The legal profession has largely snubbed the first wave of the Legal Services Act’s business structure reforms, with only 14 legal disciplinary practices up and running as the new regime came into force on Tuesday.

The takeup remained low despite a one-month extension to the original ‘go live’ date of 1 March.

Of the 14 firms passed fit to practise as LDPs by the Solicitors Regulation Authority on 31 March, 13 have non-lawyer managers and one has a lawyer manager. The SRA said it had rejected ‘a small number’ of applications but would not reveal the number.

LDPs allow non-lawyer professionals to form up to 25% of the partners in a law firm. They precede full alternative business structures, which are scheduled to be introduced between late 2011 and early 2012.

Commenting, justice minister Bridget Prentice described LDPs as a ‘big step towards realising the vision set out in the Legal Services Act and improving access to justice’. They will ‘encourage more effective competition, leading to innovation and price reductions’.

SRA chief executive Antony Townsend (pictured) said LDPs will allow the SRA to enhance public protection and open the legal market to new forms of business.

One of the first LDPs, West Yorkshire firm Switalskis, a six-partner legal aid firm, appointed John Durkan, a chartered accountant and the firm’s practice director, as managing partner. He said: ‘There are a lot of people of my ilk looking to get more involved. If they have really contributed to the firm, then there’s no reason why they shouldn’t have some of the equity.’

Michael Kennedy, partner at Switalskis, said: ‘You have to recognise that a law firm is a business. It does make a lot of sense to give a businessperson the authority to make big strategic decisions.’ However, he said that many lawyers might find it difficult to cede authority to non-lawyers. ‘They don’t seem to trust their expertise.’

So far, no barristers’ chambers has announced its intention to adopt the new structure. Barristers are unable to take advantage of the act’s provisions until June at the earliest while the Bar Standards Board considers changes to parts of the bar’s code of conduct.

However, Ian Dodd, director and founder of BarFutures, an alternative chambers providing clerking, marketing and office space for barristers without the overheads of chambers, said the company is looking to position itself to take advantage of opportunities provided by the Legal Services Act.

A sister company, Clarity Legal Solutions, provides support services for community law firms and Dodd said there is scope for bringing the two companies closer together. This would enable barristers and solicitors to bid together in Legal Services Commission tenders.

The Law Society has issued practice notes on LDPs and firm-based regulation, which also came into force on 31 March.

  • Next week’s Gazette carries an in-depth feature on LDPs.