20 September 2010NATIONAL

Nicole Garton-JonesHeritage Law, Vancouver

“In 10 years, whatwe’re doing is goingto be garden-variety.It’s just a matterof time beforemore firms looklike this.”

06-Leading the way:mag 8/25/10 6:24 PM Page 20

21Septembre 2010 www.cba.org

or decades, the traditional law firm business model has been a mas-terpiece of profitability, built on time-based billing, open-endedpricing and lawyers regularly reinventing the wheel.

But the model today is showing signs of strain as firms grappleto varying degrees with strategic stagnation, lawyer attrition and pricingpressures from clients. More and more industry watchers are warning thatroutine or repeatable elements of lawyers’ offerings — not the backbone ofall practices, but of many — are about to suffer a steep decline in prof-itability. What’s more, shared risk, predictable prices, systemic efficiencies,alignment with client interests — these are what clients are asking for. V

ENTURI+KARPA

By Jordan Furlong

Highly innovative start-up law firms are taking onnew markets, leveraging technology and dreaming upnew ways of doing business.

LEADINGTHEWAY

F

06-Leading the way:mag 8/27/10 11:40 AM Page 21

22 September 2010NATIONAL

apart isn’t what it does but how it does it. “Our lawyers havean unusual degree of flexibility and autonomy, and work-lifebalance is fundamental to our DNA,” says Garton-Jones.She traces Heritage Law’s distinctiveness back to its found-

ing in 2005: “I started as a solo, and I was pregnant.” This wasa challenge she had to figure out how to manage, and quickly.Her husband, a computer engineer, recommended and designeda paperless office with a virtual server, voice-over-IP phones andother modern amenities. It worked — and “because it workedfor me, I knew it was going to work for other people.”In several respects, this is a law firm with strict operational

expectations. There are minimum requirements for billing,client service, and business development, as well as time lim-its on returning calls and getting work out the door. Everyclient is contacted every three months to rate the firm on ascale of 1 to 5 (currently, 88% give it a 4 or 5). It’s a self-start-ing firm that can be hard on lawyers unprepared for thatmuch responsibility.But otherwise, flexibility, independence and entrepreneurship

Meeting this enormous challenge is a huge task for thelegal profession — but the good news is that we don’t need tostart from scratch. Already in Canada, new law firm modelsare emerging that promise different means to engage with themarketplace and to deliver legal services in ways that benefitmodern lawyers and their clients. Here are four such exam-ples to consider.

Heritage Law, Vancouver

Bythe time Nicole Garton-Jones had articled with BordenLadner Gervais LLP and worked with Bull HousserTupper LLP in Vancouver, she was sure of one thing:

“Being an associate in a larger firm wasn’t the right fit forme.” After brief stints in public affairs and as a contractlawyer, she started her own firm, Heritage Law, in June 2005.Today, that firm features six lawyers, an equal number of

staff, and one of the most streamlined, automated and forward-thinking legal business models in Canada. Heritage Law prac-tises family and estate law and mediation, but what sets the firm

Les éclaireursVoici les nouvelles firmes qui

tracent la voie vers un nouveaumodèle d’affaires, mieux adapté

aux défis modernes.

bureau, un système entièrement automatisé. En fait,pour fonctionner, la firme s’appuie largement sur desprogrammes et logiciels comme PCLaw et HotDocs.

« Ce n’est qu’une question de temps avant quedavantage de firmes ressemblent à cela », croit Me

Garton-Jones.

Zizzo Allan Climate Law, Toronto« Nous essayons de travailler en collaboration avecdes fournisseurs que nos clients pourraient utiliser »,explique Laura Zizzo, qui a quitté Gowling LafleurHenderson l’an dernier pour créer sa propre firme.Travis Allan s’est joint à elle en février.

À cet effet, elle cite l’exemple d’un appel d’offresdiffusé par la Toronto Region ConservationAuthority pour de la recherche concernant des pan-neaux solaires sur les toits autour de l’aéroportPearson. « Nous avons assemblé une équipe qui com-prenait des ingénieurs », explique-t-elle. « Et nousl’avons emporté. »

Le Barreau du Haut-Canada, bien entendu, observeavec intérêt la prestation innovatrice de servicesjuridiques. Mais Zizzo Allan passe la barre parce que lafirme comprend et souligne les différences entre lapratique du droit et la consultation. « Le Barreau ditque tant que vos clients ont l’impression que vousfournissez des services juridiques, que vous vousprésentez comme un avocat, que ce que vous faitestouche au droit et que c’est donc un avis juridique, ilest satisfait », dit l’avocate.

Selon elle, le succès de la profession dans l’avenirpasse par ce genre de multidisciplinarité. « Lesinterconnexions sont ce qui va régler certains de nos

Pendant des décennies, le modèle traditionneldes cabinets juridiques a été un chef-d'œuvrede profitabilité, érigé sur l’édifice des heures

facturables. Aujourd’hui, ce même modèle montredes signes de fatigue. De plus en plus, les clientsréclament un partage des risques, des coûts prévisi-bles, une efficacité systémique et un alignement avecleurs intérêts.

Relever ce défi sera une tâche énorme pour la pro-fession juridique. La bonne nouvelle, c’est qu’on nepart pas de zéro. Déjà, au Canada, de nouveaux mod-èles émergent. Ils proposent de nouveaux moyens derépondre aux besoins du marché, profitant à la foisaux avocats et à leurs clients. En voici trois exemples.

Heritage Law, VancouverUne fois son stage terminé chez Borden LadnerGervais et après avoir travaillé chez Bull HousserTupper à Vancouver, Nicole Gartin-Jones était sûred’une chose : « Être une jeune avocate dans unegrande firme n’était pas pour moi », dit-elle.

En 2005, elle a fondé Heritage Law. Aujourd’hui,la firme compte six avocates, autant de membres dupersonnel administratif. Et elle est l’une des étudeslégales les plus automatisées et avant-gardistes dansla pratique canadienne.

L’avocate retrace les débuts de Heritage Law à2005. « J’ai commencé ma carrière en solo et j’étaisenceinte », se souvient-elle. Son mari, ingénieurinformatique, a tracé les plans d’un bureau sanspaperasse, doté d’un serveur virtuel et d’autresinstallations modernes.

Heritage Law impressionne ses clients en publiantsa grille fixe d’honoraires sur son site web. « Pour laplupart des clients, c’est leur argent véritable, dit Me

Gartin-Jones. Ils écrivent leurs propres chèques, quisortent de leur compte personnel. »

À plusieurs égards, c’est une firme avec peu derègles ou d’attentes. Les six avocates (toutes desmères qui travaillent) font leur propre horaire etstructurent leur pratique comment elles le désirent.

Mais les nouveaux arrivants doivent faire connais-sance avec le système de gestion d’information du

grands problèmes — et pas seulement en matièrede changement climatique, note-t-elle. Donc j’en-courage les autres firmes à considérer les moyensd’y parvenir. »

n2one, OttawaThomas Prowse travaillait au département juridiquede Bell Northern Research (devenu Nortel) en 1994lorsque les logiciels à code ouvert (open source soft-ware) ont attiré son attention. Rapidement, ils sontdevenus plus qu’une simple technologie : ils sont de-venus un modèle de travail juridique.

Les ingénieurs, en première ligne, produisaientdes conventions de non divulgation, par exemple. Etpour les services juridiques, des parajuridiques fai-saient le tampon entre les clients et les avocats, quise chargeaient en dernier recours des problèmesplus complexes.

Cette approche a impressionné Me Prowse à unpoint tel que 16 ans plus tard, elle forme le fonde-ment du modèle de partage libre qu’il développe envue de fournir des services juridiques.

Il divise son temps entre son rôle d’avocat dans legroupe droit des technologies de Gowlings, à Kanata,et sa compagnie en démarrage, n2one inc. « Depuis1994 j’ai beaucoup réfléchi à la raison pour laquelleles services juridiques ne pourraient pas être fournisde la même manière que des logiciels, où ils seraientofferts à une large base d’abonnés, avec des revenusgénérés par un soutien continuel », explique-t-il.

Me Prowse compare son modèle à une roue.« Au bord, il y a une multitude de clients liés par uneressource commune d’informations juridiques »,explique-t-il. Le centre de la roue, plus petit, mais plusdispendieux, serait occupé par les avocats qui four-nissent des conseils légaux plus précis, sur demande.

« Je suis très excité par les possibilités que cegenre de modèles offrent à la profession, dit l’avo-cat. Mais je dois avouer que ma vision en est une trèscentrée sur les besoins des clients. »

Or, comme le suggèrent ces nouveaux modèles,c’est probablement cette vision qui donnera son élanà la profession légale pour les décennies à venir. N

06-Leading the way:mag 8/25/10 6:24 PM Page 22

23Septembre 2010 www.cba.org

MARKST

EGEL

carry the day. The six lawyers (all working mothers) set theirown schedules and structure their practices however they wishwithin the guidelines.

The firm also impresses clients by listing fixed-fee prices onits website. “For most clients, this is their real money,” shesays. “These are people writing cheques right out of their per-sonal account, and they’re afraid of the hourly rates. It’s a fearof the unknown, and I find that the fixed fee takes a lot of thefear away from it.”

Heritage Law invests heavily in systems to make all thispossible. New arrivals are introduced to its “plug-and-play”setup: “Here’s the information you need to be competent inthis area, here’s a checklist you have to follow for every mat-ter that comes in, an office manual for how we run the firm,what we do for marketing.... We’ve got a knowledge manage-ment system in place, we’ve got really good precedents, we’retotally automated.”

And the firm relies especially on technology. Although not“virtual” — it has two offices — the firm links a series of soft-ware programs like PCLaw, Time Matters, Worldox andHotDocs into a cohesive technology platform. “We don’thave any paper anywhere — it all lives on the server. And wehave a portal where you can do estate planning completelyon-line; there are some legal services where you never need tocome in at all.”

Despite this success, expansion plans are on hold for now.Nonetheless, says Garton-Jones: “In 10 years, what we’redoing is going to be garden-variety. It’s just a matter of timebefore more firms look like this.”

Zizzo Allan Climate Law LLP, Toronto

“We think a little bit differently,” says LauraZizzo, who left Gowling Lafleur HendersonLLP last year to launch her own climate change

practice (Travis Allan joined the partnership in February).“We try to work more collaboratively with other providersthat our clients might be using.” Indeed, Zizzo Allan routine-ly works with non-lawyers like engineers and business consul-tants when delivering climate change services to clients.

Zizzo cites one file, an RFP issued by the Toronto RegionConservation Authority for research regarding rooftop solararound Toronto’s Pearson Airport, as an example. “Weresponded to that RFP pretty confident that other law firmsprobably weren’t responding, and that it would be engineeringand consulting firms we’d be competing against. So we puttogether a team that included engineers, those with businessbackgrounds and those with specific consulting experiencewith stakeholder engagements, and we were successful.”

“It was a really fun project,” she adds, “because we got to actin an interdisciplinary fashion — we all had our areas of exper-tise for the final report, and we did a workshop with stakehold-ers that was really well received. It was a great example of work-ing together, using our legal skills to set the framework and theninterjecting the technical skills of the engineers.”

The Law Society of Upper Canada, of course, takes a keeninterest in the innovative delivery of legal services. But ZizzoAllan passes muster because it understands and underlines thedifference between practising law and consulting. Forinstance, whereas non-lawyer consultants can take client

LAURA ZIZZO, Zizzo Allan Climate Law LLP, Toronto“We try to work more collaboratively with other providers that our clients might be using.”

06-Leading the way:mag 8/25/10 6:24 PM Page 23

money up front and deposit it in the bank, Zizzo Allan placesall its retainers in a trust account until the work is complete.

“The law society is saying that as long as your clients areunder the impression that you’re providing legal services andholding yourself out as a lawyer, and what you’re doing istouching on the law and thus it’s legal advice, they’re happywith that,” says Zizzo, who describes the firm’s work as“more of a strategic advice service.”

She agrees that there are parallels with the constructionindustry, where a contractor pulls together a team of tradespeople for a specific job but disbands the team thereafter. “Thefolks that we bring in on those proposals act as subcontractorsto us, so it’s exactly the same model: there’s a contractor incharge who brings in all the service providers to do the aspectsthat they might not be able to do on their own.”

Flexible arrangements like these appeal to the firm morethan the multidisciplinary practice model created by the lawsociety, in which full-time non-lawyer professionals offer ser-vices in support of the law practice. Zizzo won’t rule outmigrating to a formal MDP down the road but likes the currentmodel. “We don’t say, ‘This engineer will do, because we havehim on staff; he might not be the best fit for the project, but he’swhat we’ve got.’ We try to find thebest fit for the project.”

Zizzo thinks cross-disciplinarycollaboration will be key to suc-cessful law practices in the future.“That’s the way business thinks,”she says. “They don’t compartmen-talize as much as we might think

24 September 2010NATIONAL

MARKST

EGEL

they do as lawyers. They want to see how all the pieces fittogether [into] a package that considers all these other issues.”

She adds. “Interconnections are going to be what solvessome of our great problems, not just in climate change, so Iwould encourage other firms to look at ways that they cando this.”

Cognition LLP, Toronto

Six years ago, Toronto neighbours Rubsun Ho and JoeMilstone were transitioning from previous corporatecounsel and VP-Legal positions. Both originally at large

law firms, they were now picking up a growing amount offreelance and consulting work. As their dockets continued tofill up, they decided to join forces and bring in other people tohelp them get the work done. The result, Cognition LLP, istoday one of only a handful of “dispersed” law firms world-wide that offer a different model for business law.

“We found there was a real attraction to the whole idea ofgrowth companies without in-house counsel, as well as compa-nies with legal departments that were constrained on headcountand budget, to be able to have another outlet to get good busi-ness-minded, in-house-type legal services,” says Milstone.

“Their only options, until us, wereeither to hire someone full-time ... orgo to the traditional outside firms.”Ho describes a typical client: “Acompany that requires legal helpwith all their day-to-day commer-cial contacts, supplier agreements,employment matters — everything

JOE MILSTONE and RUBSUN HOCognition LLP, Toronto

“We operate almost like a just-in-time, on-demand resource for people

needing our kinds of services.”— Joe Milstone —

06-Leading the way:mag 8/25/10 6:24 PM Page 24

25Septembre 2010 www.cba.org

that in-house counsel would normally do — but doesn’t haveenough of that work to merit hiring a full-time resource. Theybring us in on a fractional basis, one or two days a week, andour lawyer becomes their de facto in-house counsel and pro-vides the work as needed.”

If it’s busy, he says, the lawyers bill more hours; if it isn’t,they may not bill any hours. The arrangement, combinedwith Cognition’s lower overhead and cost structure, allowsits lawyers (who usually feature a “best-of-breed” mix of in-house and law firm experience) charge rates that areextremely competitive with those in more traditional firms.Other work comes from companies that have seasonal orproject needs.

Milstone compares the Cognition model’s impact on themarketplace to the ways in which new business processeschanged industries like automotive parts. “We operate almostlike a just-in-time, on-demand resource for people needing ourkinds of services.”

Neither Milstone nor Ho think their model will replacelarge law firms, nor do they think it should. “We provide analternative,” Ho says. “There’s obviously still a big ongoingrole for existing firms.”

More to the point, they believe that the market is disaggre-gating. “We get referrals from some of the big firms,” says Ho.“Things that can be done more efficiently should be donemore efficiently, and firms have too much overhead or fixedcosts to be able to provide the same efficiency we can. Butwhere you do need specialist advice or a team of people towork on certain matters, that’s where the value of the big firmreally comes through.

n2one, Ottawa

Thomas Prowse was working in the law department ofBell Northern Research (later Nortel) in 1994 whenopen-source software first caught his eye. Very shortly

thereafter, open-source became more than just an importanttechnology: It became a significant generator of legal work. “Iused to joke that there were two lawyers and 12,000 engi-neers,” he recalls. “Not only were we badly outnumbered,they had technology on their side.”

The sheer volume of work forced Prowse and his colleaguesto develop a scalable legal services delivery model. “Wedeployed a global non-disclosure agreement system with aparalegal, so that we could, in some sense, mirror the softwaresupport model of having different tiers of support. We wouldencourage engineers and their managers to do as much of thework as possible, so that they’d be their own first line of sup-port. Our paralegal was the second line of support, and if nec-essary, it would [eventually] come to the lawyers.”

This approach impressed Prowse so much that 16 yearslater, it forms the backbone of his commitment to a new “com-mon sourcing” model for legal services delivery.“I see com-mon sourcing and the underlying phenomenon as changingthe way that we create and deliver value,” he says.

Prowse is as a self-described “partnerpreneur” who divideshis time between his technology lawyer role in Gowlings’Kanata Technology Law Office and his start-up company,n2one inc. “n2one” is a play on Cisco GC Mark Chandler’sfamous lament that professional services were stuck in a “one-to-one” model rather than a “many-to-one” approach.

“From 1994 on, I’ve been thinking a lot about why legal

THOMAS PROWSE, Gowlings, founder n2one, Ottawa

“I see common sourcing and the underlying phenomenon as changingthe way that we create and deliver value.”

MIKEPINDER

06-Leading the way:mag 8/27/10 11:40 AM Page 25

NATL06_026.indd 1 09/02/2010 11:09:55 AM