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ABA commission sees need for ‘regulatory innovations’ in legal profession

August 8, 2016

Finding the need for legal services among the poor and moderate-income greater than legal aid and pro bono can satisfy, an American Bar Association commission is advocating for the consideration of “regulatory innovations” which include non-lawyer ownership of legal service providers.

The ABA Commission on the Future of Legal Services released its findings and suggestions Friday for providing legal assistance to those who cannot afford an attorney. A product of two years of study, the 96-page “Report on the Future of Legal Services in the United States” offered 12 broad recommendations ranging from embracing technology for the delivery of legal services to putting more resources into traditional legal aid and pro bono efforts.

“The legal profession, as the steward of the justice system, has reached an inflection point,” the commission stated in the report. “Without significant change, the profession cannot ensure that the justice system serves everyone and that the rule of law is preserved. Innovation, and even unconventional thinking, is required.”

Driving the need for change is the growing numbers of those who do not have access to affordable legal services.

The commission found that most people living in poverty and the majority of moderate-income households do not receive the legal help they need. Largely, these individuals either cannot afford a lawyer or they do not realize their problem requires the help of an attorney. In addition, the traditional business model of law offices constrains innovations that, the commission maintained, would enable greater access to and enhance the delivery of legal services.

Among the recommendations is the call for the continued examination of alternative business structures. In an issues paper released in April 2016, the commission noted these structures typically allow non-lawyers to own law firms, invest in law practices or operate as a multidisciplinary practice which provides both legal and non-legal services.
 
Reaction to the issues paper was strong and divided.

The ABA Section of Family Law provided a two-sentence response that asked, “WHAT PART OF ‘NO!’ DO YOU NOT UNDERSTAND? We remain unalterably opposed to these repeated, previously failed efforts to foist ABS upon on profession or our ethics.”

Similarly, the Illinois State Bar Association raised concerns about the effect non-lawyers would have on the core values of the legal profession. The ISBA feared the pressure would increase on generating a greater profit which would reduce individualized care while reducing the desire to take on unpopular causes or do pro bono work.

On the other side, LegalZoom and Avvo supported easing regulations.

In a 10-page response, LegalZoom asserted, “It is time to examine the system that lawyers created and practice in, and the self-granted monopoly that lawyers legislate, regulate and adjudicate. If the profession can look past the fear-mongering of entrenched Luddities, and re-look (at) the purpose behind what has become innovation-crushing regulations to address supply, not only will the industry see quantum leaps in legal access, it will see a call for more, not fewer, lawyers!”

The ABA Business Law Section’s Ad Hoc Working Group on the Future of the Delivery of Legal Services applauded the commission for exploring innovation proposals. It also underscored the need to not only provide legal assistance to the public but also to ensure consumers are protected.  

“There is a clear recognition that changes are in the wind and that it would be a disservice to our profession and the public to not provide for a structure for change,” the Ad Hoc Working Group wrote.

The ABA Commission on the Future of Legal Services acknowledged the opposition to alternative business structures. However, it pointed to studies from the United Kingdom and Australia that have shown that these structures have not harmed clients and consumers nor deteriorated lawyers’ ethics or professional independence.  

The commission reiterated that ABS should continue to be explored and, in conjunction, that data should be collected to further assess the risks and benefits.

On a related issue, the commission also advocated for states to explore the increasingly wide array of entities that employ new technologies and internet-based platforms to provide legal services directly to the public. Although conceding these businesses operate without the oversight of courts or judicial regulatory authorities, the commission advised caution and careful study before adopting any new rules.

Greenwood, Indiana, attorney Patrick Olmstead Jr. responded to the issues paper that was submitted on the legal service providers. He maintained that any company offering legal services should be subject to the Rules of Professional Conduct and be liable for professional negligence.

“Although most of my information is anecdotal, I believe that some clients suffer harm because documents with legal consequences are drafted poorly or the documents were not suitable for the client’s situation,” Olmstead wrote. “If a lawyer drafted those documents, the lawyer could be liable for negligence. I would like to see these legal services companies held to the same standard of care as attorneys, and follow the same rules governing lawyers, to protect the public.”   
 

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