The demise of the sole practitioner

As I previously predicted, the number of sole practitioner firms in England and Wales is falling fast. Since October 2009, they’ve fallen by 18% from 4,095 to 3,377

At the same time, there’s been a dip in the amount of partnership firms, but a rise in the number of incorporated solicitor companies and LLPs.

Surprisingly, the overall number of firms of around 11,000 has stayed fairly static over the last three years. But I expect that smaller firms will have to merge in the future to survive. Legal aid for most areas of family law is disappearing as from April 2013 and pressure on other areas of publicly-funded law is likely to increase.

How the Co-operative’s legal services and other such organisations are going to eat into the traditional high street business is not known at the moment. But I’ve written before about the investment that’s being made by the Co-op, and they are clearly serious about this being a long term venture.

At the same time, Co-op’s pricing structure is not cheap. Certainly for family law. Some of their pricing is much more than I might expect to achieve in similar circumstances.

For example, for £660 they’ll prepare a Cohabitation Agreement where all the terms are agreed between the parties. There’s no meeting between the Co-op’s solicitor and the client. All the client is doing is setting out on a pre-printed form exactly what is agreed. Drawing up documents where everything is agreed is simple. It’s reaching the point of agreement that’s expensive. Firms like the Co-op are limiting the amount of work that they will do within their fixed price structure.

What’s also noticeable about the Co-op’s price list is that the cost of ‘experts’ is on top of the advertised fixed price. The total cost of financial proceedings going through all the stages is between £6,000 and £7,600 plus the cost of any expert.

What the Co-op will do is send out a lot of the work, which is usually done by solicitors, to barristers. The barristers will charge for opinions and preparation for hearings in addition to the advertised fixed costs. In reality, the Co-op is going to end up being a post box between the client and the barrister, with the client being charged for all the additional work the barrister has to do. The Co-op also has another fixed cost of £600 for instructing the barrister, which is on top of the fixed costs mentioned above.

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