Much has been written about the advent of legal disciplinary practices (LDPs) and the regulation of alternative business structures (ABSs) and their potential impact on the legal marketplace. But what has gone largely unnoticed is their potential impact on partnerships and LLPs which simply have no desire to go down the LDP route at this stage. It might be thought that for such firms there would be nothing to fear – but that couldn’t be more wrong.
Example 1: Take the firm (partnership or LLP) which, in common with so many others, decides to widen the expertise of its management board by inviting an eminent non-lawyer to become a member. All board members have a vote on decisions within their remit. Nothing wrong there, is there? Wrong. Under the ‘management and control’ requirement, which forms part of rule 14 of the revised Code of Conduct from the end of March 2009, every person who exercises any voting rights in a partnership or LLP must, in effect, be legally qualified or both approved by the SRA and what is unattractively styled a ‘manager’ (i.e. a partner/member of the firm).
