By Rupert White


Legal professionals fear that alternative business structures (ABSs) - a key element of the Legal Services Bill - will compromise the quality of legal advice, according to a report to be published this week.



The report, researched by Intendance and published by Sweet & Maxwell, includes a poll of high-ranking private practice lawyers, barristers, in-house counsel and non-lawyer managers.



It found that nearly three-quarters of those questioned agreed that 'the quality of legal advice dispensed by legal professionals working under ABSs could be compromised'.



Half of the respondents did not think the coming reforms would encourage their own organisation to become an ABS.



The report also found that larger firms are most likely not as prepared for the reforms as 'smaller, ambitious commercial firms', which can raise capital to hire 'rainmakers' and acquire other complementary practices and firms.



Law Society President Fiona Woolf disagreed with the findings. 'ABSs will be regulated by legal regulators in the same way as all other law firms,' she said. 'Consequently, we see no reason why the quality of the legal advice should be compromised.'



But Lord Phillips of Sudbury, a solicitor and leading opponent of ABSs, said that the quality of services would undoubtedly be compromised.



'There's still a sizeable part of the high street profession that has strong sense of justice for the community as a whole. The ethos of banks and retailers will be as ruthlessly bottom-line as everything else they do. People's needs aren't very often neatly packaged. If they get a very difficult case, they just won't handle it.'



It is high street firms that will be worst hit, according to the report. There was general agreement among respondents that the introduction of ABSs is likely to make the profession more competitive and that the proposed 'fitness to own' test is unlikely to prevent unsuitable ownership.



Law firm management consultant Andrew Otterburn said: 'It is certainly hard to see how the reforms will improve the quality of legal services, and because their whole focus was on the consumer and government's desire to make legal services cheaper and easier to buy, it is highly likely that quality will be compromised.'



However, half the solicitors in the survey said they might be interested in adopting an ABS structure and 37% did not rule out seeking outside shareholders.