What Impact Does COVID-19 have on the Legal Field?
The spread of coronavirus has affected many aspects of our everyday lives. Countries have closed their borders, restaurants and gyms have shut their doors, and wearing a mask has become a requirement in many countries across the world. Clearly, the novel virus has impacted businesses in many ways, and has completely changed the way in which they can operate. Many companies have experienced extreme financial difficulties, forcing them to declare bankruptcy and to potentially close their doors forever. It should come as no surprise that the world is currently in a global recession. But how has the legal industry been impacted by the virus? Which practice areas are falling short, and which ones are thriving? Are firms managing to stay afloat with the current services they offer, or are they expanding into new practice areas as demand shifts?
Bankruptcy and Insolvency
As businesses were forced to shut as per government regulations, generating revenue became a challenge. Many found themselves insolvent as the situation continued to worsen and could not get back on their feet. While this is devastating news for any business, bankruptcy and insolvency law firms saw a huge increase in demand. With companies finding themselves in more debt than ever, they are turning to bankruptcy lawyers to help them through the difficult situation. Although the spread of coronavirus has interrupted their usual business practices, it is normal that most business owners would like the opportunity to start anew, and therefore seek help from a lawyer.
With the inability to attend court in-person, litigation was put on hold as the country was declared to be in lockdown. Scheduled court dates were postponed, but given the confusion and uncertainty of the situation, many companies are arguing that their contracts did not include clauses to cover the current situation. Further, insurance companies are claiming that their policies were not constructed to cover issues related to coronavirus. With many disputes needing to be resolved, the courts will inevitability find themselves with excess of cases if litigation does not continue.
Mergers and Acquisitions
A merger or acquisition can be a very strategic move for a business. Have you ever heard of the saying “two heads are better than one”? Mergers and Acquisitions replicates this idea in the context of business, as it rests upon the idea that two separate companies together can create more value than one company on its own. However, with the lack of transactional activity resulting from coronavirus, mergers and acquisitions has subsequently experienced a decrease in its activity level.
These are only some practice areas that have been affected by the outbreak of COVID-19. Many other areas are experiencing very high demand, while others have been negatively impacted by the virus. Some law firms are attempting to expand their horizons and offer a wider range of services to ensure the stability and continuation of their firm.