Since June, the price of oil has dropped by over 50 per cent, and is set to become Canada’s biggest problem of 2015. The drop in oil prices has helped to trigger a recession throughout the country, as although the production of crude oil only represents 3 per cent of Canada’s GDP, the drop in oil prices has had a detrimental effect on the economy at large. On 15 July 2015, the central bank slashed its forecast for the Canadian economy, predicting growth for the full year to be just 1.1 per cent. In response to the news, the Canadian dollar fell by more than a cent, to end at 77.40 cents, its lowest level since the depth of the recession in 2009.
The drop in oil prices means that the oil industry is expected to lose 37 per cent of its revenue in 2015. The oil crisis has had a knock-on effect for legal firms, who have seen a contraction in activity in their oil and gas practices. Calgary-based firms and offices are experiencing a decline in work related to the industry, with practice areas such as capital markets transactions, M&A and project financings all suffering. Despite this, firms are optimistic that soon they will see an increase in opportunistic transactions, as well as more restructuring work, as smaller oil companies are absorbed by larger and more financially stable rivals. Our research mirrors these expectations, with the insolvency and restructuring chapter achieving 58 listings and the energy sector boasting an impressive 61 nominations, an increase of three lawyers from last year.
Despite the oil crisis, there is still activity in Canada, although attention has shifted from the west to the central provinces of Ontario and Quebec, areas which concentrate on manufacturing services. As a result of this, Ontario is set to replace oil-rich Alberta as the fastest-growing province this year. The manufacturing industries of cars and aerospace are experiencing a boost in exports due to the depreciation of the Canadian dollar. Furthermore the technology sector is surpassing the energy sector in the initial public offering market as investors look for alternative companies in which to invest their capital. Recent successes in the Canadian market are also a driving force of further activity. Since going public last year, shares of software-maker Kinaxis have increased by 90 per cent.
The legal marketplace continues to evolve, and the past year has seen more international firms enter the market. DLA Piper has joined forces with Davis enabling the Canadian firm to access its global network of offices and clients. Last year’s demise of Heenan Blaikie is still very much on the mind of legal managing partners and sits as a reminder of the difficulties of running a profitable law firm in the current financial climate. Another of Canada’s law firms, Gowlings, will merge in January 2016 with UK based Wragge Lawrence Graham & Co after a year and a half of talks, to form Gowlings WLG. Globalisation is a key reason as to why law firms are opting to merge, in the hope that it will alleviate some of the difficulties that they are facing, such as costs and manpower. Furthermore, such partnerships allow firms like Davis to broaden their client offerings with their improved international reach, whilst continuing with the dedicated work undertaken with domestic clients.
This year we have added sections on the following practice areas: corporate tax expert witnesses, trademark attorneys, due diligence accountants, competition economists, patent agents, arbitration expert witnesses, investigations forensic accountants, investigations digital forensics experts, e-discovery practitioners, construction expert witnesses and asset recovery experts. The e-discovery chapter contains 20 listings, and serves to reflect the diverse multidisciplinary nature of the movement which began in Canada back in 2006. Still in the early stages of development, more and more firms are creating and building up teams specialised in the field to assist their litigation departments. The expansion of practice areas included in our research is testament to the ever-growing Canadian legal market. It is representative of the collaborative role of different practitioners within the legal system, and their presence in a broad range of sectors. This trend is particularly noteworthy in the field of patent law, where in our 2015 edition on the sector, we list 695 patent lawyers and 164 patent agents. In this edition on Canada, the ratio of lawyers to agents in this practice area differs greatly from the global overview, with 38 lawyers and 40 agents. Such statistics are indicative of a highly active and competitive patent legal market in Canada, which evidently requires a substantial amount of expert assistance.
In the following pages we will highlight the leading Canadian firms, with information on their practices and activities in this last year. Blake Cassels & Graydon once again emerges as the leading Canadian law firm in our research, with a total of 115 listings, a distinct improvement from last year. Overall, our research covers the work and performance of almost 1,500 Canadian lawyers across 46 practice areas.