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The State Bar of California has established the Governance in the Public Interest Task Force to help improve the public protection function of the State Bar. California law holds the protection of the public as the State Bar’s highest priority. Responsive Law believes that unchecked self-governance by lawyers is not in the interest of the public, and issued comments offering guidelines that would better protect the public.

 

After the North Carolina Board of Dental Examiners v. Federal Trade Commission case last year, state bar associations have found themselves vulnerable to antitrust suits, and the State Bar of California is no exception. For a full analysis of the Dental Examiners case click here. Subject to approval by the California Supreme Court’s approval they can pass regulations that restrict the practice of law by even highly trained non-lawyers. While the State Bar argues that these restrictions protect the public, many of the state bar’s members support these measures as a way to protect themselves from competition.

 

Many state bars claim that they are exempt from antitrust liability because they are supervised by the courts, which are a branch of government. However the justices on the California Supreme Court are required to have been practicing lawyers for ten years before becoming justices, and most return to private practice after their terms end. It is against the public interest for these justices to be making decisions on regulations that will directly affect their financial interests when their term is over. Furthermore, under FTC guidelines, they still count as active market participants, which means that antitrust liability would still apply to the Bar’s actions.            

 

To resolve this conflict, California should grant a non-judicial agency oversight of any anti-competitive actions proposed by the State Bar. This would make the State Bar more accountable to the public.

 

Responsive Law urges the State Bar of California to recognize that the public cannot have a say in how they receive or pay for legal services unless the protectionist impulses of lawyers are curbed by an agency without a financial stake in allowing such impulses.

 

To read Responsive Law’s full testimony click here.

 

James Duffy is a Responsive Law Intern.

           

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In November 2014, the California State Bar Board of Trustees approved the creation and appointment of the Civil Justice Strategies Task Force. The charge of the task force was to analyze the reasons for the state’s justice gap: the conundrum of how there are so many lawyers yet so many Americans have unmet legal needs and cannot afford or access legal help. Specifically, the task force intended to study creative solutions and innovative strategies in use by other states and other countries that have the potential to greatly improve access to justice in California.

Responsive Law sent an array of innovative and creative solutions to the Civil Justice Strategies Task Force. We advised the task force to allow for alternative business structures to address the justice gap. Alternative business structures entail permitting outside investors to provide capital to legal service companies or allowing non-legal companies to partner and share fees with a legal organization. Both the United Kingdom and Australia have allowed legal entities to accept outside investment from non-lawyers; yet no state in the U.S has done so due to unfounded concerns that outside investment will lead to an increase in unethical violations by lawyers. 

We specifically recommended that California allow outside investments in the growing number of legal startups that already exist in their state. We highlighted the fact that pro-bono services and legal aid literally do not have the capacity to provide even half of the unmet need for legal services. Thus, California needs to invest in creating a larger array of affordable legal services via outside investment in legal startups.

We also recommended allowing more non-lawyers to provide legal help to consumers. We cited the launch of limited license legal technicians (a regulated profession of non-lawyers who provide document preparation and other legal assistance) in Washington state. We also recommended the proven strategy of limiting the breadth of unauthorized practice of law claims (UPL). Research has shown that UPL cases are brought mostly by lawyers, for anti-competitive reasons, as opposed to a dissatisfied customer. As Responsive Law has noted before, such aggressive UPL enforcement chills legal innovation. Specifically we proposed that the task force create a safe harbor provision for document preparation similar to the one in Texas that has helped to provide many Texans with access to self-help tools. We also encouraged the task force to again look to the United Kingdom where non-lawyers referred to as McKenzie friends have operated for the past 50 years providing court navigation help, moral support, case paper management and advice on courtroom conduct for free or for a small fee.

Lastly, we encouraged the task force to take the lead (as opposed to waiting for other states) by launching a compact with other states to allow for multi-jurisdictional practice similar to what exists in Canada. In Canada, a lawyer can practice in any province; allowing multi-jurisdictional practice allows for greater competition in the provision legal services and more lawyers and law firms to reach economies of scale. Thus the strategy of multi-jurisdictional practice could provide Californians with unprecedented access to lawyers. We believe California is off to a good start of addressing their growing access to justice gap; the strategies and solutions we have recommended will supercharge California’s potential to actually close the justice gap.

You can read our comments to the California Bar here.

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Currently, California is one of the many states in this country that has issues providing access to adequate and affordable legal services. Legal document assistants, or “LDAs”, assist self-representing parties in preparing legal documents. They help to reduce the issue of expensive or inaccessible legal representation, as they can act to provide limited legal assistance to parties that either do not need to hire an attorney or cannot afford to do so.

The problem remains, however, that LDAs are encumbered by regulations that burden their work: specifically, LDAs must register in each separate county they provide services in. The process of registering in each county becomes expensive, and the consumer ultimately winds up subsidizing the incurred costs. This regulation is also problematic in that it deters LDAs from offering their services in multiple counties, which restricts consumers’ access to this service. Moreover, these regulations are purposeless; they do not serve to protect the consumer.

Responsive Law’s recently submitted testimony in support of California Assembly Bill 285, which would eliminate this burden, thus facilitating greater consumer choice among LDAs. The provision of AB 285 that will be most helpful to consumers provides for statewide—as opposed to county-by-county—registration for LDAs. Not only would AB 285 eliminate this costly and time-consuming limitation on LDAs, but it would also enable them to branch out and provide services throughout the state. In short, AB 285 would benefit the consumer in the long term by allowing greater access to a legitimate, cost-effective legal service.

On May 26th, AB 285 passed the California Assembly and is awaiting consideration by the Senate.

Emily Iannucci is a Responsive Law intern.

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Last year, the California legislature passed an atrocious UPL bill, Assembly Bill 888. You can read the details here and here, but the gist of it is that AB 888 would have greatly increased the autonomy and power of the State Bar in initiating UPL proceedings. It would have fed the Bar attorneys’ fees and fines, and was a blatant attempt to smother the nascent non-lawyer legal services industry with the threat of a barrage of UPL suits.

Fortunately, Governor Brown vetoed the bill, noting that existing consumer protection mechanisms in California are adequate to address the ills caused by UPL. We would have added that AB 888 was cynically waving the flag of consumer interest to support a bar-centric power and cash grab, but it’s hard to fault the governor for being diplomatic about his opposition.

Now AB 888 is back. Assembly Bill 852, from the makers of AB 888, is the same bill with a new paint job. The bill’s supporters have repeatedly misrepresented the contents and implications of AB 852. Supporters have falsely claimed that AB 852 has removed the provision awarding attorneys’ fees to the bar; it has not. Supporters claim that the governor’s objections have been taken into account; they have been sidestepped and ignored. Supporters of AB 852 claim that the bill is intended to protect the most vulnerable consumers in California’s legal services marketplace; in reality, AB 852 would stifle less expensive alternative sources of legal services, giving the bar increased power and financial incentive to enforce their stranglehold on the industry.

AB 852 is still in California’s legislature, but given the passage of AB 888, Responsive Law was not about to stand idly by. We wrote to California Governor Jerry Brown, urging him to veto AB 852 should it cross his desk. The California Bar and its allies in the legislature have attempted to pull a fast one on the Governor and on the people of California, apparently under the mistaken impression that no one will check their statements against the actual contents of the bill. We hope that the Governor, who was so astute in vetoing AB 888, will take a close look at AB 852 and veto it as well. Perhaps this time, the bill will stay dead.

You can read our letter to Governor Jerry Brown here.

 

 

Danny Foster is a Responsive Law intern.

Published in Blog
Sunday, 13 October 2013 00:00

CA Governor Vetoes UPL Expansion

California Governor Jerry Brown has vetoed Assembly Bill 888, which would have given the State Bar of California additional incentive to pursue civil lawsuits against those it considered to be engaged in the unauthorized practice of law.If the bill had been signed into law, the bar would have allowed the awarding of attorneys fees to the br when it successfully sued its economic competitors. Service providers such as legal document assistants, tax preparers, and financial planners would have all faced a strong disincentive to provide their services to consumers, under threat of a lawsuit from the bar and the possibliity of paying both damages and lawyers' fees should they lose such a suit.

Responsive Law led the effort against passage of AB 888. Its testimony led to amendments to the bill which would have required money the State Bar received from UPL cases to go toward victim restitution, rather than to the general treasury of the State Bar. However, the bill still did not require a showing of actual consumer harm for a court to find that UPL had occurred. Since Responsive Law believes that any UPL case that does not involve consumer harm is merely economic protectionism for lawyers, we refused to drop our opposition to the bill. Governor Brown's veto message noted that the State Bar and state and local prosecutors already have sufficient power to enforce UPL law, indicating agreement with our position that this bill was a power grab by the State Bar, and not an honest attempt to protect consumers.

You can read Responsive Law's testimony opposing AB 888 here, or our previous discussion of this legislation here.

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An American Bar Association task force has recommended that state regulators license people other than lawyers to perform certain legal services. In a recently released working paper, the ABA Task Force on the Future of Legal Education stated, “State regulators of lawyers and law practice should undertake or commit to … authoriz[ing] persons other than lawyers with J.D.’s to provide limited legal services and create certifications for such persons.”
 
The state of Washington has already begun to implement a program to license non-lawyers and California is considering doing so as well. A recommendation from the ABA that such programs be created could go a long way toward expanding this additional avenue of access to the legal system nationwide.
 
Of course, the release of a working paper is several steps removed from a nationwide change in policy. Even if these recommendations remain in the task force’s final report (due on November 20), there is no guarantee that the ABA House of Delegates will adopt it as ABA policy. Numerous consumer-friendly proposals about lawyer regulation have received strong support from ABA committees and task forces, only to be shot down by the House of Delegates. And even if the ABA endorses this proposal, each state will be free to accept or reject it in setting its own policy with regard to non-lawyer licensure. Local bars are sure to put up a strong fight over what they may see as non-lawyers infringing on the turf of lawyers.
 
Nevertheless, this is a significant development in the expansion of legal services to all Americans. If non-lawyers provide simpler legal services, the cost of those services will drop, potentially to a level where they would be affordable to the vast majority of people in this country who cannot currently afford legal help. If nothing else, the coalescing opinions on this point among a group of distinguished lawyers and judges shows how far the legal establishment has come. It appears that at least one segment of the legal establishment recognizes that it is irrational to continue the decades-old monolithic way of educating lawyers that produces newly-minted lawyers who are incapable of providing the legal services that most people need.
 
The recommendation that limited practice licenses be created is also only one of several dozen recommendations that the task force has put forward. On nearly all of the issues it addresses, the task force has made thoughtful recommendations that would, if followed, give the legal education system the room it needs to experiment with new models that can help both potential legal service providers and their clients.
 

 

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The California Senate is considering a measure that will allow the State Bar of California to collect penalties from those who are found to have committed the unauthorized practice of law (UPL) in the state of California. This measure gives the State Bar a financial incentive to launch investigations—one might say witch-hunts—into economic competitors whom it claims are engaging in UPL. If passed, this provision will grant the State Bar a disproportionate amount of power and essentially set the stage for lawyers to dominate the legal field and prevail over any non-lawyer service provider who provides services even remotely linked to the law.

Beyond the undue amount of power that the bill will grant the State Bar, the measure will also have a chilling effect on non-lawyer service providers. Many other professionals, including legal document assistants, tax preparers, and accountants, often deal with issues that relate to the law. However, these professionals will be deterred from providing some of their services as a result of an increased threat of being found liable for UPL. If there are fewer service providers available, consumers will suffer since there will be fewer options available to them when they need help with problems that have a legal component.

The State Bar claims that the bill will prevent fraud. This is unpersuasive, as state consumer fraud law already has measures in place to penalize those who fraudulently represent themselves as lawyers despite not holding the correct qualifications. In addition, prosecutors are already free to pursue criminal cases of UPL. This bill doesn’t give consumers any additional recourse; it only gives new powers to the State Bar.

UPL enforcement has historically been a tool for lawyers to limit their competition, rather than a means to protect consumers. Only two percent of UPL cases involve actual consumer harm. But even if the State Bar is truly concerned with protecting consumers, then it would make sense for the penalties paid by those found liable for UPL to benefit the victims, rather than to financially enrich the State Bar. Instead, every dollar the State Bar is awarded from UPL defendants will be a dollar that those defendants could not pay to any actual victims of UPL.

The California Senate Judiciary Committee will hold a hearing on the bill, Assembly Bill 888, on June 25. To learn more about the bill’s potential impact, read our testimony to the Judiciary Committee.

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Please read this blog entry from Kat Mountjoy, a board member of the Alliance of Legal Document Assistant Professionals. ALDAP is one of the membership groups supporting California legal document assistants by promoting professional responsibility within the profession and generating awareness of the profession among the public.

Kat operates two businesses, an LDA business, which is regulated under California's LDA statute, and a bankruptcy petition preparation business, which is regulated under federal bankruptcy law. A federal bankruptcy trustee took Kat to court because she uses the word "legal" in the name of her LDA business, not her BPP business. Kat's blog tells how she spent the day in court because the bankruptcy trustee either didn't take the time to recognize that she operates two separate businesses or didn't' understand the law he is supposed to enforce. It's particularly troubling that the trustee would spend resources on attacking an upstanding member of the LDA community when there are real scam artists out there trying to separate consumers from their money.

Published in Blog
Sunday, 12 September 2010 20:00

DIY Legal Software Reviewed in New York Times

Recently, the New York Times did consumers a great service by reviewing self-help legal products. That review can be found here. A follow-up blog post on the article can also be found here. While it's true, as was noted in the article and the blog, that not every consumer is best served by DIY software, not every consumer is best served by a lawyer either. Consumers are best served when there is a wide range of legal services available to meet the continuum of legal needs that they face.

What's missing in the current model of the profession is a wide selection of options between full service and self service. In medicine, nurse practitioners, physicians' assistants, and midwives are among the options that people can use when dealing with health issues. Unfortunately, the legal profession has very few professionals occupying this middle ground. More states need to follow the lead of California and Arizona in licensing legal document assistants and legal document preparers--non-lawyers with training to prepare simple legal documents. Also, lawyers need to be more innovative in providing mid-level services. For example, more lawyers need to make themselves available for review of DIY forms, or to draft documents for self-represented litigants, or to provide short coaching sessions to small claims litigants.

The bottom line is that consumers need more options in how to navigate a legal system that is too complex, and that they need to be educated about how to best use the services that do exist. That is why we're working to make the legal system more affordable and accessible for its users by educating consumers and influencing policy around the customer-friendly practice of law.

Published in Blog
Wednesday, 20 June 2012 20:00

Washington to Allow Non-Lawyer Providers

 

On June 15, 2012 the Washington Supreme Court adopted a groundbreaking rule which will allow consumers to use non-lawyers with certain training and education to provide technical help on simple legal matters. This Limited Practice Rule for Limited License Legal Technicians (“LLLT”) will be effective September 1, 2012 and is a monumental step toward increasing access to justice for Washingtonians.  The purpose of the rule is to authorize certain persons to render limited legal assistance or advice in approved areas of law.

This rule was a product of the Washington Practice of Law Board, which was created to handle unauthorized practice of law (“UPL”) complaints. In other states, UPL committees are dedicated to defining and investigating complaints for UPL. Such investigations often cause more harm than good to consumers, as they sweep up useful service providers alongside fraudulent ones. However, rather than blindly cutting off non-lawyer services for consumers, this UPL committee focused on finding ways in which access to law-related services can be improved by allowing consumers to use well-regulated non-lawyer professionals.

While some of the specifics regarding Limited License Legal Technicians are still being worked out, there are some guidelines that the Washington Supreme Court has already outlined.  LLLTs must:

  • Pass a moral character and fitness test;
  • Have an associate’s or bachelor’s degree in paralegal/legal assistant studies with a minimum of two years’ experience as a paralegal/legal assistant doing substantive law-related work under the supervision of a lawyer (at least one year of that under a Washington lawyer) or have a post-baccalaureate certificate in paralegal/legal assistant studies along with three years of experience as a paralegal/legal assistant doing substantive law-related work under the supervision of a lawyer (at least one year of that under a Washington lawyer);
  • Complete 20 hours of pro bono legal service in Washington within two years of taking the LLLT exam;
  • Successfully pass the LLLT exam;
  • Show ability to meet financial responsibilities;
  • Have a physical address in Washington;
  • Create a written contract which describes their services and fees;

After an individual meets all of those requirements for an LLLT they will then be authorized to engage in tasks previously allowed only by attorneys. This is a great development because prior to this rule, these tasks, most of which are basic, have been monopolized by the legal profession but can be competently done by well trained and educated individuals for a fraction of the cost of hiring an attorney. 

Some of the tasks which LLLTs will be able to engage in under the new rule are:

  • Explaining facts and relevancy to their clients;
  • Selecting and completing court forms;
  • Informing clients of applicable procedures and timelines;
  • Reviewing and explaining pleadings;
  • Identifying additional documents that may be needed in a court proceeding; 
  • Providing the client with self-help materials approved by the Board or prepared by a Washington state lawyer;
  • Performing legal research and writing legal letters and documents, but only if reviewed; by a Washington lawyer;
  • Advising the client about other needed documents;
  • Assisting the client in obtaining needed documents;

This model also improves upon that of California, which along with Arizona is the only state to license and regulate legal technicians. California currently licenses legal document assistants (http://www.calda.org/ContinuingEducationCodes.asp) (LDAs) to help consumers with legal document preparation.  However, California LDAs are forbidden from offering legal advice, discussing legal strategies, answering legal questions, or selecting forms for the consumer. Therefore, in California, LDAs can be prosecuted for UPL if they advise clients on something as essential as determining which legal forms need to be completed.        

Under the Limited Practice Rule, Washingtonians will have access to a broader range of services from LLLTs than Californians can receive from LDAs. The ability for LLLTs to be able to advise clients on a broader range of tasks, such as which forms are appropriate, will make the program more dependable to consumers.  For example, if a Californian goes to an LDA with a form that is inappropriate for the task at hand, the LDA may not correct them and suggest the correct form. In Washington, the LLLT can correct obvious consumer mistakes such as this.

Allowing access to LLLTs will also allow legal services organizations in Washington to save money and serve more people with complex legal needs, since LLLTs can alleviate many of the simpler legal issues before legal services agencies. Moreover, courts will benefit by facing more knowledgeable self-represented litigants who have filed the correct paperwork and who will be better prepared for the court hearing, resulting in less rescheduling of court dates and less need for judges to explain court processes to litigants. 

With LLLTs being able to handle more basic legal services, consumers will have a greater ability to save money by unbundling legal services. For example, a person with an uncontested divorce could use an LLLT for the majority of the paperwork, such as division of property issues, but might consult a lawyer for more complicated parts of the divorce, such as child custody.  

If Washington continues to execute the licensing and regulation of LLLTs smoothly, and other states follow Washington’s lead, this could be one of the greatest advances for consumers of legal services since the U.S. Supreme Court outlawed mandatory fee schedules in Goldfarb v. Virginia State Bar in 1975.

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