Your Prison Cell Awaits....

                                                                             


Occasionally, at the end of a criminal trial, when a prison sentence has been handed down, the Judge will defer the start of the sentence for a couple of weeks to allow the Defendant to get his personal  affairs in order. I remember that happening to a solicitors clerk in a practice not far from where I was brought up in the North West of England who along with others in the practice had been sentenced to a couple of years for 'Green Form' fraud. I recall thinking how awful that must be - being allowed to walk out of the court room to go home, knowing that you had a 2 year sentence waiting to start in 2 weeks time.

It's been a similar situation for RTA lawyers over the past however many months. They have known that a prison sentence awaits them on April 1 2013, but as it all still seemed a life time away, things carried on as normal. Even when it became certain that referral fees were going to be banned - bluster and bravado ( "oh it will be business as usual, ha ha.") More recently the laugh has become a nervous one and then on Monday 19th November, the laughter stopped altogether -the fixed fee under the Portal slashed from £1200.00 to £500.00 (unless the Law Society who are 'raising concerns' can weave some magic - ok, you can all start sniggering again).

Why there isn't even enough left in the pot to pay a dodgy referral fee!

As if that wasn't bad enough, those who suddenly thought that overnight they could become super EL/PL lawyers, woke up to find that that was being dragged into the whole sorry scheme too, albeit at slightly better rates (but not significant enough to get the cheque book out for a down payment on that new Porsche).

It's been interesting, hearing all the news on the grapevine about solicitors and CMC's who have supposedly found unique ways around the referral fee ban with opinions from Rumpole QC confirming that they have a cast iron scheme. Pray, do tell, so we can all have a good laugh. Goodness knows we need one. In any event could Counsel please advise which 'pot of gold' the cast iron 'referral fee by any other name' is going to come from?

I may be mad, but I still believe that this is a time of opportunity for some and by that I don't just mean for the big boys and girls. Firms will have to re-structure, no doubt about that. There will be casualties. CMC's who have nothing to offer other than buying in and selling on claims will disappear, go into PPI or become debt management companies. CMC's that are in reality old fashioned Credit Hire companies by any other name, will still be able to make a living from providing hire facilities (yes I know that there is the OFT thing hovering around, but let's deal with that as/if/when it comes around - we've got enough to deal with at the moment). Solicitors, cosy up to them and network with others. There is nothing wrong with you working in an informal relationship as long as you don't share fees and don't pay referral fees and maintain a professional approach, is there? The old fashioned 'good service' quality might come to the fore in terms of selling yourselves (not literally).

...and start marketing like you never have before - network - think outside the box. On the technical side of things there are legitimate ways to get matters out of the Portal on many claims. Be sharper than the opposition and competitors in the handling of your claims. Do you have a lot of claims that include credit hire charges as part of the Special Damages claim? Are you still allowing most of those claims to stay in the Portal? If so why?

So, PI solicitors, the future is difficult but for those prepared to roll their sleeves up, there is a future. RTA/PI lawyers have proved in the past they are a resilient lot. Now is the time to show that quality again.

If you need some help not just with marketing your firm but with advice on re-structuring and how to move forward in 2013 and beyond please feel free to email me at carl@carlwaring.com Unlike many legal marketing experts, I have the experience not only of 28 years specialising in RTA/PI work, but of having built up my own practice from scratch and turning it into a successful and thriving business. I know how difficult it is sometimes to see the wood from the trees when you are running a practice and I now have the benefit of having had the blinkers taken from me, having sold my practice some years ago.

That prison cell does not have to have your name on it.....

Yawn Yawn. Jackson and all that...

I've been a little quiet recently in terms of tweeting and blogging on LASPO, Jackson and all that. To be honest I am a bit weary of it all...all the speculation and jaw jawing, of listening to possible ways of getting round the ban (not supposed to be looking at ways of doing that are we; thought we were just meant to comply?). Of course we all still await the definitive definition from the SRA as to what consitutes a 'referral fee'.

A formal consultation process conducted by the SRA started on the 23rd October and will end on the 18th December. There is to be an 'SRA Referrals Symposium' (to be held at the Royal Albert Hall?). Code changes are to be approved by the SRA Board on the 23rd January 2013, changes to the Regulatory Framework will be approved by the LSB mid February 2012, final version published 'early March 2013' and Implementation of the ban - April 2013.

Reading about the Consultation on the SRA website is making my contact lensed eyes water, so you can check it out for yourselves at www.sra.org.uk/sra/consultations/referral-fees-2012.page if you like. It might make your eyes water too.

I hear it being said by many, and indeed to avoid being accused of hypocrisy, I have also sounded off to this effect previously, 'how can we possibly plan for the future when nothing is written in stone?'. I still believe that to be true for instance in the case, for example of what the fixed fee under the RTA portal will come down to  (I believe that at the recent MASS conference many delegates were saying that they believed that the fee will not come down to the oft quoted figure of £400, but is more likely to be fixed at double that).

However, the one thing that is certain is that referral fees will be banned, that is that LASPO 2012 as implemented in April 2013 will prohibit the 'payment and receipt of referral fees in personal injury cases'. I do not see that the SRA is going to provide much more in the way of a deeper definition. Indeed it has already said that it does not intend to provide a blue print for firms. It will rely on self-regulation to a great extent and to my mind it will boil down to this - at the moment Mr/Mrs/Ms RTA/PI Solicitor you receive quite a bit/some/an awful lot of your work by paying a referral fee to a CMC/Insurance broker or to some other organisation to receive a personal injury claim - ie you pay £X for a PI or you pay £XXX to receive 20 claims a month or whatever. After the first of April that will not be allowed and you can dress it up in fancy ways, but it will still be banned, and you know that it will be banned, so don't do it. If you do do it, well first of all, remember that you are under a duty to self report breaches of the SRA Code of Conduct. If you don't report yourselves, you might get away with it, or we might catch you - that is a risk that you may or may not wish to take. However you know the Rules and so if you do decide to be naughty, well you will be looking over your shoulder for the rest of your days (or until the ban is relaxed/collapses in farcical fashion or is otherwise done away with - all of which are possible, but not certain). You can wave leading Counsels opinion on some brilliant new scheme that you have come up with as a way of getting round the ban, at us, but ultimately if it involves making a payment for a PI claim, it is banned. End of.

So there you have it. What you can do is go out and market properly and attract clients that way, but you'd better get going seriously if you haven't started already - and don't expect those 100 guaranteed new cases per month that you are getting at the moment by paying XYZ CMC Ltd £75,000 a month - no, no, no, that is not going to happen, certainly not in the near term (or to be honest in the long term). Alternatively you can form an ABS - but that is a separate issue altogether and provides enough material for 20 more blogs.

Anyway, I have just heard the theme tune to 'I'm a Celebrity, Get Me Out of Here' chiming up, so time to go and watch Nadine Dorries getting bitten by some more rats or submerged in a bath of maggots. Maybe ITV could try an alternative theme "I'm a PI Claimant Solicitor - Get Me Out of Here." At £40,000's worth of appearance money - now, there's a thought. That would buy an awful lot of claims (until 1st April 2013)!

As ever all of these off the wall views are my own in their entirety.

The Musings of a Grumpy Old Git

I'm feeling grumpy today. I have been in a good mood all day so not quite sure what has turned me sour. Ok well actually I do. Having been  beavering away all day, I decided to have a break late afternoon and turned to the excellent Legal Futures website. Apparently there has been some report or other carried out by the delightfully named 'Espirito Santo Investment Bank' which says (I haven't read the report - I can rely on Neil Rose and his team to tell me all I need to know);

• Numerous 'external investors' will appear on the scene once the 'floodgates of change' hit the PI market next year
• There will be just five or six claimant firms likely to dominate
• Lots of insurers fancy becoming ABS's (I'll bet they do!)
• Apparently PI Legal services will become - wait for this - you'll enjoy this piece of plain English - 'part of a more integrated supply chain..Service providers will increasingly include multi disciplinary tie-ups which offer bundled services. Size will be critical'. Really - bigger is better and all that?
• Most CMC's will disappear - if they are merely ticket touts ie selling on PI claims for more than they paid for them,then good. 
• Their (the CMC's) cases will be picked up by solicitors who have the funds (because they aren't paying referral fees anymore) and the time (because they've no work to do) and they will have suddenly picked up the skills (that they haven't had for all those years they were paying referral fees) and the inclination to go out and market for themselves and pick up lots of new PI cases. That'll be alright then - except wait - I thought the 'five or six' 'size is critical' outfits were going to hoover up all the new claims - so there aren't actually going to be any for the small to medium sized firms after all? Ah, here we go...
• As a result of the referral fee ban, claimant firms will either look to expand...or ...erm... they won't - in which latter case they will exit the market..

I started to get bored after that. Apparently there are going to be a lot more mergers and basically if you don't merge or form an ABS or get loads of funds invested in your firm to expand then you might as well go and do some conveyancing or become a shipping lawyer or something of that nature. Oh and if you do form an ABS, merge or take on 100 new staff and act the big law firm...don't forget that the only thing that has been decided is that referral fees for PI work are banned (but not yet properly defined blah blah). So you might in fact be spending a lot of money on ABS, merger, expansion and come April you may well find that you can't make RTA/PI pay!

The SRA and The Hot Potato

                                                                                 

I went to a talk given by a chap from the SRA last week about the ban on Referral Fees in Personal Injury cases and how this will be policed by the SRA in respect of solicitors (the Claims Management Regulator will look after CMC's, I believe). I hoped to glean some nuggets about what will and what won't be allowed. I came away scratching my head, it has to be said. In essence I knew nothing more when I came away from the talk, than when I went in.

I'm not having a go at the SRA man personally. As I have argued before, the SRA have been given a real hot potato to deal with here. An organisation that is already stretched in terms of work and resources now finds itself landed with the job that no-one wanted to do and already finite resources having to stretch even further in order to deal with it all. Add to that that the ban will come into force on the 1st April 2013 and with a formal 12 week consultation period yet to get under way following the responses to a recent discussion paper on the ban, and we will be left with a pitifully short period of time for all this to be in place for the due date.

As the SRA are not in favour of 'rules' as such then the mandatory outcomes will be amended with a few of those 'illustrative indicative behaviours' added and that will be it.

As the SRA has finite resources at it's disposal it seems certain that those firms which presently rely heavily on paying referral fees for work, will be closely looked at to see how they intend to move forward post April 2013.

Perhaps the SRA are being quite cute - cuter than we are perhaps giving them credit for. They know that RTA/PI lawyers are pretty wily characters, who given a rule will find a legitimate way of circumventing that rule. If the solicitor has no rule to 'get round' then he/she is left with taking a chance should they decide to try paying a 'referral fee' that is not a 'referral fee' - and being left with the prospect of being made an example of by the SRA, should it transpire that the 'referral fee' that was not intended to be a 'referral fee' ends up being one after all!

Ok, I hope that that clears everything up!

What Legal Marketers and Solicitors Firms Could Learn From a Good Cricket Coach and His Talented Pupil

Yesterday I took my 14 year old son Ben up to Leicestershire County Cricket Club to be coached by a former South African test cricketer. My lad is pretty useful himself already, playing at county level for his age group and above and playing a high standard of club cricket. So the raw materials are already there for him to potentially become a very successful cricketer.

Watching this top quality coach at work for just about an hour, was a revelation. First of all he watched my son bowl for about five minutes without saying anything. He was just assessing his client/customer going about his business.He told me that that was all that he was going to do for starters and for those five minutes he didn't say a word.

Then he did have a word with Ben. He told him that he liked what he saw - that my son had a good bowling action and that the basics were all there. What he said was needed, was to work on the final product ie the quality of the ball being delivered to the batsman.

He then 'suggested' that my son might like to practice bowling the ball using a slightly different grip to the one he was currently using. He did not say that what he was presently doing was wrong - just to try the suggested method and see how he felt after trying it out a few times. After a while my son was bowling using the new method and delivering a quality ball time and again. The coach suggested another method to add to his repertoire as well and soon Ben was bowling that delivery as suggested.

He then talked to Ben. He told him that he the coach was not going to send Ben away a wholly improved player after the session - that this was a long term project and that he would have to go away with a few new ideas, try them repeatedly and often and see which worked best for him and to keep practising those that he felt comfortable with. He also spent some time talking to him about how to bowl to batsmen who were intent on handling his bowling in different ways - some batsmen would be intent on just blocking him out, so a certain approach was needed to tempt them into hitting out at him to see if the batsman would make an error and get out. Some batmen would be intent on trying to put him off by attacking his bowling - again a different approach and a cool head would be needed with this type of player.

He finished off by telling Ben that what was needed above all was for him to practice, practice and practice - that he had all the right ingredients and by trying a few new ideas and with lots of practice he would achieve his goal of playing cricket at a higher and higher level (England Test team and a nice tour to Australia for Mum and Dad would go down well son!!)

What has this got to do with legal marketing, you might well ask?

Well it occurred to me that the approach that the coach adopted with my son in this session was precisely what a good legal marketing consultant should be adopting with a new client.

First of all he observed Ben bowling without making any comment. He did not dive straight in and tell Ben what he should be doing without first seeing how he went about his business of bowling in the first place.
Equally applicable to legal marketing, I would suggest. A good marketing consultant will not want to make suggestions that the client should try this or that marketing method without first observing how the client goes about his business on a day to day basis for a while initially. It might be that as with Ben, all the raw ingredients are there in the first place and that there is a really good base there from which to add some new ideas to ultimately achieve really good results. Having added those new ideas and methods to the repertoire, then what is needed is to keep on working at those good practices to achieve sustainable long term results, which in the legal example is not to bag loads of wickets, but to bag loads of new clients.

Then the coach went on to tell Ben that after the coaching session was finished yesterday he was not going to go away and suddenly become a superstar overnight - he would have to go away, practice the new methods, find out which worked best for him and assimilate them gradually into his game by constantly practising.

Equally once a good legal marketing consultant has completed the brief that he has been contracted to deliver to a firm of lawyers, it doesn't mean that a magic wand has been waved, resulting in floods of new clients ever more without the firm carrying on practising the new marketing methods that they have been shown by the consultant. First of all they need to find out which methods work for them and then to carry on working on putting those methods into practice on a daily, weekly or monthly basis, to ensure that long term results are achieved. Of course just as Ben would benefit from further follow up sessions with the coach, equally the solicitors firm could well benefit from some follow up work from the legal marketing consultant.

When the coach suggested that different approaches might be needed in bowling to different types of batsmen, it reminded me that firms of solicitors need to be flexible in their approach to dealing with and marketing to different types of potential clients. Social Media Marketing might play a big part in attracting a certain potential client base, but have little or no part to play with another where direct marketing might be necessary  For instance I have noticed that many reasonably sized insurance brokers have little or no web presence, let alone have Twitter or Facebook pages - perhaps if brokers are your  potential client target market then a direct campaign using email or direct snail mail marketing might be a better option.

Finally just as the coach told Ben that he needed to 'practice, practice and practice' so too does the law firm - just keep on doing what has been suggested over and over again - try different methods - as long as the product is sound. The maxim 'do the right things and the right things will happen' always seems to work in the long run.

Referral Fee Ban Part II

When I set up my own RTA/PI solicitors practice back in 1994 there were no such things as referral fees. To be honest I am probably wearing 'rose tinted' spectacles a little in saying that - I am sure they did exist but if they did, they were pretty much underground and passed by way of brown paper envelopes.

I was indeed fortunate to set up the practice at a time when it was quite a simple task - PI Insurance was relatively easy to come by for Sole Practitioners and with a rented office, a couple of desks and chairs, a computer, a printer, and some stationery, away I went (with no little help from Mrs Spin King I must add). No such thing as COLP's and COFA's or indeed ABS's -the only initials that you needed to know were IKEA - so that you could go and buy a nice bit of Scandianvian office furniture!

What was also needed was a bit of confidence to walk into insurance brokers, legal expense companies and local car body repairers and persuade them to refer to the new firm their customers in the event of their suffering a non fault accident - and then, (drum roll) the main ingredient from then on was 'To Provide a Top Class Service'!

Ah, can we remember those days when referrers wanted nothing more from a PI solicitor than for them to provide a good service to their clients, which in turn would result in a satisfied customer for the referrer and the likelihood or repeat business and further business from recommendations? Isn't that just good business practice and how businesses are meant to become successful?

As our good name grew, so did our case load. Happy days. Then referral fees started to surface. I am not sure whether this was solicitor led or referrer led to be honest. I do recall that certain solicitors practices seemed to be at the forefront of fee paying - usually wrapped up as some kind of marketing fee, for it was to be a few years before referral fees were legitimised. Finally they were officially recognised and the 'claims industry' went into overdrive. There have been some horrible excesses - with huge amounts of cash changing hands and both solicitors and claims management companies trying to outbid their rivals - all simply for the passing on of a PI, with no other service included, other than that of farming claims.

So, and regular readers of this blog might be surprised to read this, I am a supporter of the referral fee ban. Indeed I would have preferred that the original plans to criminalise the passing of referral fees for PI's had been pursued. Properly done that should have seen an end to the passing of money for the referral of claims. If all the governments efforts had been focused on passing well drafted legislation, with proper enforcement to back it up, that would have gone a long way to seeing an end to the practice and would have obviated the need for much of the further reform proposed, which in turn would have maintained a balance between genuine claimants with claims to pursue and the insurers on the other side. The decent claims management companies who have other services to provide, such as hire and repair, would have had to re-adjust but with proper planning would have survived and indeed prospered, and for solicitors they would have had to learn how to market themselves, as the market opened up with the demise of many of those who simply acted as PI middle men.

However, instead the legislature have opted against criminalisation and as stated in my last blog post they have passed the policing duties over to the SRA who have now been tasked with coming up with a strategy for ensuring that the ban is enforced. We have yet to see how well that policing is enforced. I do fear that there are those claims companies and solicitors who will already be thinking of ways around the ban, rather than accepting it and looking to change their models. It is, though, to be hoped that it is rigorously enforced and that those who flout the law and are caught out, are severely dealt with. Then, there is just a possibility  that there will be a return to the concept of those  that provide the best service prospering in a difficult market, rather than those that pay the most for claims or that offer cash or other incentives to claimants, doing so.

The Referral Fee Ban & The SRA - The Reluctant Police Force

An article in the Law Society Gazette today by John Hyde "SRA Ponders Policing of Referral Fee Ban" http://www.lawgazette.co.uk/news/sra-ponders-policing-referral-fee-ban confirms to me that the SRA have been landed with the role of an unwilling police force to deal with the ban which is to come into effect in just over 7 months.

According to Hyde, the Authority "will set out within weeks how it intends to police the forthcoming ban on referral fees." 'Within weeks' - really? Sorry, for some reason 'My SRA' keeps coming to mind. What a wonderfully thought out and executed concept that was. Perhaps first the SRA will have to have a consultation period of 3 months to consider what is meant by a 'few weeks'. Then after that it might come to the conclusion that 'a few weeks' actually means about 12 months - and even then give or take another 12 months either way - well not either way - just one way. So make that 2 years. Perhaps then we should add in some fancy online software to help with the policing. Add 12 months for that to be implemented and then - oops - it's crashed.

After that, according to the article, the Authority will 'draw up a formal policy position in advance of a 12 week consultation starting this autumn.' '12 weeks'? Don't even let me start going there. Perhaps the idea is to just send us all mad. I can see it now - the ambulances collecting us all to be dragged off screaming and shouting  to the 'Home for Bewildered Claimant Solicitors and CMC Proprietors' (with segregated wards to ensure that no referral fees can be passed on in the exercise yard).

I jest merely - well partly.

The SRA has been given the legal equivalent of a 'hospital pass' in rugby or football. The only alternative was for the 'Ministry of Silly Claims' to become involved and of course the government just wants to lay down the law, in a fashion. It doesn't want to have the job of enforcing it's hotchpot of legislation - and who can blame it?

Anyway once this has all been smoothly implemented - whatever is being implemented, we then only have to wait on the announcement on the Small Claims Track Limit for Personal Injury, the slashing of portal fees, etc, etc. Not to worry - we've got all of 7 and a bit months for this to get sorted.

Anyway at the end of the tunnel there is light - that pot of gold called the "ABS." Why some 15 have been authorised, don't you know - or is it 20? I really don't know. To be honest I've lost the will. Apparently there is now something called the "ABS rush." Now that does sound interesting. Is it a form of legal high? Better be on the safe side. "Pass the port Miss Moneypenny - and make mine a double."