AS BIRMINGHAM'S INDUSTRY ALTERS, THE CITY'S LAW FIRMS FIND BOTH NEW AND OLD CLIENTS NEAR AT HAND -- AND AS FAR AFIELD AS LONDON AND BRUSSELS.

TODAY BIRMINGHAM, TOMORROW THE WORLD? ANNE MIZZI INVESTIGATESBirmingham.

UK's Berlin, if the professional community here has anything to do with it.

'I am expecting to rule the Third Reich from here,' jokes Eversheds' Birmingham senior partner and commercial property lawyer Adrian Bland.Like Berlin, Birmingham is being rebuilt.

It is a city that has been much maligned as a concrete jungle.

But the building work that is going on all over the city anticipates a spanking new image for the heart of the Midlands' capital.Birmingham's top law firms are dotted around the old cathedral square, which is also being dug up.

Birmingham firms Martineau Johnson and Wragge & Co have a particularly good view of the exhuming of plague victims' graves, although Wragges seems to have escaped the vibrations, which gently shake lawyers at Martineaus.Birmingham has a long industrial history an the decline of manufacturing and the car industry has hit the local economy hard, although it would still be difficult for any law firm here to ignore the local client base.The Wilkes Partnership is celebrating a win of more Avis work, and Rover and BMW still provide substantial work for Birmingham firms.

But there is a change.Technology companies such as 3i are coming to town, hiring top firm Wragges in place of Lee Crowder, and professional services are growing.Wragges partner Richard Haywood says: 'Manufacturing has taken a battering, with the high value of the pound, but we still act for manufacturers as well.'And Hammond Suddards Edge is stepping up local pitch activity after three years absence from the scene as Edge Ellison got into shape for merger.

After its June wedding to national firm Hammond Suddards, partner Paul Cliff says the firm is seeking to win Midlands-based clients, which still count for a significant part of the local economy.

He argues: 'It is still a challenge for Birmingham law firms to get more local companies to take their advice from Birmingham firms.'But the squeeze on industry has had a knock-on effect on the professional advisory community.

DLA's Birmingham managing partner, Chris Rawstron, argues: 'The local manufacturing base was not big enough.

Firms had to look to London and internationally.

That will continue.

At the same time the professional community is becoming an increasingly important part of the local economy.

Birmingham constantly reinvents itself.

It is attracting much better quality recruits and the city has made a large investment in its infrastructure.'Hammonds' consultant John James, who will head the College of Law's new Birmingham branch when it opens next year (see interview), takes a stark view: 'Birmingham is a city that is driven by the professions,' he says.Mr James is also chief executive of Birmingham Forward, an organisation that promotes the area's 90,000 financial and advisory employees.

And anyone who is anyone in the Birmingham legal community is involved in the group.

For example, Mr Bland is taking over as chairman next year and Pinsent Curtis partner John Pratt is chairman of its education and learning committee.'One office' Birmingham firms Wragges and Martineaus have both opened London offices in recent months, reflecting a shift in emphasis for Birmingham-based firms.

But both firms insist the offices are limited.Martineaus hired Edge partner Helen Leeson to lead a London office, which opened in August.

She brought some Lloyds TSB work with her, to add to Martineau's existing Lloyds TSB files.

Martineau's managing partner David Gwyther says: 'We see ourselves as one firm operating from two offices.

London is not going to affect the overall strategy and ethos.'Full service corporate law firm Martineaus has, like Hammonds and Shakespeares, gone for a sector-based approach in recent years.

But Martineaus also restructured its equity partnership in December, introducing fixed share partnerships, which reduced the number of equity partners from 23 to 15.

Equity partners now bill 2,500 hours a year, while fixed share partners have a 2,000 billable hours target.

This was a big achievement for the firm because of its executive board's well-known unanimity policy.Wragges now has offices in Brussels and London, following a merger with intellectual property practice Needham & Grant.

Rivals are watching the firm keenly, citing it as the most likely contender for a US merger given its location and high profitability, although Pinsent Curtis has also been linked with US names.Mr Haywood insists Wragges has no plans to go 'gung ho' in the capital: 'We have no current plans to go full service in London.

We may add on if a business case develops and clients want us to.'These and other firms increasingly looking outside Birmingham for new business.

For example, 65% of Wragges' work now comes from outside Birmingham and it is attracting national clients such as British Airways.National firms DLA, Eversheds, Hammonds and Pinsents are all in the market for corporate management buy-out and buy-in work, but there are some fundamental differences in their strategies.

For example, DLA has one profit centre, while Eversheds shares profits locally.Like Hammonds, DLA is ploughing cash into building its Birmingham office, determined to carve itself a larger market share and hopes to number 350 people by 2003.

But Mr Rawstron, is reluctant to assess how far the firm has broken in to the market: 'It depends on how you define "cracked it", 'he says: 'We are not the same size as Wragge & Co, but we are a different proposition to most of the other firms in Birmingham.

The nearest firm strategically is Eversheds, therefore we are part of something very different because we are an international and national firm.

We don't have to be big in Birmingham tobe pre-eminent.'Birmingham firms have been chipping away at the mergers and acquisitions market, attracting corporate clients by having lower charge-out rates than those of the London firms.Midlands partners command hourly rates of between £80 and £300, compared with £100 to £500 in London.

But there is still little likelihood of the pre-eminent Birmingham corporate finance firms breaking London's magic circle monopoly on lucrative merchant bank work.

London firms are still the first choice for capital markets work and mega-corporate transactions, such as hostile take-overs.

'I don't think you will find many magic circle firms looking over their shoulders at the Birmingham firms,' says a wry Mr Pratt.

But Mr Bland is more optimistic on the corporate front, arguing that although merchant banks continue to hand work to 'pet firms', companies are increasingly questioning whether they need to go to a magic circle firm for a particular job.Birmingham is held back by its lack of a strong investment bank community, argues DLA's Chris Rawstron, and many lawyers agree the best thing for Birmingham would be for one to set up here.In addition, London salary rises earlier this year have increased pressure on Birmingham firms to recruit and retain.

But Shakespeares managing partner, Andrew Argyle, insists it is two-way traffic.

Lawyers might have to take a cut in pay, he argues, but overheads are cheaper and there is a life-style and quality of work pay-off, coupled with good promotion prospects at some of the smaller firms.

Both Shakespeares and the Wilkes Partnership have slimmed down to improve the partnership track.The trouble is, it is a two-way flow.

'It swings and roundabouts,' says Mr Rawstron: 'As many people as Birmingham gains from London, it loses to London because a lot of the young lawyers head down there.'Compared with London, the Birmingham legal community is much closer, and packed in to a tight area.

The result is a friendly but competitive scene.'People can generally have a bit of a laugh about [the rivalry],' says Mr Bland; 'I can have a laugh with [Wragges partners] Quentin Poole and John Crabtree.'Mr Argyle agrees: 'There is a lot of competition between the firms.

There is poaching and headhunting, but we all know what the rules are.'On that front, Hammond Suddards Edge has caused a stir with its campaign to hire 100-odd lawyers, to rep lace lawyers shed in the course of its merger.

It has retained headhunters to bring in the partners to which it is offering 'top whack', while it is hoped that advertisements will bring in the assistants.Rivals are wondering where Hammonds expects all these lawyers to come from.

'I got an e-mail this morning,' says one partner: 'It's got to the stage where people are wondering what's wrong with them if they haven't had an approach.'Mr Cliff is keen to emphasise that the merged firm is serious about growing in Birmingham.

'I genuinely believe that Birmingham was just as important to them as London.

Our commitment is to grow in Birmingham,' he says.There is a strong sense of solidarity, despite the rivalry.

When Martineaus was conflicted out of Pheonix's bid for BMW-owned Rover, 'we were pleased to see Eversheds brought it home', says senior partner, Michael Shepherd.And the firm's managing partner David Gwyther drove home the point: 'It was important that it stayed in Birmingham.'FLOURISHING LAW SOCIETY REFLECTS GROWTH IN CITY'S LEGAL FIELD, BY ANNE MIZZIThe Birmingham Law Society is one of the most active local law societies in England.Its president is commercial litigation partner Jayne Willetts of Hammond Suddards Edge.

She is well known among Birmingham's jet-set at the top firms, and was the first woman to qualify as a solicitor-advocate, the first to chair the National Young Solicitors Group (YSG), and the first to become president of the local law society.Under her leadership, BLS has flourished.

Ms Willetts says the influence of women has been particularly strong in Birmingham, listing Eversheds's Birmingham managing partner Meg Heppel and mercantile judge Caroline Alton among her contemporaries.This may seem progressive, but women have been represented in the law society since 1923, when Mary Pickup was admitted, only four years after women were first allowed into the profession.The BLS is now pushing the boundaries of the virtual world.

It is developing a database for referral work and an integrated website with hyperlinks.It already boasts the largest lending law library in the UK, a recruitment service, and a graduate database.

And activities include a continuing education programme for fee earners and support staff.

It names lobbying and links with the Birmingham YSG and Trainee Solicitors Group as key functions.Ms Willetts says: 'Birmingham is best for quality of work and for quality of life.

It is unrivalled as a legal centre.

The Birmingham Law Society is the largest and most proactive local society in the country.

'It seems that the law society has kept pace with the growth of Birmingham itself, since its foundation in 1918.

More than one million people live in the city, 4,000 of whom are solicitors.

Five of the country's top 50 law firms are based in Birmingham.

To reflect this burgeoning market, membership of the law society has doubled in the past 10 years to 2,200 members.Ms Willetts encourages young solicitors to become active members of the 'unique' Birmingham legal world in which they will find healthy rivalry between firms but also friendly co-operation.THE ICONOCLASTIC JOHN JAMES WILL BE THE HEAD OF THE COLLEGE OF LAW'S NEW BIRMINGHAM BRANCH -- AND HE HAS BIG PLANS, FINDS JONATHAN AMESIf anyone is 'Mr Birmingham' in the legal world then it must be John James.

A long affiliation with Edge Ellison has evolved into consultancy with the post-merger Hammond Suddards Edge.

For the last few years he has been the chief executive of Birmingham Forward, the body that promotes Britain's se cond city as a centre of commerce.

Indeed, the much-maligned midlands metropolis has no greater cheerleader than the 55-year-old solicitor -- no-one was more disappointed than he when the government gave the nod to Greenwich in London over Birmingham for the main millennium celebrations.Now Mr James is to take up the reins as the head of the College of Law's new Birmingham branch.

It is a bold move for all concerned with reputations on the line if plans go wrong.

The college is throwing £7 million at the project, effectively building a branch from the ground up, staffing it and getting 400 students in place by September 2001.

And the endeavour has not been without its hiccups.

The first choice site was reliant on a European grant, which fell through when the government's West Midlands office failed to support the plan.

The college is now financing the scheme -- which has since found a new venue -- entirely out of its own pocket.

There have also been suggestions that other educational institutions in the city, which are currently offering the legal practice course, were less than thrilled at the idea of the college steaming in to heat up the competition.For Mr James, too, there are risks.

Although he has a wide experience of commercial life and is the chairman of a further education college, he has never had direct responsibility for the running of an educational establishment.

'I'm not trained as an educationalist, so I've got a lot to learn,' he acknowledges candidly.

'The main reason I was chosen to do this job is because I am close to the legal community in Birmingham and I am a natural marketeer.

At the moment we are selling a virtual college.

There is no building apart from an empty shell.

There is no staff in place.

There is just me and a marketing team.'But clearly both Mr James and the college's overall chief executive, Nigel Savage, anticipate great things in a relatively short time.

Indeed, Mr James is already describing the Birmingham project as evolving quickly into the flagship branch of the college, a process that might ruffle a few feathers in London and Guildford.

He explains: 'The one advantage that Birmingham will have over the other branches is that it sits cheek by jowl with the law firms that it is seeking to serve.

Store Street in London might be relatively close to the City but there isn't the nexus that will exist between the college in Birmingham and the Wragges, the Eversheds, the Hammonds, the DLAs and the Martineaus.

They will be eight minutes walk away.'The law firms are desperately keen to support the college in Birmingham.

That is a unique selling point that none of the other branches can offer.

Chester has only a distant link with Manchester and likewise York with Leeds.

And Nottingham Law School -- one of our main competitors -- cannot offer that.

The law firms in Birmingham are going to be actively involved in the programmes we deliver, particularly on the corporate side.

The kind of corporate deals being done in Birmingham now are exactly the same as those being done in London, they might be a touch smaller but they are as sophisticated and they are becoming as commonplace.'Ironically, the college maintains there was a benefit to the deal involving the first site falling through.

The new site is in the heart of Birmingham's significant ethnic minority community, and Mr James has big plans for the launch of a college-based pro bono initiative which will serve that sector of the city's population.'Free advice will be available to the community, provided through the students but supervised by the college staff.

It will be a good training programme for our students, but more importantly it will be something that the community wouldn't otherwise have access to.'New technology and the delivery of legal services via IT is also an area Mr James would like to see addressed by the legal practice course.

If anyone can make it happen then odds are that it would be Mr Birmingham.