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LEGAL REPORT: INSOLVENCY Business solutions for boardrooms Lawyers are getting creative to help clients get out of financial jams in recession's wake. BY GEOFF K IR BYSON Davis LLP was called to the bar in 1986 after graduating from law school but he spends a decreasing proportion of his time in a courtroom. Instead, he's increasingly brandishing his skills as a provider of business solutions in his cli- ents' boardrooms. In the aftermath of the fall 2008 J market crash and subsequent recession, Fogarty says lawyers have been forced to become more creative in getting their clients out of financial jams. In the past, there was generally another buyer out there for a distressed company or a financial institution that was prepared ustin Fogarty is not your father's restructuring and insolvency lawyer. Sure, the Toronto-based partner at to lend or invest money. Not anymore, he says. "We're really focusing on selling our services not as bankruptcy-insol- vency lawyers but as business-solutions lawyers," he says. Fogarty says he and the team at Davis' business solutions and restructuring group need to be more tuned in to troubled companies' needs and options that are unrelated to insolvency. This includes minimizing taxes, selling off non-profitable businesses, finding new sources of capital, finding new markets, and improving liquidity. "Because busi- ness is moving so quickly, the insolvency bar has had to evolve and work with the merger and acquisition and lending bars to use their skills to find solutions to problems, such as finding equity invest- ors, restructuring of debt by getting banks to take equity positions or exe- cute forbearance arrangements," he says. "These were options that might not have been at the top of the list before because there was another buyer [waiting in the wings]. We don't have as many quick fixes available to us as we did before." Before the economy hit the skids, companies were still going out of busi- ness but for different reasons — the competition was too strong, their oper- ations weren't being managed properly, or because demand had disappeared and the business had come to the end of its natural life. There was usually some form of exit strategy provided to www. C ANADIAN Law ye rmag.com JUNE 2010 45 JOEL KIMMEL