In the first of a monthly series of regional profiles, Jon Robins examines the thriving legal markets in Nottingham, Leicester and Derby

According to a recent survey, small and medium-sized law firms in the midlands are struggling to maintain competitive advantage (see [2005] Gazette, 24 November 6). But partners in the east midlands – where intense competition is rife between the three centres of Nottingham, Derby and Leicester – paint a different picture.


Talking about the east midlands as a region, or even one single legal market, can be a sensitive issue. Each of those three main cities are ‘fiercely independent’, observes one local senior partner, before adding quickly: ‘Actually, that’s a bit of an understatement.’


He then refers to the recent brouhaha over the controversial re-branding of the East Midlands Airport, which became Nottingham-East Midlands Airport after market research revealed that people were unsure where the region actually was, other than somewhere east of the west midlands. Much to the annoyance of the other two cities, it seems that the international marketing appeal of Robin Hood won over evidence that the airport is actually four miles closer to Derby than Nottingham, and has a Leicestershire postcode.



Freeth Cartwright moved into new head office premises in Nottingham two years ago. It had considered a centralised regional presence, but considered it was important to retain its local touch. ‘We could have opened an office on junction 23 on the M1 [where the airport is], but we are of the view that if you’re going to attract new business locally, and look after individual clients, then you need to be in the individual cities,’ says chief executive Peter Smith.


There are only a handful of firms with representation in the three principal cities, and Freeth Cartwright is one of them. ‘I would regard the area as three different markets,’ Mr Smith says. ‘Each city has its own identity, and each is very keen to promote that identity, which means there is an element of rivalry between cities. For example, in Leicester, they would not welcome the fact that Nottingham is identified as the strongest market.’ The firm’s turnover breaks down as follows: 80% comes from Nottingham and 10% from both Leicester and Derby each. Despite that, he adds: ‘I wouldn’t want to make out that Nottingham has a stronger market because, if anyone is reading this in Leicester and Derby, they wouldn’t like that very much.’


Nelsons also has office in all three. ‘The Nottingham to Derby divide is only 16 miles, and if the traffic is clear, it’s a 25-minute run between them,’ reflects chief executive Tim Hastings. ‘If you’re comparing that with London, Birmingham or Manchester, it can take longer to move between offices on other sides of those cities. But there is a very distinct appreciation within all three cities of the region where they belong. Each city, regionally and economically, competes with the other.’


Nelsons went from its origins as a small general high street practice, set up in Nottingham in 1983, to a regional player in two dramatic leaps. In 2000, the firm merged three Leicester-based firms – Ironsides, Tollers and Greene Deavin – to bolt on a 14-partner Leicester practice to its existing operation. The previous year Nelsons picked up two other firms in the region – Derby-based Gadsbys and personal injury practice Alfred Sevier & Son.


Mr Hastings explains the merger frenzy as a response to a wave of changes throughout the profession, ‘some of them real, some of them feared’, rather than within the local market. In particular, he mentions the legal aid reforms, the advent of conditional fees and concerns about consolidation among conveyancers. ‘My take on the legal market at the time was one of fairly profound polarisation,’ he recalls. ‘The small were staying very small, the medium firms in some cases were hanging on, and others weren’t and, increasingly, the landscape was dominated by a handful of larger firms in each of the three cities.’


So what is the business case for law firms having representation throughout the region? It is ‘a very strong region, and not unwealthy, with a solid manufacturing base’, replies David Williams, a commercial partner in Geldards (the firm has just changed its name from Edwards Geldard and converted to a limited liability partnership), which has a presence in Nottingham and Derby.


He insists that the economic argument is compelling but acknowledges ‘a perception that professional services are best done out of Birmingham’. Mr Williams argues that the big regional players, with the exception of Eversheds, have overlooked the region – at least in terms of having a physical presence. He contends that while the national players such as DLA, Pinsents, Wragge & Co et al are in pursuit of the top-350 companies, they are wrong not to have a stronger focus on the region.


‘There is a huge amount of business outside the top 350, a monster amount,’ he says. ‘You are in danger if you run away from those companies, and you aren’t seen on their patch.’ Geldards initially set up in the region in the late 1980s to service a major client, William Holdings, a FTSE-100 company which demerged. Mr Williamson says: ‘The top-350 companies might want a City firm to do the top-end work, but they want a provincial firm to do the 80% of stuff that doesn’t need to be done at City rates… Our argument is that firms are going to miss out on the local clients by going to the west midlands and Birmingham. They are also going to become more expensive and lose out on the London work that PLCs might want a firm like us to do.’


Howes Percival has a different geographical focus with offices in Northampton, Leicester and Milton Keynes, which it includes within the east midlands. ‘It’s right on the southside of the east midlands, if it’s in the area at all,’ acknowledges Brandon Ransley, the office’s managing partner. The firm has 196 staff in the east midlands, and its turnover is £13 million, with Milton Keynes contributing £6 million.


According to Mr Ransley, many of their new recruits are former City lawyers. ‘They are fed up with the commute and want to join a corporate and commercial firm with the necessary expertise and infrastructure,’ he says. ‘We have made significant inroads into their clients. Where they have been charged £400, they can come to us and it’s £250 to £275 an hour. They get the same service at two-thirds of the price.’


Mr Williams also reckons the location is a draw for City lawyers looking for some kind of decent quality of life, with recent new recruits coming from the likes of Eversheds and City firms Travers Smith and SJ Berwin. ‘They get to the stage of wanting to have children, but they are still interested in the quality of work, and they like the idea of being able to live in a nice country cottage with sheep at the back door,’ he says. ‘It sounds a bit twee, but it works.’


Many east midlands firms with a strong commercial focus claim to be thriving. Howes Percival has increased its turnover over the last three years by 42% and new clients over the past 12 months include hotel group Corus, Kia Motors, National Geographic Channel and Bentley Motors.


One lawyer describes Derby as the smaller, ‘less confident’, city. So for a firm like Geldards, what does having an office there bring to the firm as opposed to the de facto capital of the region? Mr Williams acknowledges that there is less competition in the local legal market, which has given their firm an opportunity to do ‘a lot, lot better in market-share terms’. He adds: ‘There are some really great industries here – for example, Rolls- Royce and Toyota, and it remains the centre of the rail industry in the UK – and that is a tremendous group of clients to have.’


As far as Nottingham goes, the biggest firm remains the only truly national player – Eversheds. Some have claimed that its commitment to the region has been flagging as a consequence of strategic plans to bring the management of the Birmingham and Nottingham offices under the control of its Cardiff office to create a wider central region. In June 2002, the firm shut down its Derby office.


So what is the significance of the region to Eversheds’ national plan? ‘It is an essential part,’ insists David Wild, senior office partner in Nottingham. ‘We’re doing good-quality work here and we have a major part as a regional player and as part of the firm’s bigger picture.’ He points out that there are 100 fee-earners in Nottingham and 18 partners.


However, the firm, which has had a connection with the city since 1838, claims to act for ‘most of the local PLCs’ in the region, and its client list includes credit reference company Experian, Boots, Nottingham Trent University, Derby University, De Montfort University in Leicester, Alliance & Leicester and Rolls-Royce. ‘Although we play a full part in the local region, we are different from the other firms in that we do a significant amount of international work, and, in particular, act for local businesses working overseas,’ says Mr Wild. ‘There is no other firm in the region which can do that and is comparable. There’s clear water between us and anyone else on PLC work.’


A feature of the Nottingham market, and throughout the wider region, is the disparity that exists between those handful of firms that have critical mass with commercial law clout and the larger number of small firms.


‘There is probably something of a glass ceiling in terms of the commercial work in Nottingham,’ reckons Brian Smith, managing partner of Browne Jacobson, which is the firm with most lawyers on the ground. Some 380 of its 500 staff are based in the city, with the rest in its Birmingham office. The firm claims 43% growth in turnover over the past four years, and has taken on new clients such as the Youth Hostels Association and the fruit machine company Leisure Link over the past year.


‘We believe that we can service the whole of the midlands very effectively from those two centres,’ says Mr Smith. ‘We do not need a local presence. For example, the work that we do for the East Midlands Development Agency, we do across the region without the need to be located in Leicester, Derby, Lincoln or Northampton. We are very much a big midlands practice with national clients, rather than an inward-looking local practice. It works well.’


He is also happy to have competition from a powerhouse like Eversheds.


‘It puts a stamp on Nottingham as a commercial centre, and I would not like to see any major law firm pull out.’


Berryman (which has just changed its name from Berryman Shacklock) is the largest single-site law firm in Nottingham and is also reporting a good year. The firm’s turnover has grown by 53% over the past three years, and it employs around 120 staff. It says it has completed 40 commercial deals at an aggregate value of more than £140 million last year.


‘There is undoubtedly more heavyweight commercial work done in Nottingham than there is in Leicester and Derby,’ reflects managing partner Andy Matthews. ‘A couple of years ago, the view seemed to be that a lot of the legal work was being dragged away towards Birmingham. But I suspect that it is not happening as much now, as people are beginning to realise that there are good professionals in Nottingham. It’s a very competitive market.’


Jon Robins is a freelance journalist