Muggles and the Ministry of Magic

In essence, this is an addendum to an early post and a rallying cry for every Costs Lawyer or student CL, to read, engage, debate and discuss the severity of the situation in which the ACL now finds itself. Everyone has an opportunity, and indeed a duty to assist in protecting and preserving the foundations of the title everyone in the ACL has worked hard to achieve. 

It really feels like this is a ‘do or die’ critical juncture for the ACL now and apathy just cannot be allowed to reign! If nothing else is achieved by what I write next other than to debate or shoot me down, I can let the chips fall where they may knowing that I tried. But I really do wonder, can everyone in the industry do this? 

I’ve seen the members report written by an accountant and I’ve seen the covering email from the Chairman, I’ve noted the preface from Kirsty Allison and I’ve seen the ‘options’ given to members. The rest is a bunch of accounts, which, if scrutinised could form the basis of their own quite intriguing report. I’ve later seen individuals giving their breakdowns of what the report says and stops short of saying. What I’ve not seen is an honest and frank public assessment of the report from within the Council itself.

I’m not even a Costs Lawyer. Here’s a crazy idea: How about taking up the responsibility to ensure that every Costs Lawyer is engaged and motivated to discuss the real issues. That the very title they hold dear and association providing it, is embattled and on life support.

I need to say, too, that it is my hope that whoever reads this understands that yes I’m a costs company owner and yes I spend my days trying to get a competitive edge against probably most of the Council and members in securing new business for my firm. But for the purposes of this document and the previous one; I’ve taken this hat off and I’m trying to apply my mind to how to help. I’m quite aware that if implemented, what I’ve proposed will benefit competitors but rather that, than the alternative. I’m prepared to earn my stripes as a business, so should others., but what I’m suggesting is a cohesive method to do this whilst raising standards and making the ACL/CLSB more powerful and more relevant than ever before.   

I hoped to make clear too, that ideas/concepts never come out fully formed and almost always take a new direction when mooted, discussed, debated and tested. I always allow them to take me in new directions and I listen to people who know more about topics than myself. I adapt and evolve my ideas based on this. But my message here, is very much this:

Where there is a will, there is a way.

Can I make abundantly clear – my suggestion to the ACL Council was merely an attempt to spark debate and test the basis of an extremely rough idea, conceived about a month ago by myself. At no point have I professed to be an expert on the structure or workings of the ACL/CLSB/ACLT, but I have a basic enough knowledge to know (and I think we can all agree) that all three currently could do with some new thinking. If that means a restructure to accommodate new ideas; so be it. My mentality is very much a ‘why not’ and ‘what if’ approach, both in life and in business. Just because something doesn’t currently exist doesn’t mean it can’t be done. 40 years ago there was no Association of Law Costs Draftsmen, until one was formed.

I’m perhaps a sophisticated layman, but ultimately admittedly a mere muggle who is knocking on the door of the Ministry of Magic begging to be heard. I may not be able to get in but I can certainly bang on the door to the telephone box. Because this is important. 

I’m doing so only because I’m fairly content that the ideas I offer is an advancement on the Report to members. It’s easy to criticise the Report, as others have but what I’m trying to do is lead a focus and thought to solutions not backbiting. Not so easy right? But any report worth it’s salt talking about an entity potentially closing it’s doors on monetary grounds ought to look into not offering reducing costs as an OPTION and should offer this as a TENET. I really think that what the members need to know is that the better part of the ￡48k they’re trying to get back by diluting membership for no betterment other than cash is simply going in no small part to pay for e-bulletins and diaries! But we are where we are.

Should we not focus energy on ideas to move forward and not seeking political currency on what has gone before and finger pointing. I’d rather we make progress on getting out of this mess to be quite frank. Hence why I’m sticking my oar in, in the first place.

Non-Costs Lawyer/Costs Lawyer hybrid Council.

My first point was the proposal of a motion to elect and admit non-Costs Lawyers onto the Council itself to create a more diverse hybrid. It would effectively be invoking bye-law 10.2.4, which states that the Council may appoint a person of their choosing subject to status/standing. Of course, this could also be ratified by election. I really think it’s time that the ACL moved with the times in this regard and having a CEO sitting sideways is not what I mean. I mean a level of check and balance to the direction of the Council and new blood with new ideas. Some people who think differently and are not burdened with past memories of in-fighting but who might knock heads together pointing out the higher goal here which is to have a Council to represent members at all.

Nitty Gritty

We can now begin with the business of exploratory discussion of my ideas/proposals to place them in fiscal context. These have always been and are now, aimed at being tested by greater minds than I. If my proposal helped and was adopted, great. If it sparked the ideas of another individual to come up with something better, brilliant! But rather people debate what I’m proposing and focus on new ideas than effectively eat each other and finger-point.  

I think it is warranted to set forth some clarity on a number of points in relation to my promotion of a NEW ACL MEMBER CATEGORY:

CORPORATE MEMBERS. 

Perhaps a little background might help by way of explanation of the genesis of the idea; in addition to demonstrating that there is a certain depth and breadth to thinking behind it. A happy aspect to it all, being that I’m a businessman first and foremost, is that there is a financial benefit to what I’m suggesting that I do not believe the ACL can ignore. 

Clarification

It has come to my attention that there is a belief that I am misinformed or even confused with regard to the make-up of the ACL/CLSB and indeed the inter-play and oversight of the Legal Services Act 2007. A point was privately made that I misunderstood the responsibilities of the representative/regulatory arm. This is actually not the case, although perhaps I wasn’t clear enough in my portrayal of how the idea might work in practice.  

The background to even thinking this way was my quest to find out what my colleague Michael Corris called ‘Costs Lawyer standard’. I wasn’t sure what he meant at first but I took him to mean that it was his personal pride in metering out technical advice to his own idea of an exalted ‘Costs Lawyer standard’. Having undertaken my research, what I found was a static Code of Conduct with no ACTIVE supervision or plans for this, other than the potential of a mystery shopper. What I was searching for did not exist beyond regulation of INDIVIDUALS. I was thinking about a Costs Lawyer firm-wide standard. I was thinking about compliance like law firms have and I was searching for something that did not exist.  

I decided to imagine a world where it did exist. I expected that this would surely have been considered and perhaps dismissed historically. I chatted in the office and I decided to wait for the publication of the Members’ Report because this would set out the plan to safeguard/preserve the ACL. We parked discussions, but on receipt of the report, I was amazed and disappointed in equal measure at what were being promoted as ‘options’ and none of them gave a shelf life of the ACL of more than a couple of years. 

I was galvanised to speak up, I’m not even a Costs Lawyer and I’m fighting for their association. I’m offering my ideas and I do not want nor expect to personally gain. But I am an employer and I care about, and I’m proud of the achievements and efforts my 6 Costs Lawyers put into gaining their status. I can’t sit around and watch it be thrown away. 

So instead of fighting me on minutiae of structure, join with me to think of ways to make things happen. Structures can be changed, if there is a will to do so.   

There’s a vested interest of other mainstream legal bodies too, that the ACL maintains it’s position and relevance but I was amazed to find that there is not much awareness of what is going on. I’ve considered authoring another article aimed at pulling law firm minds on to this crisis. But in the meantime, I’ll focus on my ideas pulling costs law firm minds INTO this crisis, to help pull everybody out of it and bring the industry together.

ACCREDITION

The Law Society is the ‘approved regulator’ of solicitors just as the ACL is the approved regulator of Costs Lawyers. However, as I understand it, under the 2007 Act there needs to be a separation between representation and regulation. So was born the Costs Lawyer Standards Board to act as regulator of INDIVIDUALS under devolved powers from ACL. Leaving the ACL itself as representative body for INDIVIDUALS. The anomaly being that the ACL is named in the 2007 and NOT the CLSB. Ipso facto there can be no CLSB without the ACL and if there’s no ACL, rights of audience under the Act follow suit. The ACLT, meanwhile looks after the Training arm and is the only approved trainer for Costs Lawyers. I may be wrong on this or other aspects of my points, but this is my understanding.

What is critical is a clear understanding that the aim of what I have suggested is to preserve the ACL in all capacities and keep this association going and dare I say it, GROW it! Am I the only one who feels sad that 20-25 new students is the expected norm moving forward for the Costs Lawyer course. 

We need to harness and leverage the currency in the talent and ACL BRAND to maximise revenues from all sides to give back by way of MORE education, more oversight, better transparency, more engagement on more levels and wider thinking from different perspectives than the potential for closed mentalities as having only Costs Lawyers on the Councils. In essence, move with the times; recognise perhaps where something hasn’t worked and change it. Restaurants often like to say “under new management” when they know there’s been a reputation for a few bad meals and in turn, the hope is that more punters give the place a try because it has turned a corner and changed something. The analogy fits here. Something needs to change, and it needs to change drastically.

I have a question for the Council and anyone else who can enlighten me, WHY the CLSB or ACL can’t create a corporate level quality framework and issue an accredited kite mark of it’s own volition?

From which body does the does the CLSB or ACL need authority to do this?

If the figure of 4,000 unregulated costs workers is correct, then the ACL currently represents 15% of its potential. Instead of being a divisional voice of that workforce, what I am suggesting could turn it into a near fully representative ARMY. But as with anything there needs to be a WHY. Rightly or wrongly, my own take is that the ACL has largely treated non-Costs Lawyers as ‘them’ and its own members as ‘us’. How about a ‘we’?

Pending an answer to my burning questions about why accreditation can’t happen; I’m going to imagine a world where I’m right, and there is an appetite and ability to bring a portion of the 4,000 non ACL costs workers into the fold, raise their standards to a ‘CLSB Costs Lawyer practice standard’ and engage them. In doing this, we naturally think about the workings of it and potentially the revenues. 

Let’s start with CORPORATE MEMBERSHIP.

Straight off the bat, we’re into discussing fees. A new source of revenue which could instantly replace the proposed affiliate membership suggestion but in doing so, engage with an even wider audience and USE this membership to go deeper into the territory of actually bringing as many of the 4,000 unregulated costs workers into the ACL fold. Forget them and us, let’s just have us. 

It was promoted in the report that ￡120 could be charged to a new affiliate member; I’m grateful to my colleague Michael Corris for his observation that firstly, this is already provided for under ACL Bye-law 7.1; this point is not new. Secondly, if these people weren’t interested in joining before, WHY would they join now? There needs to be a WHY! Nevertheless, a maximum of 400 anticipated punters might part with ￡120 each, making no more than ￡48,000. This may serve to fill the hole left to run the ACL course the next year, but has the potential to disrupt the Costs Lawyer community and diluting the cache of the CL title and ultimately the ‘brand’. You may even find a significant number of Costs Lawyers jumping ship if they feel that strongly about it. This will have its own financial ramifications and it hardly seems much of an option to me

With regard to membership fees, there are 298 costs FIRMS operating in England & Wales who employ at least one Costs Lawyer. This is the proposed target audience. These firms can be absorbed into the ACL and this membership monetised in a number of ways starting with entry fees. I’ve looked at arbitrary numbers to flesh out some values. Sole practitioners are already in, so we start with externals.

My initial arbitrary membership fee is set at ￡250. It could be more, could be slightly less but I’ve struck upon what seemed to me to be a fair base for a FIRM to become a CORPORATE member.  

External 1 CL only            97     x      ￡250 =        ￡24,250

External 1 CL+                 58      x      ￡250 =        ￡14,500

Defendant                        14      x        ￡250 =        ￡3,500

Internal                            83     x       ￡250 =        ￡20,750

Beyond this, you’d need to take account of size of the firm by CL so very simply, one idea perhaps could be to arrive at another figure per CL. In my workings, I’ve said ￡25 per CL. This affects the figures thus: 

External 1 CL                   97     x      ￡250 =         ￡24,250 

External 1 CL+                58     x      ￡250 + (278 CLs x ￡25) = ￡21,450

Defendant                       14      x      ￡250 + (47 CLs x ￡25) = ￡4,675

Internal                           83     x      ￡250 + (199 CLs x ￡25) = ￡25,725

Total potential Corporate Membership income: ￡76,100

The suggested flat fee of ￡250 could be more, it could be less, but I wanted to put values on it for context/perspective. The ￡25 per CL figure could be more or another sliding scale ‘flat fee’ rate for firms of varying sizes. The point is that I don’t have all the answers. I’ve always said these ideas are for the Council to improve upon, in the event that they are supported.

So we’ve potentially engaged and harnessed up to 298 FIRMS of Costs Lawyers and costs workers. What next? 

We think about the best way to raise the standards of service in the industry whilst minimising risk and adding brand value to the ACL (being the fullest representation of the profession it can be and harnessing and leveraging everything at its disposal within that pool of members, both corporate and individual).  The main way I felt this would be possible is to create an accreditation scheme which is owned and controlled, but not directly carried out, by the CLSB under devolved power from the ACL.  

(An offshoot from this could be to hold Corporate member conferences for firms to attend. This is an ancillary revenue stream which could also be marketed to potential supplier firms to our new army of members. Not only that, but among the congregation of delegates will be decision makers these people want to reach. As a company owner and non-Costs Lawyer, I do not attend ACL conferences but I am a decision maker in my company and it is likely I’m just the sort of target that suppliers like courier companies, software companies and any other relevant supplier might be interested in reaching. This could also apply to the actual website of the ACL – if you create a bigger focal point for the profession, you become a destination place where people want to advertise.)

The point is, we’re hooking corporate members in, because we’re offering them a what and a why. 

The ‘what’ is an accreditation which they can only get from the CLSB/ACL and which is a mechanism for Costs Lawyers and the firms they own/run or work for to stand out from the rest. After they’ve been awarded accreditation, they could be ranked by firm or individually. Larger firms can flex their muscles but smaller entities can stand out individually in a particular discipline or technical area and law firm clients can be armed with this information to make an informed decision. Accreditation is the what and standing out from the pack is the why. 

But let’s drill down on numbers and again I’m populating my calculations with arbitrary figures to give values. Subject to wider consideration, these could be whatever the ACL decides them to be, given advice from people who know far more about accreditation implementation that I. Wouldn’t it be nice though, for the ACL/CLSB to be totting up revenue in ￡1000’s, not ￡100’s, whilst keeping the membership ranks elite and upping transparency, quality and becoming MORE of a force in its 40th year, not less.  

Again, I’m grateful for Victoria Simpson from Apply Compliance Today’s input in this regard, having advised me how accreditation works for Lexcel. I’m aware too that APIL, who are not a regulator but a highly respected and organised representative body of personal injury lawyers, has their own accreditation scheme of which they’re very proud and which has gained traction and respect in the profession as a result. 

My proposition is that another course is marketed by ACLT, but this time for assessors. These assessors could be similar to those who run Lexcel/APIL’s model, but if you said to me you agreed AN entity could accredit but you didn’t think it could be ACL; that’s fine, but wouldn’t we rather have the ACL ring fence this and grow the brand? This is why I suggest there should be another course in addition to the current ACL course. I’m lead to believe that Lexcel Assessors pay up to ￡5,000 to become an assessor, because they then charge a day rate to audit on top to the firm they’re auditing/assessing.

Assuming an appropriate curriculum/model is set by the CLSB/ACLT, you would potentially need to attract around 100 assessors or more to cover the new corporate members. Could be less, could be more but there’s a potential ￡350,000 clear from that avenue alone if each one paid around ￡3,500. Traditionally, I’m told that assessors are charged more than students which is ￡2,500 and could be more? The point is, the ACL has the power to decide this.

Assessors would need to be subject to CPD and replace their license to assess each year, which is continual upkeep with the times and recurring revenue.

But then the firms being assessed would pay a fee to get accredited to get into the ranking system. This fee, again, could be whatever the ACL decided was fair. As I alluded to in my first rather basic post, I asked myself as a business owner, would I pay ￡2,500-￡3,000 as a company to set my firm apart nationally? Yes I would. Would others? I think they might. A wise man once said to me, “build it and they will come.”

So we’d be building a mechanism to CHARGE assessors, and CHARGE firms both to become a member and THEN to gain accreditation. 

How might the accreditation numbers stack up for example? We’re back to our lists of firms taken from the CLSB’s own website. 

Sole Practitioners             46 x ￡1,000 say =  ￡46,000

External 1 CL                   97 x ￡2,000 say =   ￡194,000

External 1 CL+                 58 x ￡3-4k say =    ￡174,000-￡232,000

Defendant                        14 x ￡2-3k say =     ￡28,000-￡42,000

Internal                            83 x ￡2-5k+ say =  ￡166,000-￡415,000

Total potential revenue: ￡608,000-￡929,000

There’s quite a number of firms with more than 1 CL and the Defendant side has a mix with the internal teams having a good number of single CLs working, but there are 15 firms who have 2-3 upwards reaching the highest at 35. There would need to be a way to be fair to everyone and keep them interested. My own firm might pay around ￡4k for instance + audit fees which I understand are charged to the firm. This means that revenue from accreditation is largely clear funds to the ACLT/CLSB, less administrative costs. It should go without saying that keeping costs as low as possible, as ironic as this is to say to a bunch of Costs Lawyers must be MANDATORY and NOT an option, however.  

So we’ve accredited our firms. Now what? I’m grateful to my colleague Michael Corris who came up with the idea of ranking firms accordingly. This could work in a similar way to the Legal 500 or Chambers Guide. It would need online support, but it could work as a mechanism for law firms or even members of the public to assess and choose the best costs law firm and Costs Lawyer for the work that needed to be undertaken. This rank would need to be regularly updated to be relevant, but if the funds are coming in from accreditation, this should be possible. This would allow individuals and firms to stand out and potentially unveil a new breed of Costs Lawyer who are ABOVE and elite in their abilities - and ranked accordingly such as in advocacy, technical advice or general service. I’ve always felt that choosing a Costs Lawyer is akin to choosing counsel. There are personal preferences based on gut feeling often. What if this was based on facts?

Recap

Corporate membership fees:                 ￡76,100

Assessor course revenue:                     ￡350,000

Accreditation revenue:                          ￡608-929,000

Corporate conference revenue               ￡TBC

ACL online training revenue                  ￡TBC

Advertising revenue                               ￡TBC

Even if you think I’m confused/misinformed and way off and halve forecasted revenues, you’re still potentially looking at a ￡500,000 concept. Can anyone afford to ignore this?  

Finally, I return to the point that if the ACL/CLSB has engaged corporate members, enlisted the army and now begins to enjoy the power, relevance and swelling of confidence the expansion and quality assessment mechanism has created, do we stop there?. No We halt a drain of ACL talent over to online seminar companies and we create our own ACL online, whereby you don’t have a sad situation that as a business owner, I get emails from independent training companies (albeit extremely reputable ones) offering to charge me hundreds of pounds to view a webinar on costs from a Costs Lawyer. How about the ACL/CLSB harvests that income, provides that service and becomes the go-to training hub envisaged by Carl Lygo.

This proposal is far from perfect. It is not expected to receive rapturous applause but the aim is that it could be debated, tested, used as a basis or adapted into something else. I just hope that after 40 years, the ACL could potentially have a bright future against the odds just by applying a bit of innovative and collaborative positive thinking for the good of everyone in this profession and not the few. In reading this and to appreciate any value in it, you’d need to forget who I am and focus on what I’ve said; then assess if I’ve said anything of value and go from there.

Either way, my main goal is for the thrust of these ideas to be put before the panel this Saturday and seriously considered.

The Chairman’s own words were that no idea could be considered wrong in deciding whether to maintain a representative arm for Costs Lawyers.

Whatever happens next, my conscience is clear knowing that I tried. I preach to my guys that they need to stand up and stand out if they want to set themselves apart. I lead from the front and I have thought of the greater good rather than attempting to personally gain from my own ideas. Can the same be same for everyone? To all Costs Lawyers out there, if you care about the future direction of the profession, or whether there should be one at all worth having, think of others, not just yourselves. Think differently. If you like any of the ideas above, brilliant. Help make them happen. If you hate them, that’s OK. Adapt, use, change all or anything as long as energy is focused on making something else as potentially beneficial happen.  

After all, the irony is not lost that one entry route to the MOM is flushing oneself down the toilet. How about opening up a telephone box or two? 

Muggles in the Ministry? Perish the thought.