By Graeme Strachan

A LEADING Tayside law firm is to make up to a quarter of its workforce redundant—and blamed the credit crunch for the bleak news.

Blackadders Solicitors, which has 240 partners and staff, anticipates between 40-60 job losses across the firm, affecting fee earners and support staff.

The announcement comes after months of uncertainty in the housing market.

Managing partner Johnston Clark told The Courier the firm has been left with no alternative because it does not anticipate the market will pick up enough within the foreseeable future.

He said yesterday’s decision to announce a redundancy programme was the “human cost of irresponsible bank lending over the years.”

The Dundee firm has seen a slowdown in the time it is taking for properties to sell and it is thought the market will not see any recovery until at least 2010.

Mr Clark said this was a result of the credit crunch and the effect that it has had on mortgage lending, which has impacted significantly on the estate agency, residential and commercial conveyancing practices.

“It all just very suddenly happened,” said Mr Clark.

“Northern Rock was the start of it and lenders began tightening their belts. At Christmas we started to see people finding it difficult to get credit.

“Shares in Bradford and Bingley were down this afternoon after it revealed profits fell by half last year and the global credit crisis triggered a bigger-than-expected write-down of £226m.

“The credit crunch hit lenders hard and inevitably had a knock-on effect on the property market with a slump in the number of people buying new homes. Both volume and price have been affected.”

He added, “Announcing a redundancy programme is not an easy option but we have reluctantly concluded that market conditions will not recover to previous levels within the foreseeable future.”

Blackadders will now begin consultation over the proposed cuts.

One employee said last night that staff were still coming to terms with yesterday’s shock news.

“Nobody knows if they’ll be staying or going,” she said.

“Everybody’s shocked because it’s come out of the blue—we were given the news today and it’s now just a case of wait and see.

“There’s a lot of property on the market not moving because of the credit crunch.

“Sellers are getting the jitters and buyers are struggling to get a mortgage. That has obviously had an effect on business but it’s still difficult to take in.”

The credit crunch has resulted in borrowers struggling to borrow.

Lenders are demanding bigger deposits, cleaner credit records, and higher interest rates.

Low-cost tracker and fixed rates have all but vanished along with 100% mortgages.

Solicitors’ firms across the country have been forced to cut jobs as a result of the credit crunch.