The novel corona virus has deeply affected the entire world. The whole world is in a state of lock down with all the economic activities coming to stand still and world is staring at the biggest recession since the Great Depression of 1930. It has already impacted the way we live and work. As the world is transformed by the COVID-19 pandemic, we see a complete makeover of the economic landscape with the emergence of new power centres.
When the dust settles down after the pandemic is over, we will see complete realignment across industries. Many businesses are going to fail and there will be a rise in bankruptcy and insolvency cases. Also, according to top mergers and acquisitions firms in India, there will be a spate of acquisitions and takeovers of businesses throughout the world. No industry or profession will remain untouched by this pandemic. As we can already see, there is a paradigm shift on how people think and work. In this article, we will talk about the effects of covid19 on law firm practices.
Effect of COVID-19 on the Legal System
The first and foremost effect of the pandemic on law practice can be seen in the court rooms. With most of the hearings postponed, except the urgent ones, the court rooms throughout the world have a deserted look. Depositions have been cancelled or postponed and deadlines have been extended indefinitely. There is a drastic fall in the number of new cases.
The urgency that is associated with the practice of law, because of strict deadlines, has largely been eliminated, and people are in no hurry to hire attorneys in the short term. All these delays and postponements are bound have an adverse effect on the income of the legal professionals.
Cash flows have stopped and the finances are in complete disarray. There is going to be defaults across the board, and attorneys who work in these areas would need to gear up quickly to address the needs of their clients.
Clients and Court Appearances
As it is already apparent, the work from home idea has now become a reality among the majority of the working class who had the option to do so. Though forced upon by the pandemic, it is going to stay even after we get out of this crisis. The difficulty that law firms will be facing would be about court appearances and the demographic structure of their clients. As cases get cancelled or postponed, many courts have been closed. Only essential and urgent activities, such as criminal hearings and family law cases are being taken up for hearing. All non-essential matters have been put on hold. Also, dealing remotely with older clients is a challenge as they need more personal interactions. Property cases require urgent attention as possibility of death looms large in light of the covid19 threat. Many people have been rendered unemployed because of this pandemic, and employment attorneys would be hard-pressed to provide assistance to such clients in getting relief from their employers and the government.
Effect on Business law Firms
The covid19 pandemic has severely affected the economic activities throughout the world. It has put a dent on small and big businesses alike. Defaults are almost certain and businesses would look to sped up their collection efforts to minimize the damage. A rise in non-compete litigation is expected, especially in the start-up categories as laid-off professionals start looking for fresh opportunities. Top mergers and acquisitions law firms in India predict a steep rise in M&A transactions across the globe. The reason being that a lot of businesses are likely to incur huge losses, which might force them to shut shops or sell their businesses to stronger players who have the financial muscle to survive the crisis.
If we go by historical evidences, we can expect to see a lot of new companies being launched by first time entrepreneurs after the covid19 turmoil come to an end. This is exactly what happened in the aftermath of the 2008 financial crisis. If the situation fans out similarly, then there will be great demand for business lawyers as companies try to re-establish themselves and new companies get launched.
Millions of people have been rendered jobless across the globe, and as these people head back to work, many of them will have to rethink their priorities, goals, and expectations. Many jobs are unlikely to return in the near future and many will be structurally altered. People will have to look for alternate career paths.
As businesses get severely impacted, business lawyers will be called upon to protect them. Lawyers would be needed to help business understand their new tax status, what new entities to create, what business structure to incorporate, and other aspects of operating a business.
To sum up, the covid19 pandemic will potentially alter the business landscape and other professions globally. This will significantly change the way law is practiced. There will be huge demand for lawyers, especially business lawyers, and top mergers and acquisitions law firms in India foresee increased activity in M&A transactions as there is a real possibility of many businesses going bust.
