Moving on up

When law firms move or expand their office space, legal advice is needed for the property transactions.

Should firms seek outside advice or go it alone? Anne Mizzi investigates

A lawyer who acts for himself may well have a fool for a client, but this has not stopped some lawyers from advising their own when they move house.

For smaller transactions, many firms are still happy to use their own property department.

But on the larger-scale deals, many make the tricky decision to pass the foolish client on to their rivals.Reflecting the current buoyant legal market, many firms are on the move or expanding.

The likes of Nabarro Nathanson and Dibb Lupton Alsop have just moved into space-age London offices, as has Pinsent Curtis in Leeds.

Freshfields is expanding into more office space near its Fleet Street HQ.

Withers is on the move and Lewis Silkin is leaving Westminster to take on Withers' old premises.

Simmons & Simmons is to move into the new City landmark City Point when it is finished, and Slaughter and May and Rowe & Maw are two other top firms itching to move home.These are big deals - the kind of large-scale property transactions most lawyers would give their eye teeth for.

So why are the vast majority of law firms handing the work to rivals? Harold Paisner, senior partner of Paisner & Co, and Charles Pollock of Simmons & Simmons are not alone when they say it is because there is some truth in the saying about the foolish client.

Paisner & Co moved into its current premises in 1979 and is now looking to move into the 21st century, and is hunting for a pre-let of 75,000 to 85,000 square feet.

Paisners has drawn up a shortlist of possible legal advisers.

The firm has not yet chosen its outside lawyers yet, but Mr Paisner says: 'We will obviously use outside professional advice.' So the law firm is now set to become a client.

It will experience the transaction as a consumer of legal services.

Like other firms in this position, Paisners has formed a committee to act as the client, made up of the usual suspects: the managing partner, the senior partner and the head of property.This is one beauty parade Paisners' property department was destined to lose.

Mr Paisner was determined from the outset to go outside for legal advice.

He explains: 'You need objective advice if you are spending a lot of money on a major lease which may have very onerous obligations.

We want the best possible legal advice.' He suggests it is possible to get too involved in the deal: 'If you are a divorce lawyer and you want to get a divorce, it is not such a good idea to act for yourself.'Martin Wright, a property partner at Ashurst Morris Crisp, uses a different analogy: 'A surgeon will never operate on a member of their family, but a GP wouldn't have a problem with sticking an Elastoplast on their child.'Mr Wright says the decision to go outside for advice depends on the nature and the size of the deal: 'With a major move for future pre-letting, it does make sense to have an external pair of eyes that will have a cold, disinterested view of the transaction.'Ashurst Morris Crisp was the first port of call for Linklaters on its move to Silk Street, as well as for Simmons' move to City Point.

And Ashursts is now planning to move two of its departments across the City, to Broadgate West, a move that Ashursts partner Martin Wright describes as 'infinitely easier'.

Mr Wright says Simmons' move was more difficult, as pre-lets cause more problems than straightforward transfers of ownership.But it is not just the pre-lets that complicate matters when lawyers move en masse.

Martin Wright admits the problem: 'Lawyers are natural negotiators.

They will go on and on.

You have to advise your clients: That is good enough now.'David Wright, Nabarro Nathanson's new head of property, says: 'It's always a danger that someone would try to over-negotiate.

That's a danger in any transaction.' The firm used Clifford Chance for its move from Green Park to Holborn in November last year.But it is not just solicitors that can delay decisions with chat.

Martin Wright says: 'It's a case of too many cooks spoiling the broth.

Barristers are just as bad.' He should know.

Mr Wright advised on the biggest chambers move - Brick Court Chambers to Essex Street.

Simmons' Charles Pollock argues the other side: 'It's quite difficult being a client.

It is a full-time job.' Simmons is instructing Ashursts on its move on Linklaters' recommendation.City Point was the first time Simmons had gone outside for property advice.

When the firm had sublet in the past to US firm Weil Gotshal & Manges, and had taken space in one of Linklaters' buildings, Simmons did the work itself, as it will probably do when it sub-lets part of City Point to another law firm.

But because of the sheer magnitude of the City Point transaction, Simmons decided it would be good practice to go to outside.

Like good lawyers, they agreed rates in advance.His advice to any law firm considering a large scale move is: 'Don't try to do it yourself.

You will go mad trying to find the time.'But it can be done.

Rupert Jones, a former partner at US firm Sonnenscheins, ended up advising in-house when the firm shut down its London office.

He joined Buchanan Ingersoll as a partner, completing the deal internally.

He says it was a 'surreal position' to be in.

He says: 'You can do it, but you have to have a client.' On the Buchanan Ingersoll deal, the firm's London head of administration and its US-based director of finance remained the clients.

Mr Jones emphasises: 'You need to have the relationship, to debate and discuss.

There will always be a client.'But Mr Jones is no stranger to advising his own firm.

He was on the Allen & Overy team advising on Allen & Overy's move to New Change.

He denies that advising lawyers can necessarily turn into a talking shop: 'Like many clients, they have no interest in the detail of property law.

They just want the deal done.

'You just treat it as a normal client relationship.

Instead of a letter of advice, you can send an internal memo or e-mail, but you have the same sort of relationships [as you would if you were] acting for a major client which is channelled through an in-house lawyer.'Norwich firm Fosters chose to advise itself on its recent move to refurbished premises.

Like Buchanan Ingersoll, Fosters drew a line between lawyer and client.

Managing partner Andrew Saul says: 'We were pretty good at sticking to our own areas.

We felt it important to preserve that distinction during the months of negotiation.'He said the key is to have a structured management board to make decisions.

He acknowledges that this might be easier in a partnership of ten with a four-strong management board than in a firm with more than 100 partners.As the most profitable UK firm, it has often been commented on with surprise that Slaughter and May has remained in pretty basic quarters while its rivals have encased themselves in whole ecosystems which are light years ahead.

But things are changing.

Slaughters may not be opening a network of foreign offices, but it is opening somewhere - a new London office in January 2002.

This might seem out of character, but the execution of the deal is characteristically Slaughters.

Property partner David Beales is advising his own partnership and has looked after the firm's property affairs for ten years.

He sounds vaguely shocked at the idea of using another firm: 'I don't think it would occur to us.

It's a very un-Slaughter and May thing to do.

My partners would expect me to do it.' Mr Beales is cool about the arrangement.

He explains: 'Part of being their lawyer is that you go through their agonies with them.

You hold their hands and tell them what they need to do.

It's not that different doing it yourself.' And he says there is an upside: 'None of them know anything about property, so they do what they are told.' Dianna Parker, senior partner at Withers, hired Mr Beales to advise on the firm's new office: 'It was largely a question of time.

Our property department is quite stretched.

The extent of the transaction would have been quite a burden.'So outsourcing the work has another benefit - it leaves the firm's head of property free to focus on fee-earning.

Mr Paisner puts it bluntly: 'We want our own people to earn fees from clients.'What effect do spanking new premises have on the client? In-house lawyers frequently say that when they engage with outside firms they do not like to see too opulent an office - because they know where the money comes from.

Withers is not the only firm that has got wise to the problem.

Ms Parker says: 'It shouldn't be too glitzy and glamorous if it is a space that they are paying for.'Mr Pollock agrees, explaining that Simmons has opted for a very visible 'destination' building.

'It is tall and unusual.

You will notice it.

But we are taking great care to make sure that it is not too ritzy.

It's not going to be merchant bank-type flash.

We have to be aware of what our clients think.

On the other hand, we have to move to new buildings, and there isn't a vast amount of choice.'It is still early days for Mr Paisner, but he knows what he wants: 'The days you could see clients in Dickensian offices are long gone.

You don't want anything lush, but you want something modern and smart, but you don't want to go over the top.

You don't want the equivalent of a bathroom with gold taps.'Law firm moves are not simply born from the necessity of finding alternative accommodation when a lease runs out.

Firms also want to upgrade.

They want to reflect the nature of the practice and to get all their lawyers under one roof.

Law firms are becoming big business, so they need big premises to expand into.

But it would be foolish to think there is only one way to skin a cat.