Garrigues' Fernando Vives says focusing on clients' needs rather than wins in the courtroom will pay off

It has been said that major multidisciplinary law firms are lucky in that in times of crisis, when the big M&A deals are few and far between, the lack of work in certain areas (such as corporate) can be offset by others (such as litigation and insolvency law) that are apparently "booming" in these challenging times.

If all of this is supposed to mean that during crisis periods we lawyers in the corporate/commercial law department sit twiddling our thumbs while those in the litigation department are leaving their desks at breakfast time, then this idea is very much mistaken. Happily, the truth of the matter is that the workload in each of the firm's various practice areas has remained much the same over recent years.

What has happened is 
rather that the type of work 
has undergone a change. Whether entering into a new agreement 
or terminating one, it is always 
a good idea to have a lawyer 
on hand. In other words, experience proves that clients always call for legal advisory services provided rigorously 
and loyally, perhaps even more so during times 
of hardship.

Rigour and loyalty: by the former, I mean the ever-present need to ensure that the technical advice is at all times excellent. The finest available. This is always key, whether in a boom or during more challenging economic times. By the latter, I mean that advice must at all times seek to meet clients' needs: we cannot sell coal to Newcastle, as one colleague told me recently, even when clients are at times hell-bent on buying it.

In the firm's litigation practice area, for example, while litigation is on the rise as far as the number of lawsuits in absolute terms is concerned, the figures, when examined a little more carefully, can reveal some interesting facts that reflect our clients' true needs.

Why are lawsuits on the up? At times (eg, lawsuits for contractual breach, which have seen a significant increase), the reason is straightforward: providers are finding it increasingly difficult to obtain credit in order to obtain the goods they had undertaken to supply, or distributors no longer simply accept the return of goods, instead demanding payment, which they urgently need in order to make other payments.

However, the number of lawsuits has not risen across the board. Large claims complaints are no longer so commonplace, while in bygone times clients cheerfully threw themselves into the legal arena in order to settle their differences. By contrast, there has been a noteworthy increase in demand for pre-litigation or out-of-court advisory services. Our clients are more cautious, preferring to reach an agreement and collect payment earlier rather than exposing themselves to the uncertain outcome of a lengthier process in which, when push comes to shove, they may be faced with a judgment entirely in their favour and an insolvent debtor. While winning a lawsuit is positive – particularly as an ego boost for us, the lawyers – ensuring that a client collects as much of its debt as possible is all the better.

Another characteristic feature: lawsuits are often essentially instrumental in nature. Even though the client knows that the debtor against whom a claim is filed is or will be effectively insolvent, it turns to a court proceeding in a bid to ensure that its claim is recognised within the context of a formal insolvency proceeding.

And finally, it is also common knowledge that, generally speaking, corporate litigation relating to challenges to corporate resolutions has dropped off sharply. Needless to say, this is not because these times of crisis have led shareholders to set aside their differences. I would go so far as to say that, in general terms, our clients have focused their efforts on filing only those claims they deem truly essential.

This change in the litigation strategy of many of our clients is by no means unwitting or coincidental. We can proudly claim that, at least in part, this about-face in the way in which they handle their legal affairs is down to our advice.

The current economic backdrop has left us with no choice but to raise our sights and see beyond the trees in order to make out the forest. As lawyers, we all too often succumb to the temptation to constantly prove to clients our skill, rigour and excellent service, and we run the risk of overlooking what is truly important: to meet their needs (and not ours).

There is no secret recipe for meeting clients' needs other than rigour, loyalty and common sense. Despite everything, we cannot let up in our efforts to continue doing so.

Fernando Vives (pictured) is managing partner of Garrigues.

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