A quiet revolution is taking place in the UK legal profession.

Ten years of international consolidation, the emergence of global giants and the decline of the full-service law firm have generated plenty of sometimes anguished debate over the drift from profession to business.

Yet one taboo is being rapidly shed with barely a murmur.

The practice involves major commercial law firms in the UK accepting individual instructions with an agreed limit on what a client could recover in the event of a future negligence claim – liability capping, as it is usually known.

And such arrangements, which have emerged in the post-Enron period as advisers grow increasingly fearful of being targeted in a major corporate collapse, are by all accounts spreading rapidly.

A Legal Week poll this month found that nearly three-quarters of UK partners admit that their firm at least occasionally seeks to limit its liability on individual transactions, while more than one in 10 does so routinely.

The results reflect a notable shift from just 12 months previously, when almost half of respondents insisted in a similar poll that their firm never looked to cap its liability, a figure that has now fallen to just 28%.

The speed of the shift indicates that liability capping is not simply on the agenda for City firms – it is already here, with names as respected as Linklaters and Allen & Overy (A&O) known to have at the least tested the water with such arrangements.

Yet pinning down the practice is difficult, partly because it is applied in very different ways.

In some instances, firms attempt to hold liability to a flat rate dependent on the scale of the transaction, sometimes as low as £1m. Another approach links maximum liability to multiples of fees earned.

The technique is apparently so far largely confined to a few sectors, with advisers citing its use in certain areas of project finance and private equity due diligence.

A related trend has seen the increasing use of 'proportionality' or 'non-contamination' clauses, ensuring that a firm cannot be held liable for third parties or clients.

A&O partnership expert Richard Turnor comments: "Every firm has looked at capping liability on an ad hoc basis. I suspect the mid-tier has been more successful as top-tier firms do more work for the banks – which remain very opposed."

Client opposition explains why partners remain cagey over specifics, reflecting concerns that no major firm can afford to strike out alone in an intensely competitive market.

But one magic circle partner arguably sums up the current mood when he says: "If we thought we could cap liability without losing business, we would do it. The accountancy firms had to club together and the relative lack of consolidation in the legal market is an obstacle."

One in-house counsel at a major international corporate says that the practice still retains a stigma for legal advisers.

"We are seeing some firms attempting it and it is something we are resisting. Fortunately, we have the clout. In the event of a claim, we expect the advisers to carry the can."

Yet he admits he would be surprised if the practice was not "preva-lent in the next five to 10 years".

Shell general counsel Richard Wiseman takes a more flexible stance. "It is not unreasonable for solicitors to want to limit their liability – all the other professional services do it. It also should reduce costs as firms' insurance arrangements will take their liability into account," he reasons.

"But realistically if a firm wants to cap its liability at £50m then it will not get instructed on a £5bn transaction. There must be an element of proportionality."

Parallels can be drawn with firms switching to limited liability status, with Herbert Smith in January committing to a limited liability partnership (LLP) conversion.

What was once perceived as a revolutionary step is now rapidly becoming the norm.

"Everybody is jumping on the LLP bandwagon, which was initially a big step," says one A&O partner. "But, of course, that does not save bankrupting the firm."

Yet capping liability takes sensible risk management into a new realm, raising far more fundamental ethical issues. A client instructing a major LLP law firms still has the cushion of hundreds of millions of pounds of insurance cover and millions more in partners' capital. In short, a firm is still putting a lot on the line when it puts its name to a legal document – capping could see firms accept only a tiny fraction of that risk.

Such concerns will become more pressing if, as many suggest, it is only a matter of time before capping on mainstream commercial deals becomes a familiar part of the legal landscape.

Notably, two of the UK's leading national firms have not so much grasped the nettle as fully embraced it.

Last year Eversheds took the pioneering step of introducing liability caps in its standard terms of engagement on particular types of deal – a move later mirrored by the legacy Pinsents.

"It has had no impact on our client relationships," maintains managing partner David Gray. "We are looking at ourselves as a business, not as a law firm. It is no more than common sense and good business practice – and most clients accept that."

While the City's top tier has yet to adopt such an approach, UK legal advisers are uniformly taking a more active approach to risk management.

As Linklaters general counsel Raymond Cohen comments: "Liability caps are not really practical with our client base [but] the firm has put more emphasis on risk management. If we saw a firm wiped out by a significant claim, that might make the market reassess its position."

As ever, some traditionalists need convincing.

However, a willingness to gamble the firm's future in the interest of client relations increasingly seems to be a minority view.

And with Hammonds still facing a potential £180m negligence claim from the Football League relating to the collapse of ITV Digital in 2002, that extra spur of motivation for City firms hesitant to confront the issue directly could come at any minute.

As Eversheds' Gray adds: "A lot of firms are following our example. They do not like to be leaders [but] risk management has become key for law firms."

"There is undeniably a growing momentum," agrees Reynolds Porter Chamberlain professional liability specialist Nick Bird.

"The key is to identify which areas can be capped from a commercial point of view. Banking is an obvious area to target – and anywhere involving significant figures – but that is where there are the most problems commercially."

The question remains whether London's top firms will follow. Since these are the practices that have brands sold on quality – quality which demands a premium – it will initially be a tough sell for major clients.

But the signs are that they will sooner or later try.

As one magic circle partner comments: "A couple of major claims could change everything. If it becomes market practice we would be delighted."

A sea-change in firms' attitudes to risk has already taken place. Even for those that support such tactics, it seems troubling that such a shift has become apparently inevitable with so little debate.