A very good morning to
Distinguished speakers and moderators,
Members of the Bar, and
Ladies and gentlemen.
It is my great pleasure to welcome all of you today to our inaugural "Small Firms Convention 2019". I would like to thank our Small Firms Practice Committee, chaired by my learned colleague R Jayabalan, for their hard work in making this Convention a reality. I would also like to thank our experienced speakers and moderators who hail from the legal fraternity, the corporate industry, and tech start-ups for their time and effort to talk to our participants today.
Ladies and Gentleman,
1. Small firms, defined as firms with not more than five lawyers and without a branch, represent the future of the Bar. As of January this year, there are 6016 member firms that make up the Malaysian Bar and 88% of them are small firms. The number of small firms has been steadily on the rise.
2. The theme of the Convention today is "Survive. Sustain. Succeed". On a personal note, as partner of a small firm in Penang, I can identify with this. The partners of a small firm have to wear the hats of a lawyer, an entrepreneur, risk and compliance officer, administrative executive, HR recruiter, finance manager and tech guy. It is never easy to survive in light of the increasing competition faced by small firms and the changing landscape of legal practice, let alone sustain or even thrive in this industry.
3. To enable and allow for sustainability and success, the Bar has put in various initiatives over the years to assist our Members.
Group Law Practice
4. One such example is the introduction of the Legal Profession (Group Law Practice) Rules 2018, which came into operation on 30 Jun 2018. As a result of rising operating costs encountered by small firms, we permit up to five small law firms to operate together through a Group Law Practice while maintaining their individuality and remaining as separate entities. There are currently 14 registered Group Law Practices.
5. By operating as a group, small firms can reduce their operating costs, increase their skill sets, and maximise their potential, marketability and competitiveness in an increasingly competitive legal environment. We strongly encourage more firms to register as a Group Law Practice. Our Membership Department stands ready to assist.
Professional Indemnity Insurance Scheme
6. In 2007, the Bar revamped the Professional Indemnity Insurance ("PII") Scheme implemented in 1992, and opted for a mandatory PII Scheme.
7. The current mandatory PII Scheme provides protection to small firms as compared to an open market scheme where insurers tend to favour larger firms due to the premium received from larger firms.
8. I wish to use this opportunity to remind my fellow colleagues that to enable the Bar Council Secretariat to deal with your Sijil Annual and Practising Certificate ("SAPC") application expeditiously, kindly submit your application online, on or before 29 Nov 2019 (Friday).
9. For aspiring lawyers hoping to open up a law firm, my advice is that, it takes a leap of faith and courage to break out from being a salaried employee and build up your own law firm. Due to the challenges that owners of small firms face in the start-up of their legal services, the Bar has remained fully supportive to Members who are opening up their law firm and exploring different business opportunities. As Thio Shen Yi, SC , the then President of the Law Society of Singapore, put it,
"I believe that the proper function of the rule of law requires strong and thriving small law firms. Lawyers in these firms practising community law are legal assets which we must treasure and support. We may have a world class legal system and judiciary, but if the man in the street cannot get legal advice, then there is no access to justice, and the rule of law cannot be said to function."
10. In this regard, sometime in February 2011, the Bar launched a legal starter kit known as the START Kit. The START Kit provides basic information on the prerequisites, and the applicable rules and regulations to be complied with, in the setting up and running of a law firm. The START Kit also gives information and guidance on managing risk, time and staff. We hope that this initiative is helpful to our aspiring lawyers hoping to open up their own law firm.
11. In addition, since 2010, the Bar has maintained a Register of Mentors on the Malaysian Bar website to provide an opportunity for lawyers who are new in practice or wish to set up their own practice to seek guidance from senior Members on issues relating to practice management.
Ladies and Gentlemen,
12. The Bar also received feedback from Members that problems with cash flow are a major hurdle in setting up their own firm. The Bar is currently on the lookout for financial products available from financial institutions that can provide such funding specifically for small firms.
13. The Bar is also in the midst of devising training programmes for staff to improve the quality of services provided by small law firms as one of the problems faced by small law firms is the lack of well-trained staff. We all have gone through that experience.
Embracing Legal Technology
14. Notwithstanding the above initiatives that the Bar has put in place to assist small firms, we are often accused of being reluctant to promote and encourage the use of legal technology. It has been said that legal technology would be able to resolve the manpower and cost issues faced by small firms.
15. We must understand that although there are a lot of firms which are keen to try out new legal technology, the cost of the technology services could be prohibitive for smaller firms. It is considerations such as these that are taken into account when the Bar regulates legal technology.
16. The Bar needs to be meticulous and careful to ensure that the technology services are provided at a reasonable cost and enjoyable by all Members of the Bar. We must also avoid unscrupulous legal technology providers or monopolisation of the technology services. It is also necessary for the services to be monitored and scrutinised by the Bar, so that the technology services adopted by our Members will not be vulnerable to cyberattacks and data breaches.
17. On that note, the Bar Council has proposed a provision to govern legal technology and legal technology providers in the new Legal Profession Bill. Such a provision is necessary given that we have come a long way since the enactment of the Legal Profession Act 1976. We look forward to working closely with all legal technology providers, going forward.
18. It has also been suggested that against the backdrop of Industrial Revolution 4.0, Artificial Intelligence (AI) will ultimately end up replacing a lawyer's job to draft agreements, write submissions or conduct legal research. This "uprising" has sometimes been heralded as the impending demise of the small firms.
19. However, this is not true. Robots and AI lack the sympathy, empathy and emotions that "human" lawyers have. Technology should be seen to supplement our work, and not supplant us; complement our work, and not compete with us. I hope that my learned colleagues will embrace the use of technology and not view it as a threat. The Bar seeks to organise more events such as the Convention today to educate our Members that legal technology will actually make our work more productive. It is also hoped that the adoption of legal technology will contribute to a better work-life balance and hence better retention rate of talents in small firms.
20. We cannot hope in one convention, or in one day to resolve the issues that are affecting small firms. There will always be challenges when you decide to open up your own firm, such as manpower, cash flow and time management issues. However, the Bar will continue to do its utmost to assist our small firms to survive, sustain and succeed. To quote Richard Branson,
"A big business starts small."
21. Lastly, I would like to invite all of you to lend support to the Bar's flagship conference, "International Malaysia Law Conference", themed "Navigating the Present, Exploring the Future", which is to be held on 12-14 Aug 2020 in Kuala Lumpur. We hope that through the Conference, legal professionals can be inspired and empowered and be ready to embrace the impending technological transformations on our horizon. The early bird rate is RM750.
22. With that, I wish you all a fruitful and enjoyable Convention. I hope that when you leave this beautiful building, you are more enlightened in your legal practice.
Abdul Fareed Abdul Gafoor
14 Nov 2019