Law Times

PAGE 6 COMMENT Law Times Group Publisher . . . . . . . Karen Lorimer Editorial Director . . . . . . . Gail J. Cohen Editor . . . . . . . . . . . . . . . . . . Glenn Kauth Staff Writer . . . . . . . . . . . . . Robert Todd Staff Writer . . . . . . . Michael McKiernan Copy Editor . . . . . . . . . Heather Gardiner CaseLaw Editor . . . . . Adela Rodriguez Art Director . . . . . . . . . . Alicia Adamson Account Co-ordinator . . . . Catherine Giles Electronic Production Specialist . . . . . . . . . . . . . Derek Welford Advertising Sales . . . . Kimberlee Pascoe Sales Co-ordinator . . . . . . . . . Sandy Shutt ©2011 Thomson Reuters Canada Ltd. All rights reserved. No part of this publication may be reprinted or stored in a retrieval system without written permission. The opinions expressed in articles are not necessarily those of the publisher. Information presented is compiled from sources believed to be accurate, however, the publisher assumes no responsibility for errors or omissions. Law Times disclaims any warranty as to the accuracy, completeness or currency of the contents of this publication and disclaims all liability in respect of the results of any action taken or not taken in reliance upon information in this publication. April 4, 2011 • lAw Times Law Times Thomson Reuters Canada Ltd. 240 Edward Street, Aurora, ON • L4G 3S9 Tel: 905-841-6481 • Fax: 905-727-0017 www.lawtimesnews.com Publications Mail Agreement Number 40762529 • ISSN 0847-5083 Law Times is published 40 times a year by Thomson Reuters Canada Ltd., 240 Edward St., Aurora, Ont. L4G 3S9 • 905-841-6481. clb.lteditor@thomsonreuters.com CIRCULATIONS & SUBSCRIPTIONS $165.00 + HST per year in Canada (HST Reg. #R121351134) and US$259.00 for foreign address- es. Single copies are $4.00 Circulation inquiries, post- al returns and address changes should include a copy of the mailing label(s) and should be sent to Law Times 240 Edward St., Aurora, Ont. L4G 3S9. Return postage guaranteed. Contact Jacquie Clancy at: jacquie.clancy@ thomsonreuters.com or Tel: 905-713-4392 • Toll free: 1-888-743-3551 or Fax: 905-841-4357. ADVERTISING Advertising inquiries and materials should be directed to Sales, Law Times, 240 Edward St., Aurora, Ont. L4G 3S9 or call Karen Lorimer at 905-713-4339 karen.lorimer@thomsonreuters.com, Kimberlee Pascoe at 905-713-4342 kimberlee.pascoe@thomson- reuters.com, or Sandy Shutt at 905-713-4337 sandra. shutt@thomsonreuters.com Law Times is printed on newsprint containing 25-30 per cent post-consumer recycled materials. Please recycle this newspaper. Editorial Obiter Province ignores calls for new courts terms of investment in infrastructure for the justice system. At the provincial level, Finance W Minister Dwight Duncan delivered a budget last Tuesday that showed a slight decline in the defi cit. Th at's good news. But in the meantime, he announced the cancellation of con- struction on a new courthouse in Eto- bicoke. Federally, we're now into an elec- tion, of course. But the budget re- vealed just before the government fell — which Finance Minister Jim Fla- herty has vowed to resurrect should the Tories win re-election in May — e've had two proposed bud- gets in the last two weeks but haven't seen much in noted new money for federal Crown prosecutors and judges in Nunavut only. Th at doesn't mean there won't be added resources for provinces such as Ontario, but offi cials aren't saying anything on that for the moment. Ontario Chief Justice Warren Win- kler has long called for new facilities for Toronto's criminal courts. Not only has that not yet become reality, but the one area in which the province had made moves — the Etobicoke facility — is now off the table. In the meantime, the government is investing in new jails in both Toronto and Windsor, Ont. Fed- erally, of course, the government has admitted its new laws to crack down on crime will cost billions, but so far it hasn't provided a full accounting of the planned expenses, an issue that sparked the speaker's ruling that held it in contempt of Parliament and helped spark the election in the fi rst place. But there's no question that taxpayers will be spending a lot to pay for the new laws, particularly for jails and correc- tions as inmates receive longer and more severe sentences. So there's money for jails but not much on infrastructure for the justice system that puts inmates there in the fi rst place. Of course, Winkler's repeat- ed calls for new facilities focus in large part on the heavy criminal caseloads the courts are dealing with. But in the mean- time, the government's serious fi nancial situation hasn't stopped it from moving ahead with planned expansions of the new full-day kindergarten program. To be fair, the province has invested in new court facilities in recent years in areas such as Th under Bay, Ont. Con- struction there is set to end in 2013. At the same time, there's no sugges- tion that things like full-day kinder- garten aren't worthy areas to spend money on. But with an already back- logged court system in Toronto set to see its caseload expand even more, it's hard to see the merit in taking money away from the planned Etobicoke fa- cility while expanding the education system into new areas and, of course, building new jails at the same time. Th e justice system, it seems, often comes last. — Glenn Kauth L aw fi rm mergers in recent months suggest there's a new twist in the history of the legal profession. Will it be bigger or richer? Bigger is making the news. Recently, Lang Michener LLP merged with McMillan LLP. Aylesworth LLP associated with a Detroit fi rm. Miller Th omson LLP absorbed one of Saskatch- ewan's leading fi rms. Th e big- gest splash came from Ogilvy Renault LLP, which is Mon- treal-based but has been active in Toronto for a decade. It will merge into the British-based in- ternational legal practice known as the Norton Rose Group. Only 25 years ago, a Cana- dian law fi rm could be big with a single offi ce and less than 100 lawyers. Th en in the late 1980s, a handful of fi rms led the charge to national expansion by merg- ing or expanding until they had sizable offi ces in the country's major business centres. By early in this century, there was little doubt the national fi rm platform was here to stay. By then, Calgary and Vancou- ver fi rms were moving east as Big firm, rich firm: new stages in legal history? That's fast as the Torontonians were moving west. Ogilvys was ex- panding from Quebec. Fasken Martineau DuMoulin LLP, Gowling Lafl eur Henderson LLP, Borden Ladner Gervais LLP, and Fraser Milner Cas- grain LLP had spread across the country. Torys LLP had its own growth by moving south to New York City. It was the biggest reshaping of law fi rm structures in a cen- tury. Th e lone-combat lawyer was yielding to the multi-city practice group. Law fi rm man- agement was evolving fast away from consensus-based part- nerships towards more corpo- rate structures. Mid-size fi rms seemed fated to merge or fade. But something else was going on. Even as everyone was get- ting bigger, some of the biggest fi rms in Canada and around the world stopped pursuing growth in numbers. McCarthy Tétrault LLP's early mergers had made it Can- ada's largest law fi rm by 1990. For a decade or so, being Can- ada's largest law fi rm was a key goal and a prominent aspect of History By Christopher Moore its marketing. Th at's no longer the case. By 2010, McCarthys actually had fewer lawyers than in 2004. It now stands fourth among Canadian law fi rms. But that didn't mean it was sliding on the profi tability charts. It was the same situation in- ternationally. In the 1990s, law fi rms in New York, Paris, Frank- furt, and London, England, be- gan partnering up. It seemed the world was about to see vast international law partnerships rather like the accounting-con- sulting behemoths. Th at didn't happen. None of the elite New York and Eu- ropean law fi rms made mergers in Canada or, by and large, in Australia, Japan, South Africa, and other centres. Th e leading fi rms there were too big and, crucially, not rich enough to www.lawtimesnews.com meet the earnings aspirations of their counterparts in New York and London. Th e global leaders, it turned out, wanted to be the richest rather than the biggest. To se- cure their share of the really top-level, high-priced legal work, major law fi rms need to be big and international but not too large. Th e most profi table fi rms actually began dropping out of the size race and shrink- ing their lawyer ranks. Being too big in too many cities, they had grasped, meant a lot of less lucrative retainers. Rather than having more partners in more cities, they focused on greater profi ts per partner. It's now looking similar in Canada. Firms that add offi ces and lawyers in Edmonton, Re- gina, Halifax, and Ottawa have a shot at being the biggest na- tionally. But the country's most profi table fi rms seem likely to let them have that distinction. Will Ogilvys' merger into Norton Rose change things? Norton Rose is now making the jump the Europeans and New Yorkers balked at a decade ago. Along with the Canadian entity, it has taken in big fi rms in South Africa and Australia. It has a rival in DLA Piper, a new- ly formed British-American- Australian megafi rm said to be looking for a Canadian link. Th ese fi rms are sure to be the biggest in the world. It's less certain they'll be the richest. Last year, Norton Rose ranked only 67th in global rankings by profi tability. Its international outreach may be securing it a kind of global mid-level sta- tus while conceding the most lucrative work of the interna- tional fi nancial hubs to more focused fi rms. Of course, if the international stock exchange mergers mean that most of the key Canadian corpo- rate decisions are going to happen elsewhere, then Ogilvys' move may come to signify a change as big as those of the 1980s. But that remains to be proven. Christopher Moore's newest book is Th e British Columbia Court of Appeal: Th e First Hundred Years. His web site is christopher moore.ca.

• Cover
• Helping Hands
• Handcuffed Courts
• Focus On ADR/Mediation