Wednesday, 23 March 2011 14:37

Law Schools Need to Create New Types of Graduates

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This Wall Street Journal article and this New York Times article illustrate a recent trend of college graduates deciding not to go to law school. These articles point out a troubling truth about the legal profession: The expense of law school makes it nearly impossible for a law school graduate to provide services at a price the average person can provide. When law students are graduating with over $200,000 in debt, the only way to repay that debt is to work for large law firms that serve large corporations and rich individuals.
 
Reducing the cost of the legal education required to serve customers would help lower the cost of legal services. This could take place in a couple of ways. The obvious one is that lowering the cost of a J.D. would allow recent law graduates to provide affordable services while still paying off their educational debt. A more innovative approach would allow limited licensure of people with fewer years of formal legal education. For example, a state could grant a license to perform simpler legal tasks based on testing and one or two years of law school. Or lawyers could be licensed to practice only in a specific field after taking the first-year legal curriculum plus a semester or two of course work in that area. Consumers are rarely served well by one-size-fits-all services; the legal academy should stop creating one-size-fits-all graduates.
Sunday, 20 March 2011 20:00

Legal Services Should Not be Luxury Purchases

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According to The Wall Street Journal, The New York Times, and Forbes, the divorce rate has declined during the recession. Why? Because it has become too expensive for many Americans to get divorced. As a lawyer quoted in Times quipped: "Why is a divorce so expensive? Because it's worth it," adding that in our current economic climate, "now it better really be worth it." But the expense of exercising such a basic legal right is hardly a joke. And if you can't afford to file for divorce, it is a safe assumption there are other legal rights you also can't exercise.

Although the increasing cost of legal services is gaining attention due to the recession, we should not attribute the trend to the recession. Basic legal services have always been priced out of reach for most Americans. Our rights as individuals are only as real as our access to the legal services allows us to protect or exercise them.

Having the legal right to get divorced means nothing to a couple who can't even afford to consult with an attorney to learn about that right, let alone begin the process. It speaks volumes about the deep-seated flaws of legal system that, in a time of recession, something as basic as getting a divorce should be be inaccessible to working people.

Our economy will eventually rebound, but the basic inequalities that exist in our legal system will persist unless we take steps to empower all Americans to take command of their legal rights. Access to one's legal rights should never be a luxury.

A member of the North Carolina Senate has introduced a bill that would promote the delivery of innovative legal services. Senate Bill 254 would allow non-lawyers to own a minority stake in law firms. As we mentioned in our previous post, outside investment in law firms could provide them the capital they need to innovate and find ways to serve consumers better. Some lawyers have claimed that non-lawyer ownership could compromise their ethical duties to their clients or to the courts. However, the bill would protect consumers by warning non-lawyer owners that duties between shareholders do not trump duties to clients. If passed, the bill would be a first step toward helping the legal profession join the rest of the economy in providing integrated and innovative services. We urge the North Carolina legislature to pass SB 254 and encourage other states to introduce similar legislation.

 

A recent survey found that 60 percent of British consumers would consider buying legal services from a nationally known brand such as Barclays or Virgin. Although we know of no comparable study for American consumers, we expect that their preferences would be similar. Unfortunately, legal ethics rules prevent non-lawyers from having an ownership interest in a law firm, preventing national brands from taking root in the US. This prohibition is unfortunate, not because large non-lawyer corporations would necessarily provide better legal services than law firms, but because outside investment could be the key to making legal services available to the general public.
 
Outside investments could provide lawyers with the capital to pursue innovations in the delivery of their services. It could also allow companies providing services related to legal services to join forces with lawyers to provide one-stop shopping for consumers seeking both legal services and other services related to the same transaction. For example, a consumer could go to one company that could provide financial planning services and also draft her will.
 
The restriction on non-attorney ownership of law firms stands between consumers and the innovations that could help them obtain legal services less expensively and more efficiently.

A recent New York Times article describes advances that allow computers do much of the work lawyers do in complex litigation where there are millions of documents and emails that need to be reviewed before trial. But computers can also help simplify everyday legal matters such as wills, divorces, and bankruptcies.

Information gathering is good example of a task that computers do well. In corporate litigation, sophisticated software applications relieve lawyers of having to spend many tedious hours sifting through e-mails. Similarly, legal software for consumers can flawlessly execute a checklist of questions designed to gather the right information and then complete forms that many people would have made mistakes on their own.

In both cases software allows lawyers to focus on what they do best: legal analysis and strategic planning. In the corporate scenario, more of the client’s money goes toward these higher-end functions because the computer gathers information not junior associates who bill hundreds of dollars an hour. In the consumer scenario, software can enable a person to draft their own document rather than paying a lawyer or paralegal to do the same task. The resulting savings can then be put toward hiring a lawyer to review their document. It is worth noting that because many people cannot hire a lawyer at all, the alternative to software-assisted legal drafting is having no assistance at all.

In the 1999 case Unauthorized Practice of Law Committee v. Parsons Technology, a federal court held that Quicken Family Lawyer software was acting as a “cyber-lawyer” and therefore violated the state’s Unauthorized Practice of Law statute. The Texas legislature quickly passed a bill amending the statute. We hope that, as legal software becomes more sophisticated, the legal profession will continue to recognize the valuable role computers can play in increasing consumers’ access to justice.

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