BRITAIN’S lawyers are reaping huge profits with a record £10.8 billion billed in legal fees by the top 100 corporate firms this year.

Lawyers personally made a collective profit of £3.5 billion, up by 20 per cent on the year before, according to a survey yesterday.

Profits per partner hit a record £1,160,000 in one top City law firm, Slaughter and May, while the average profit across all 6,557 partners in the top 100 law firms reached £537,322.

The year also saw the arrival of the world’s first £1 billion law firm — Clifford Chance, which billed £1.030 billion in legal fees during 2006.

The huge figures indicate the massive earnings to be made among commercial law firms from handling mergers, acquisitions and tax matters for company clients.

They show that while their legal colleagues doing criminal and family legal aid work manage on far less, the corporate lawyers have never had it so good.

Law firm billings have steadily risen over the past nine years from £4.34 billion in 1997 to a “staggering” £10.8 billion in 2006, the survey finds.

Jim Baxter, Editor of Legal Business, the magazine that ran the survey, said: “The firms generated £10.8 billion revenue, with 6,557 partners sharing £3.5 billion of profit. For many, the take-home pay package will be simply eye-watering.”

The so-called “magic circle” of Britain’s top law firms — Clifford Chance, Freshfields, Linklaters, Slaughter and May and Allen & Overy — still dominate the legal market.

Together the six generated total revenues of £4.1 billion in 2006, accounting for 38 per cent or 38p in every pound spent on legal service among the top 100 firms.

In terms of turnover, Clifford Chance heads the earnings league table with profits of £312.7 million to be shared among its partners. That works out at £810,000 per equity partner, a rise of 26 per cent.

However, the most profitable place to be is Slaughter and May, whose equity partners enjoyed a 21 per cent rise in profits, taking home £1,160,000 each.

The biggest rise in profits came at Lovells, up by 34 per cent, with profits per equity partner reaching £572,000.

The only large City firm to see a fall in billings was Denton Wilde Sapte, where billings were down by 4 per cent to £147.5 million.

In all, the top 100 commercial law firms employ 42,827 lawyers. However, the golden prize of a partnership is becoming harder to obtain.

Mr Baxter added: “These lawyers are working harder and more efficiently than ever, producing greater profits for equity partnerships that are becoming harder to join.”

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