With many Scottish firms heading south and more than 600 Scottish-trained solicitors working in London, is the gulf between the two systems really as wide as some believe it to be? asks Stephen Ward

Size and its separate legal code go a long way to explain why most Scots feel fervently that their jurisdiction is sufficiently different from England not to require the same post-Clementi regulatory framework as England and Wales.


While the Law Society south of the border goes ahead with balloting its membership on plans to separate Chancery Lane’s regulatory and representational functions, its Scottish counterpart has rejected such a move, in response to a Scottish Executive consultation on proposed changes to the profession’s complaints-handling and regulation (see [2005] Gazette, 18 August, 4).

‘There is a cultural difference,’ says Douglas Mill, chief executive of the Law Society of Scotland. ‘We don’t have anything that remotely resembles the City of London in scale. We run a much more collegiate legal profession. That’s no criticism of England – it’s just a product of having only five million people with just five law schools.’


Another aspect of practice in Scotland is that solicitors retain the reputation of being hommes d’affaires to a greater extent than their English or Welsh counterparts, acting as their clients’ advisers more widely. That perhaps explains why Scottish solicitors have successfully maintained their interest in selling property. Half of the estate agency market, including almost total domination in Edinburgh, is theirs, but efforts to export the concept south – where once it was also prevalent – have proven hard going.


Mr Mill says Scotland has not seen the public loss of confidence in complaints-handling its southern neighbours have worked so hard to address. The Justice Committee of the Scottish Parliament, as well as the Scottish Executive, has examined the system and it concluded that profession-led regulation is the best model for a jurisdiction of the size and nature of Scotland.


Michael Collins, managing partner at the Glasgow office of UK/US firm DLA Piper Rudnick Gray Cary, and an English-qualified solicitor, says that ‘as an Englishman abroad’, he would agree with that analysis. There is less compelling need for the Scots to contemplate separating functions or making any dramatic change to regulation. ‘I think it’s a much, much smaller society up here and the lawyers here clearly feel much closer to their law society than I ever did as an English lawyer to my society.’


But in some ways, the differences between London and Glasgow are no greater than between, say, Leeds and Glasgow. Neil Cochran, chief executive of Dundas & Wilson, one of the big four Scottish-based law firms, with offices in Glasgow, Edinburgh and London, says: ‘Dundas & Wilson sees itself as a UK practice and very much approaches the UK as a single market, including the sharing the expertise of partners and fee-earners wherever it is needed. I often think that the distance between London and Scotland looks far greater when viewed from the south than from a Scottish perspective.’


Magnus Swanson, chief executive of another of the big four, Maclay Murray & Spens – which has more than 120 lawyers in London since a bolt-on merger with The City Law Partnership earlier this year – says the reason for expansion in London was not that there was insufficient work in Scotland. He says clients see the UK as a single entity, and so does his firm.


DLA moved into the Scottish market as part of a strategy to become a UK law firm – if it was going to be a serious national law firm, the nation should include Scotland, Mr Collins says. And if it was going to be there, it wanted a serious rather than a token presence. It already had large offices in Birmingham, Liverpool, Leeds, Manchester and Sheffield.


He finds it odd that so many English firms seem to think a Scottish presence is not necessary for a national firm. Pinsent Masons, with offices in Glasgow and Edinburgh, is a notable exception among City firms, while trade union practices Thompsons and Russell Jones & Walker have associated offices there.


The biggest obstacle to including Scotland in a single British legal market is the separate legal code – but, as Mr Mill says, this is often overstated. ‘There are areas of law where you would have to search hard to find a difference between English and Scots law. Take tax or corporate, where work can flow in either direction without difficulty, and human resources law as well,’ he says.


Mr Colllins, who has a corporate background at DLA, agrees: ‘Remember most of the time lawyers are not doing any law – they are transacting deals where there is an applicable law, but only a small part of the discussions relates to what law you are applying.’


Mr Swanson says Maclay can use its lawyers to cover work in London even if their home base is in Glasgow or Edinburgh. The litigation and property teams in London are English-qualified because the law is different, but he echoes Mr Collins’ view of the many similarities and overlaps. He says most clients do not see Scotland as a separate world just because it has a different legal code.


Even at a smaller firm like Dickson Minto, a hugely profitable 16-partner firm evenly split between London and Edinburgh, a leading corporate finance specialist is, as Mr Mill says, easily able to straddle the two jurisdictions.


In Scotland, the sectors are broadly similar to England, Mr Collins says, but with a different emphasis. ‘There is a very substantial amount of public sector work,’ he says. ‘The decline of manufacturing is probably worse in Scotland than anywhere in the UK. The big areas for growth are in leisure and the service industries.’


Of the 1,300 Scottish law firms, 520 are sole practitioners. Scotland is still a large geographical area with a relatively small, diffuse population compared to the density of most of England.


Although there is a divide between the commercial solicitor and the high street – as in England – the divide in the profession is much less pronounced, Mr Mill says.


Mr Collins explains that most English firms have historic relationships with a Scottish firm, as his own did before it set up a base north of the border. ‘There are plenty of good Scots law firms and the English offices of DLA were using a variety of them.’ He adds that referral work is more valuable to the firm receiving it. The one passing it on just needs to know it is done well. The compelling factor for DLA was wanting to be able to tell clients that the work could stay within the firm even if it was in Scotland, he says.


The other way round, the economic logic is different. ‘Generally there is a movement from the north to the south,’ Mr Mill says. ‘That is all about size of market. There is nothing in Scotland which remotely resembles London [in size].’


Mr Mill reckons the 600 Scottish-qualified solicitors working in London mean it is edging up as the fourth biggest Scottish legal city, with Edinburgh and Glasgow ahead, but approaching Aberdeen or Dundee in scale.


Mr Mill says: ‘The law firms follow the business. Why else would you have some 20 law firms with offices in London? They didn’t turn up with no clients, set up a desk and telephone and wait for the clients to come through the door. They followed the clients.’ That is the same strategy followed by City of London law firms that have followed clients’ work around the world.


On the same basis, Aberdeen firms Paull & Williamson and Ledingham Chalmers have offices in Azerbaijan, as they follow the clients developed from the local North Sea oil business over three decades or more. Ledingham also has an outpost in the Falkland Islands. Back in 2003, meanwhile, Glasgow firm Golds unusually opened an office in Manchester to boost its property and banking practices. It said the move was motivated by client demand to provide English legal services, while Manchester had a good recruitment market and was not so far from the HQ.


So will more English firms start going in the other direction by opening Scottish offices? ‘We’re delighted to have them,’ Mr Mill says. ‘If they put our firms under pressure to raise the bar, then the more the merrier.’


Stephen Ward is a freelance journalist