The flurry of international alliances and branding changes that are transforming the Perth legal market look set to continue.
About 30 years ago, Perth’s long-established law firms started linking up with their interstate counterparts.
The very first move of that kind occurred in 1979, when Perth firm Muir Williams Nicholson signed an agreement with Sydney firm Freehill Hollingdale & Page.
That was the start of a trend whereby nearly all major firms establish a national federation, followed by full financial integration.
The entry of international law firms to the Perth market is being seen in a similar light; the start of a pattern that will result in much stronger international linkages.
That is certainly the view of Blake Dawson chief executive John Carrington, whose firm announced a merger last month with UK-based firm Ashurst.
“We think there will be limited opportunities over the next five to 10 years for Australian law firms at the premium end of the market to be domestically focused,” he told WA Business News.
“That is an industry trend that we think is irreversible.”
The Blake Dawson move was the latest in about 10 transactions that have reshaped the Perth legal market (see table).
Other recent developments include:
• The official opening of Sydney firm Gilbert + Tobin’s local office, following its merger with Blakiston & Crabb.
• The launch of Squire Sanders’ Perth office, after most of Minter Ellison’s Perth partners joined the US firm.
• The opening of UK firm Holman Fenwick Willan’s Perth office.
• The merger of local firms Jackson McDonald and McKenzie Moncrieff.
Industry players see the entry of tier-one international firms Allen & Overy, Clifford Chance and Ashurst as the most significant developments.
And the question of everyone’s lips is: who will be next.
Gilbert + Tobin’s Danny Gilbert is not shy about saying an international link is one opportunity he is eyeing.
“We’re aiming to build one of the country’s leading corporate practices,” Mr Gilbert said.
“We want that to be a first-tier energy and resources firm.
“The aim is that the coming together of our two firms will give rise to opportunities that would not have been available to us as separate firms.
“But, also, I think it will make us ideally attracted when the right opportunity comes along.
“There are not many of the first-tier global law firms that are here yet.
“If the right opportunity came our way, we would look hard at it.”
Mr Gilbert insists he is in no hurry to do a deal, and can be selective.
“If we were to do something, we’d do it with one of the truly outstanding global law firms,” he said.
“That sounds a bit arrogant, but having worked so hard to build the firm here, we don’t want to settle for anything less than that.”
Ian Cochrane and his partners at Perth firm Cochrane Lishman Carson Luscombe held the same view until they were convinced that joining with London firm Clifford Chance was an attractive move.
Similarly, Geoff Simpson and a dozen of his colleagues enjoyed successful careers at Clayton Utz until they chose to join Allen & Overy.
These firms have started with a relatively small presence in Australia, whereas Ashurst will immediately become one of the country’s largest firms via its merger with Blake Dawson.
Mr Carrington identified two major drivers for the industry changes.
“The economic centre of gravity is shifting from the west to the east,” he said.
“And there is no question that the growth in the energy and resources sector is a driver.”
He said that Blake Dawson and Ashurst had worked together for 10 years, had a common view on where the market was going, and both wanted to be part of a global firm.
While the two firms have some overlap in Asia, Perth managing partner Paul Reithmuller believes their networks complement each other.
The merger is being implemented gradually, in order to manage the complete integration of the two firms.
Michael Blakiston also trod carefully, after Mr Gilbert phoned him three years ago to suggest they get together for a chat.
That was a time when Blakiston & Crabb was evaluating ways to acquire new capability, to meet the needs of its clients.
“Coincidentally, that was when Danny approached me,” Mr Blakiston said.
“He had some of the best people in Australia and, in his case, he didn’t have the upstream resources capacity.
“It was a case where we both needed each other.”
Mr Blakiston said that, during the three-year courtship with Gilbert + Tobin, he worked hard to ensure the Perth practice maintained its unique culture.
“The big thing that we resisted, and the message was heard and accepted, is that the West Australian market is quite different, and if an east coast model had been imposed, that would have been detrimental to our practice and our relationships with our clients,” he said.
“There is an element that allows us to be West Australian still.
“That was one of the big fears that clients had.”
Mr Gilbert said the merged firm was attracting more interest from other lawyers.
“There are partners in other law firms who are seeing what we are doing and picking the phone up and saying can we have a chat,” he said.
“They aren’t phone calls that Michael was getting before and they certainly weren’t phone calls that we were getting.”
Meanwhile, the split at Minter Ellison’s old Perth practice has resulted in the launch of three new legal offices.
Most of the partners joined Squire Sanders, which will have 14 partners and 80 lawyers in Perth.
Perth managing partner John Poulsen summed up the firm’s position in the market: “Our clients very quickly sized up the benefits to be had by working with an established cost-effective Western Australian firm that now has global reach.”
Squire Sanders’ total global headcount is 1,300 lawyers in 36 offices and 17 countries.
Minter Ellison, meanwhile, remains intent on rebuilding a substantial Perth business after securing space in Allendale Square to house the four partners and their staff who officially joined the integrated national practice at the start of this month.
The firm’s acting chief executive partner, Andrew Cunningham, told WA Business News this week the group had taken office space that would allow for growth to at least 50 lawyers from the current 30.
Mr Cunningham said the firm had wanted Perth brought into the fold for some time, even though some other Minter Ellison practices remained outside the nationally integrated practice, including Adelaide, Gold Coast and New Zealand.
“The difference is Perth is such a growth market ... and the agility we get from having a fully integrated focus is important in this dynamic market,” he said.
“We wanted an integrated practice for some time.
“We had discussions with them about it.
“At the end of the day there was not sufficient alignment of commercial objectives between them and us.”
However, Mr Cunningham remained coy about whether or not any new partners would be arriving in the near future, either through relocation of existing Minter Ellison personnel or through recruitment from other firms.
The firm has previously stated it wants to bring in six extra partners to bolster its Perth presence.
The third law firm to emerge from the break-up was national insurance law specialist Gilchrist Connell, which has recruited Minter Ellison’s Perth-based insurance team.
Gilchrist Connell’s Perth team will be headed by Minter Ellison’s 20-year veteran Deborah Tempelman.
While globalisation is a big theme in the legal profession, lawyers with a long memory may recall that some firms experimented with international links 30 years ago.
Perth firm Parker & Parker teamed up with Sydney firm Allen Allen & Hemsley around 1980 to jointly establish an office in London, targeting work linked to the North West Shelf gas project.
The venture extended to New York before being superceded by the establishment in the mid-1980s of the Australian Legal Group.
This was Australia’s first truly national federation of law firms, including Parker & Parker in Perth, Allens in Sydney and Arthur Robinson & Hedderwicks in Melbourne.
The latter two ended up becoming Allens Arthur Robinson, while Parker & Parker ended up joining with Freehill Hollingdale & Page to become Freehills.
