Several recent articles, including this one in the New York Times have described the bursting of the law school bubble, with record low numbers of law school applicants in response to increasing tuition and declining job prospects for graduates. However, the United States is faced with a growing legal services gap, where only the richest Americans can afford the exorbitant hourly rates needed to hire a lawyer to help them with legal matters. With the demand for legal services increasing, why is there a decrease in the supply of people who can provide legal assistance?
The answer lies in the overly restrictive licensing system that governs who may provide legal assistance. Law schools are propped up by the requirement that anyone practicing law (with very few exceptions) be a graduate of a three-year law school program. "Practicing law" is defined so broadly in most states that it applies to anyone offering any kind of advice or service that has an impact on legal rights. Therefore, anyone who wants to make a career out of helping people with legal matters, no matter how simple, must pay for and attend three years of law school, or face prosecution for the unauthorized practice of law.
Want to help tenants with housing issues? Working for a tenants' rights organization and taking some courses in housing law would be a good way of learning the law and procedure regarding these issues, but without a J.D. you won't be allowed to give advice to a single tenant. Want to help people draft forms to write a will or get an uncontested divorce? You may have done so for twenty years as a paralegal working for a $300-an-hour lawyer, but without three years of education at a cost of over $200,000, you won't be allowed to offer those services directly to customers at a far lower cost.
To fix this disconnect between supply and demand, we need to allow a wider range of service providers, with training appropriate to the tasks they are performing. This could take the form of intermediate-level licenses for limited types of services. For example, a licensed social worker could be allowed to perform divorce-related legal services, either by virtue of her existing license or with some additional testing or coursework. California and Arizona (soon to be joined by Washington) allow licensed document preparers to provide services directly to consumers.
In the field of health, we don't require everyone to get a medical degree to provide services. Nurse practitioners, pharmacists, and physicians' assistants have less burdensome educational requirements. Massage therapists don't have any formal degree requirements and usually have a simple testing and coursework requirement for their licenses. Fitness trainers aren't required to have any licensing to guide people through exercise and diet regimens. In the field of law, however, we require everyone providing services to have a law degree. That's like requiring your massage therapist or your spin class teacher to have a medical degree!
If we right-size legal training to the types of services we're training people to provide, then the deflated law school bubble will consist of schools that train lawyers to deal with the most complex legal matters. At the same time, states could experiment with other models of licensing and training for simpler legal services, so that people with a desire to work in the field of law could be trained at a lower cost. These service providers, who would not face crushing law school debt, would be able to provide services to consumers at an affordable rate, easing the access to justice burden.
The New Jersey Supreme Court has adopted a rule supported by Responsive Law that will allow lawyers to practice in New Jersey without a physical office in the state. The rule could increase New Jerseyans' options in choosing a lawyer. For example, a person in Hoboken will now be able to choose from New Jersey-licensed lawyers located just across the Hudson River in New York City, and a person in Cherry Hill will now be able to choose from lawyers located just across the Delaware River in Philadelphia. New Jerseyans could also see the cost of a lawyer decrease due to the reduction in overhead for lawyers by not requiring them to maintain a full-time, fully-staffed office.
The rule maintains standards for lawyer responsiveness to clients, including a requirement that lawyers designate a location for inspection of documents by state regulators, and a requirement of prompt return of client calls, whether through voicemail, a third-party operator, or other means.
You can read our testimony to the New Jersey Supreme Court, which contains a more detailed description of the benefits of this rule. The rule takes effect on February 1, 2013.
On December 12, New York Governor Andrew Cuomo signed into law a bill making certain instances of the unauthorized practice of law a Class E felony, punishable by up to four years imprisonment. Responsive Law has generally opposed bills that increase penalties for UPL, as they usually exist primarily to support the lawyer monopoly over all law-related services. As a result, they work to the detriment of consumers by prohibiting them from using non-lawyer alternatives for less complex legal matters.
However, we did not oppose the New York bill because it is narrowly targeted at preventing fraudulent behavior that causes real harm to consumers. First, to trigger the felony provisions, a person must be impersonating a lawyer (i.e., using a title that implies they are a licensed lawyer), not merely offering law-related services. Second, felony penalties only apply when there has been damages to another person of $1000 or more. This provision should prevent the bar from using the new law to attack its non-lawyer competition, as anyone providing real services to consumers will not have caused damages to anyone.
The new law goes into effect in November 2013. We hope that prosecutors and the bar will recognize that the intent of this legislation is to prevent consumer harm and that they will not stretch its provisions to protect the lawyer cartel.
Professor Gillian Hadfield at the University of Southern California, who has produced excellent work on access to justice issues in the past, has just released a brilliant piece that systematically addresses the issues that keep legal costs high and out of reach for so many. She subsequently followed this up with a piece for CNN. This posting is just an overview, we encourage you to read the whole piece.
As Professor Hadfield notes, the problem of legal access in the US is not an issue that only impacts the poor. It is not the result of insufficient government funding or lawyers’ unwillingness to volunteer. Indeed, while boosting legal aid budgets and getting lawyers to do more pro bono work would be positive steps, these solutions are ultimately insufficient to address the problem. Rather, the problem is one of cost. The average hourly rate for an associate attorney is $190 and for a partner it is $285. This makes consultation over even routine legal matters, like signing a rental contract or responding to credit difficulties, prohibitively expensive. These costs mean that attorneys’ expertise is only employed in the most extreme cases, burdening the court system with long and expensive litigation that could have been resolved at an earlier stage. Imagine the incredible burden on the medical system, which Professor Hadfield frequently uses as a point of comparison, if high costs forced consumers to leave their problem unaddressed until it required a trip to the ER.
The reasons that legal costs are so high, Professor Hadfield argues, has nothing to do with supply: there are many competent lawyers out there capable of competing with each other. The problem is structural. Any given legal issue is incredibly complex, with huge sunk costs such as the cost of getting a legal education and certification, as well as the costs in money and time needed to research, investigate and form a response to a given issue. However, the regulatory structure of the industry prevents the innovation and specialization necessary to develop tools to respond to these issues more quickly and cheaply.
One model that Professor Hadfield suggests the legal profession look to is that of medicine. Since the 1970’s the medical profession has moved away from rigid professional requirements, allowing doctors, hospitals, insurance providers, nurse practitioners and specialists to collaborate in a variety of areas. This has allowed innovations in everything from medical research to how patient information is transferred and has reduced costs. But unlike the medical industry, the current codes of professional conduct largely prohibit what Hadfield calls “the corporate practice of law.” Hadfield defines this as the ability of any organization other than a law office, owned and managed by attorneys, to provide legal services. These organizations need not be private corporations, but also include non-profits, charities that provide legal aid themselves, unions that supply attorneys to their members or schools that offer legal advice to students. Although these organizations often employ or consult with competent and licensed attorneys, nearly every state prohibits every form of providing legal services that is not wholly owned and managed by lawyers.
This system forces lawyers to be involved in the business aspects of legal practice like securing office space, hiring staff, collecting bills and marketing their services. This is on top of the costs of paying off their considerable law school debts and securing the loans necessary to finance all of these operations on their own. These costs necessarily cause prices to rise.
Moreover, cost saving innovation is stunted in the critical area of developing products that help deliver legal services. These delivery products do not necessarily impact the substantive law or the legal options that an attorney can actually suggest to the client. Rather, delivery products change the way those underlying legal issues are researched, drafted and ultimately made understandable to the client. In other words, improving access to legal delivery doesn’t change which forms you need to fill out in a divorce, but changes how you would find out which forms you need and how you would get a copy.
If attorneys were allowed to collaborate with other organizations to develop and employ new methods for areas like legal research, client advertising, meeting continuing legal education requirements, and developing an easy to use delivery system to get legal information to clients, the resources necessary to address a given legal matter would decrease and could be deployed more efficiently. But currently, everything must be done by an organization owned and financed by a lawyer. Having lawyers devising advertising strategies to bring in clients instead of focusing on legal analysis is not an efficient use of legal resources. It also places huge burdens on small firms and single practitioners. By changing standards to allow the corporate practice of law, a change Responsive Law supports, other organizations and businesses could work with attorneys to provide and deliver legal services. This would allow cases to be processed more cheaply and quickly, providing the consumer with a better product.
The ABA’s Ethics 20/20 Commission, which Responsive Law has been closely following, has largely neglected reforms in this area. As Professor Hadfield notes, the ABA has largely ignored the scale of the cost problem and focused its attention on traditional remedies like increasing legal aid budgets. If the ABA wants to address the crisis of legal access seriously, it would do well to deeply consider Professor Hadfield’s work and not overlook the issues surrounding the corporate practice of law.
Will Downes, a law student at Georgetown University Law Center, is a Responsive Law intern.
As much of the Northeast continues to recover from Hurricane Sandy, aid organizations have mobilized to help the victims of the storm begin to rebuild their lives. One area that often gets overlooked in disasters like this is the issue of legal needs. Sadly, the progress toward creating a system to make pro bono legal aid more accessible in the aftermath of a storm has been uneven.
Hurricane Katrina demonstrated that large natural disasters impact a region’s legal services in two primary ways. First, the devastation creates a tremendous strain on the legal system by increasing the number of legal issues. Disasters overburden the system as victims begin to file insurance claims, experience landlord-tenant issues and have disputes over construction contracts to name a few issues. At the same time, disasters deplete the legal infrastructure in place to deal with these issues. Mass evacuations and damage to communications infrastructure mean that lawyers are separated from their clients and staying in contact is difficult. Law offices may be damaged, inaccessible or without power, meaning that lawyers no longer have access to the relevant documents or the ability to keep track of their cases. Finally, courthouse closures can slow the system even further, leaving vulnerable people in a state of legal limbo.
Understanding these difficulties, many lawyers from across the country offered to take pro bono cases in the Gulf in the wake of Hurricane Katrina to help as the devastated justice system begin to rebuild. However, these efforts ran into initial difficulties because of Louisiana and Mississippi rules limiting the ability of out-of-state attorneys to take cases. Although the Supreme Courts of both states eventually adopted temporary rules that allowed more out-of-state aid in, this episode exposed a major deficiency in the emergency legal aid system. At a time when whole communities are devastated and people everywhere are eager to help, lawyers should not be prevented from contributing their services because of a formalistic regulation.
Since then, the American Bar Association has responded by adopting what is known as the “Katrina Rule” in 2007. The model rule is more flexible and allows out-of-state attorneys to take certain cases on a pro bono basis in the aftermath of disasters. To their credit, 16 states have adopted this rule into their own judicial systems as of July of 2012. However, the pace of reform has been uneven. Implementation is still pending in fifteen states and eight states have actively decided not to adopt this rule.
This delay and outright rejection of this type of reform is morally inexcusable in the face of devastation from a storm such as Sandy. While New York, New Jersey and Delaware have all adopted a version of the rule, Maryland is still considering adoption and Pennsylvania had already actively rejected the rule. The normal justification for unauthorized practice of law restrictions that prevent anyone but in-state attorneys from practicing is a concern about scam artists and unqualified attorneys. But these circumstances do not apply given the limited and regulated way pro bono work is allowed under the rule. In the face of so much human suffering, no resource for attending to the victims needs should be constrained by arbitrary rules. It is simply wrong to turn away willing volunteers from a disaster area that could desperately use their help.
Will Downes, a law student at Georgetown University Law Center, is a Responsive Law intern.