Ten years ago this month, Perth’s legal profession underwent a seismic change when the city’s two largest firms, Parker & Parker and Freehill, Hollingdale & Page, agreed to merge.
It was a landmark change that highlighted the trend for independent Perth law firms like Parker to integrate with national practices.
Jackson McDonald and Lavan Legal are the rare exceptions to this trend, which has led to the disappearance of names like Stone James, Robinson Cox and Northmore, Hale, Davey & Leake.
The merger of Parker and Freehills created by far the biggest law firm in Perth, with just over 50 partners and more than 300 staff.
Freehills, as the firm has been known since 2000, is still Perth’s biggest law firm, even though partner numbers have dropped to 33 and staff numbers to 280.
The merger was conceived by Peter Mansell, who was then managing partner of Freehills, and John Atkins, who was managing Parker.
Mr Atkins, who is currently Freehills head of office, recalls that the merger caught many people by surprise
“It came as a shock to everybody, it was not what people expected,” he told WA Business News.
The merger included a two-year standstill agreement for partners, and many outsiders had tipped an exodus of partners once that expired.
“People thought it wouldn’t last, they thought there would be blood on the floor,” Mr Atkins said.
And while Mr Atkins acknowledges there was some disruption and staff losses, he believes the success of the merger far outweighs any problems.
“We had to make a decision for the future, not the past.”
The merger followed substantial changes by the two firms, which were among the first in Perth to look decisively beyond their local base.
Muir Williams Nicholson (as Freehills was originally known in Perth) signed an alliance with Sydney firm Freehill, Hollingdale & Page in 1979.
That was followed by the creation of a national federation in the mid 1980s, when all of the member firms started trading as FH&P.
Parker took a different tack, teaming up with Sydney firm Allen Allen & Hemsley in the late 1970s to jointly establish offices in London and New York.
The partnership was superseded by the formation in the mid 1980s of the Australian Legal Group, which was considered to be Australia’s first truly national federation of law firms.
The Australian Legal Group unravelled in the mid 1990s when, among other things, Melbourne firm Arthur Robinson & Hedderwicks established its own Perth office.
Some Perth lawyers are still scarred by that unexpected move, which forced Parker to rethink its future.
Mr Mansell suggested the merger to Mr Atkins in November 1996.
Mr Atkins said the senior partners at Parker were keen to pursue a national deal but it took a couple of months before they were all committed to the concept, which was announced to staff in February 1997.
The target date was initially May 1 1997, but this was deferred, in part because the size and prominence of the two firms in Perth meant that a number of conflict of interest issues had to be ironed out.
Most notably, Parker had been representing the banks in the Bell Group litigation while Freehills had previously advised the Bell Group liquidator.
The merged group continued representing the banks, which meant Freehills partner Konrad de Kerloy had to move to London for two years to avoid any perceived conflicts.
The merged group also chose to house the Bell Group litigation team at Freehills’ premises in Australia Square, while the other staff moved into the former AMP Building.
Mr Atkins said the goal had been to establish a dominant, full-service commercial law firm, to eliminate weaknesses in the two member firms, to retain work that might otherwise have gone to the east coast or overseas, and to minimise client losses.
“If you judge by what we were trying to achieve, then it has been a success on nearly all levels,” he said.