When reviewing Transport’s year in 2015/2016, it is interesting to note that the volatility in this specialist legal area has not subsided since the last review in 2014/2015. Last year saw various mid-tier firms seek to break into the Transport market. But can they be guaranteed greater success than other mid-tier firms that had similar ambitions and have all but culled their Transport practices in the same period? Time will tell, with the market already primed for further movement.
Whereas Transport in Australia probably fared somewhat better than many other areas of law in Australia during the GFC, it has been hit quite hard in the last 18 months by the slowing down of Chinese development with its impact on the resources ‘boom’ in Western Australia, the severe drop in oil prices and the stagnation of many of the offshore Australian oil & gas projects. All such sectors are heavily reliant on transportation. When combined with the low global freight rates and the continuing price squeeze on traditional marine insurance law work, the impact on some Australian law firms with Transport service offerings has been acute.
Holding Redlich sought to capitalise on instability in the market with its lateral partner hires from Norton White, HWL Ebsworth and Macpherson Kelley in late 2014. Assisting in that assimilation was the fact that Holding Redlich already had an agribusiness practice which dovetailed with the practice of Geoff Farnsworth. That said, it is certainly unchartered waters for Holding Redlich as far as the more traditional components of Transport law are concerned. Those three moves have remained of interest in 2015, from the perspective of the holes left at their previous firms by their departures, with none of the three firms affected having replaced those departing partners.
The size of the Transport practices at Norton White and HWL Ebsworth appear to have reduced considerably, while it would appear that Macpherson Kelley no longer holds itself out as having a Transport offering at all. In a similar vein, Piper Alderman has not filled the hole left by Frazer Hunt’s move with his team to Mills Oakley in late 2014. This would suggest that while a Transport practice can be profitable, law firms seeking to develop offerings in this space need to have patience. It remains to be seen how well new entrant law firms will cope with the unique demands of a Transport practice.
The moves have certainly not all been in the mid-tier. The departures of Hazel Brasington, Jenny Bazakas and Francis Burgess from Holman Fenwick Willan’s Melbourne offering have not been matched with ‘like for like’ replacements which may mirror a reduction of their market share on the back of some panel losses to rival Clyde & Co. The three abovementioned departures from Holman Fenwick Willan aside, they and the globally backed and supported duo of Clyde & Co and Norton Rose Fulbright remain somewhat insulated from the separate woes of the individual sectors mentioned above, due to the fact that all three can service clients across all of the said sectors rather than having their fortunes tied up more selectively. This assists in smoothing over traditional highs and lows in individual Transport sectors. Each have the resources to respond to any sized matter in any Australian or offshore Australian jurisdiction, whether it be via local talent or specifically deployed specialist regional talent, with Holman Fenwick Willan and Clyde & Co having unrivalled depth of personnel and expertise at their disposal in Asia Pacific.
Opportunities continue to grow in Western Australia for maritime work particularly for global firms such as Clyde & Co and Holman Fenwick Willan that have invested heavily in that market. Invariably, they go head to head with Cocks Macnish who continue to command the first call from many of the P&I Clubs and owners for Western Australian maritime matters and have seen a surge in work off the back of increased vessel arrest instructions. Heavy lift logistics and project related instructions are also on the rise.
Not unlike this scenario in the West, Brian White continues to command the pick of instructions from P&I Clubs and Owners in North Queensland and the South Pacific despite challenges coming from Thynne McCartney and Clyde & Co.
Consistent opportunities are also beginning to arise in port related instructions, particularly in Queensland (eg. for coal) and South Australia (eg. for grain). Transport outlier Minter Ellison has sought to exploit opportunities in South Australia, but with no recognised partner presence will struggle to wrestle any market share from existing interstate players and with Wallmans Lawyers continuing to be recognised as a reliable local source for the more traditional Transport fare.
There has certainly been a significant shift in fortunes at the upper end of the market with the battlegrounds for 2016 firming as being Queensland and Western Australia.