Tuesday, August 11, 2020
By NEIL HARTNELL
Tribune Business Editor
Commercial lawyers have seen business volumes plunge by up to 80 percent amid the latest COVID-19 lockdown, two ex-Cabinet ministers disclosed yesterday, describing the impact as “tremendous”.
Alfred Sears QC, the former attorney general, told Tribune Business there was “no question” the legal profession is suffering equally with multiple other industries as both new work and fee payments dry up due to business/individual clients concentrating solely on surviving the pandemic.
He estimated that mortgage, conveyancing and real estate-related work, which is a traditional staple for the Bahamian legal industry, is down by “70 percent or more” compared to normal business volumes, while “transactional” work relating to various types of commercial deals entered into by clients was off by at least 80 percent against pre-COVID-19 levels.
Mr Sears was backed by Branville McCartney, the Halsbury Chambers principal and ex-Democratic National Alliance (DNA) leader, who told this newspaper that legal work was down by more than 50 percent across all business categories.
While some observers may have little sympathy for the legal profession’s COVID-19 plight, both Messrs McCartney and Sears pointed out that law firms were businesses in their own right. Noting the sector’s significant economic contribution, Mr McCartney said his firm had been unable to bring back all administrative support staff from the first lockdown before the country was shut down again.
Detailing the extent and depth of the pandemic’s impact, Mr Sears said: “I would say that for people who are doing mortgages and conveyances, it [the fall-off] probably may be close to 70 percent or more, because the level of unemployment and/or reduction in income has put a lot of plans on hold in terms of acquisition of property.
“You have people with money, but in terms of volume and people buying new houses, and banks giving mortgages, I would say it’s 70 percent or more of that work. In terms of transactional work, with how investors look at expanding or purchasing, that is down 80 percent or more.”
Describing the effect this is having, Mr Sears said some Bahamian law firms had not only furloughed or cut management/administrative staff but also reduced their attorney numbers as well. Noting that major commercial law firms were not immune from this, he added of his own firm, Sears & Co: “I’m still keeping on my staff and am struggling with that.
“It’s a struggle. Some law firms have reduced staff, and some have reduced their lawyers - not only their support team but their legal team. It’s a very challenging time, and it’s going to be for the long haul. I think the legal profession, like the rest of the financial services sector, is impacted in a very profound way.
“You don’t have the ability to very easily meet and take instructions from your clients, and the court is primarily dealing with urgent matters, and matters on a remote basis by Zoom and Webex. Like every other sector, it means practices have to be scaled down,” Mr Sears continued.
“However, law is life, so even as people are dying in hospital there continues to be matters of probate, wills and powers of attorney. Law and legal services, and the provision of legal services, are critical not only to business but life.”
Mr McCartney, meanwhile, said the economic lockdown associated with COVID-19 meant attorneys and the legal profession would be hit just as hard as the rest of the economy. “The difficulty is we have a 40 percent unemployment rate today, more than 40 percent, which means almost half our working population is not working. That’s our clients,” he told Tribune Business.
“The bottom line is that paying legal fees, unless someone is going to jail, is the last thing on anybody’s mind for most people because they’re focusing on putting food on the table and having shelter. In light of the position facing the country, the legal profession has taken a tremendous hit.
“You have clients, whether private or institutional, not giving any type of work relating to the banks, mortgages and conveyances. That has slowed tremendously because no one can borrow. We have work, matters we have been working on, but it has slowed down more than 50 percent compared to what it would have been normally.”
Mr McCartney revealed that he had been unable to bring back all Halsbury Chambers’ administrative support staff from the first COVID-19 lockdown, as he had intended to do, before the latest restrictions were imposed by the Government.
“We are faced with this new lockdown, which I anticipate will be extended [beyond two weeks] in light of what’s going on,” he added. “The cases in New Providence in particular have increased tremendously, and it doesn’t seem to be flattening out at this stage.”
Asked about the long-term impact for the Bahamian legal profession, he reiterated that much depended on both the length of the current lockdown and “where we are in terms of getting our economy back” and ability to operate in as COVID-19 environment.
“The word for that is uncertainty,” Mr McCartney said. “This thing is not going away until there is a vaccine. You’re probably looking at early to mid-2021, hopefully earlier, and in our planning we have to bear that in mind. We have to be in a position to live with it and operate with this virus.
“It all depends on how long it takes to get to that stage in our country, where the people are disciplined in what they have to do, wearing masks, social distancing and sanitising. The quicker we’re able to do that, the quicker we’ll be in a position where we learn to operate with this virus and get our virus back.”
The ex-DNA leader, though, voiced fears that The Bahamas faced “a mammoth task” to salvage and rebuild its economy given that COVID-19’s impact had effectively plunged it into the equivalent of an economic depression with an unemployment rate equivalent to 40 percent.
He urged law firms to “hold on” and do their best to avoid adding to this jobless rate, saying: “This year marks 30 years since I became a lawyers and this, of course, is the worst I’ve ever seen it. It [sector lay-offs] means more unemployment.
“The bottom line is this is not the fault of anyone, quite frankly, in this country. This is the hand we’ve been dealt, and it’s how we deal with it. I pray and hope law firms and offices are able to hold on, but they are businesses at the end of the day. We provide legal services and businesses can only operate when we have that business. Right now, that business is limited.”