.
Now, I use barristers:-
That's about it. In most cases, the barristers who are instructed get the brief and their job it to turn up and do the trial. They're just a more expensive and more skilled version of the solicitor agents we use for low value cases, and enforcements, etc., through the national agencies. Occassionally we ensure we give them the odd bit of work to keep a relationship, but even that's becoming not worth it, as when we do need Counsel as per the above list, it is rarely from our local chambers.
I think the same will happen in criminal. The law of unintended consequences works wonders. The bar think they'll keep their privilege by using QOCS and bleating about referral fees. I don't suppose its occurred to them that if QOCS shuts out solicitor advocates because they don't do enough trial work, that solicitor advocates will compensate by ... doing more trial work! Anyway, that's another topic for another thread, but I think we are seeing the last attempts by the bar to continue in existence, and I doubt it will be successful.
When I said QOCS, I meant
When I said QOCS, I meant QASA. acronym overload
DomCoop "We had a client moan
DomCoop
"We had a client moan yesterday about my "ridiculous" (and that is a direct quote) fixed fee charge quote, to issue a claim based on non-payment of an insurance premium, and serve it in Gibraltar, for £12,000. The quote was £200 plus VAT plus court fee, but if we could validly serve it in England and Wales (perhaps according to the contract or on a branch office) we would do it for £102 plus VAT plus court fee (less £20 discount on the court fee)"
Where can we find you DomCoop because think thats good value and we need to issue a claim, perhaps overseas or at a branch office in England.
^^^Dom is only so cheap
^^^Dom is only so cheap because he instructs counsel on 'Day One'. Like so many others on here, he spent six years getting qualified to act as a postbox. Career satisfaction assured.
J/K Dom;)
The Market will decide
The market will decide. Mind you, the last time I priced up a fixed-fee small asset base divorce (which, to be fair, was in 2000), the quote was £1400.
The most telling thing on their website is this quote 'A Barrister will invariably charge a significantly lower rate than a traditional solicitor. This is because they work for themselves and are not faced with the costs of running an office and paying for staff.'
Leaving aside the blurring of the edges of accuracy about barrister cost bases, what is it implying about solicitors?
@Joe Reevy
That solicitors are employing staff for their own benefit probably because they like to socialize while a barrister does not employ staff and by comparison are busy bees acting as lone wolfs focused solely on solving the client's problems.
I did not read the whole article but the reasoning coming out from the cited part is similar to that of a shoe-maker in the issue how to efficiently use stealth fighters.
As well as these face to face
As well as these face to face cheap fixed fee barristers, I have noticed a lot of online services cropping up.. offering direct access barristers for a fixed fee. http://www.advisemebarrister.com This one for example. I am unsure whether this is literally just advise (i.e. you pay us £150 and we answer one legal question) or whether these barristers are actually available to go ahead and represent in court. I am on the fence with this. One part of me thinks excellent idea, the other says how can it be so cheap? I suppose it depends on what the client gets included for this 'fixed fee'.
John
If you pay peanuts....
If you pay peanuts....
As others have pointed out,
As others have pointed out, the marketing is offensive and bring the profession into disrepute.
These boys are regulated by the SRA.
I am contemplating a complaint to the SRA, and urge to do so too.
Grow up! The SRA is on THEIR
Grow up! The SRA is on THEIR side -they will pay more fees.