As the legal profession discusses the possibility of deregulation, it might be useful to think about the regulatory areas that are most frequently cited as barriers to increasing accesses. Such a listing may help us decide if the kinds of deregulation being talked about would actually help increase access to justice for those most in need of it, or serve other interests. In turn that analysis would help us decide if more radical changes were needed. I offer the following, based on a wide variety of conversations.
Moreover, some very suggestive research appears to indicate that it is not issues such as these that concern typical practitioners day to day, but rather issues relating to money and billing, and the tensions between those concerns and the desire to provide clients with the help and services that they actually need.
Removal/Relaxation of Unauthorized Practice of Law Restrictions
Full removal of these restrictions would allow anyone, regardless of skill or qualification to perform tasks traditionally required to be performed only by licensed lawyers. It is argued that this will radically increase competition and thus reduce prices for such tasks with the market being relied upon to provide quality. Newly available technologies are often argued to now provide higher quality of work from the non-trained and to allow for sufficient aggregated information to legal consumers to ensure quality. A more moderate deregulatory approach would be to remove from all regulation certain tasks, environments, or situations from any or all of the restrictions below. Indeed, the establishment of certain court based service systems and the distinction of “legal information” from “legal advice,” are just two such steps.
Reduction of Qualification Requirements
Assuming, on the other hand, that it is appropriate to maintain a privileged group given a monopoly license to perform certain tasks, it might be decided that the barriers to entry to that group might be much lower in terms of education, professional qualifications, and the requirements of the certification process.
Of course, the primary argument against such moves would again be based on quality and consumer protection. I very much doubt that these requirements have been significantly validated.
Removal of Ownership Restrictions
Ownership restrictions, which prohibit ownership and control of lawyers’ services by non-lawyers, other than in certain limited situations, are defended as required to ensure the quality, client loyalty, and service values of the profession. The primary argument that such ownership rules changes would result in a massive expansion of available services at lower costs depends on the assumption that capital investment, technological innovation, and management efficiency are all dramatically reduced by the exclusion from ownership of non-lawyers.
Interestingly, these restrictions do not enjoy the support of all sectors of the bar. Rather some in the corporate and international sectors fear that these prohibitions put limits on their ability to compete with international accounting firms. There are also those who see these rules as inhibiting partnerships with social workers and others who might improve the quality of services. Finally, some argue that they act as a major barrier to what is sometimes called “Tesco Law,” named after a UK supermarket chain that was at one point envisioned owning and operating law offices in their stores. It may be generally important that the study that showed that most practical day to day ethical concerns were not those addressed by the code, but rather the money/service/billing tensions also showed that such concerns were greatest in large firms. To the extent that this is generally correct, this would suggest that it is not so much the formal institutional structure of the owner, or their professional qualifications, but the size of the operation.
Removal of Promotional and Marketing Restrictions
There has probably been more activity towards “commercialization” in this area than any other. A number of US Supreme Court opinions, dating back decades, have relied on the First Amendment to restrict states in their efforts to control lawyers advertising, promotion, and client recruitment. Notwithstanding these decisions, and not withstanding that law firms at all levels consider marketing an important part of their task, it appears that few attorney-client relationships are commenced through forms of marketing standard in all other sectors. Serious efforts are being made through technology to change this.
The argument for significant liberalization is that marketing would result in choice, and choice would result in lesser prices, and thus more access. The argument against is that promotional freedom would lower quality, result in a race to the bottom and lower the tone of the profession. Nor is it hard to find examples of excessive (and perhaps tasteless) promotion that flourish under current rules that would illustrate at least the last of these arguments.
Removal of interstate practice prohibitions
Creating a single national legal market, regardless of action on any of the other de-regulatory activities listed here would remove some but not all of the geographic barriers to entry into service delivery. It would make organizing national high technology delivery systems much easier, and by forcing higher priced local providers to compete with more efficient ones over the state line, or in a national delivery system. It would not, however immediately reduce the cultural barriers to non-local practice. Even in a high tech environment, knowing the clerk and the judge all too often make all the difference.
Removal of conduct regulations (conflict, zealousness, quality, confidentiality)
Finally, bar regulatory bodies impose a variety of expectations for conduct by attorneys. While there are minor differences between the states, all draw heavily upon the ABA Model Rules of Professional Conduct. At least formally, these are designed to ensure the loyalty of the professional to the client, and the quality of his or her work.
Completely removing these requirements, while maintaining the legal monopoly, would mean that expectations for quality and loyalty in matters such as conflict of interest, zealousness, and confidentiality would be left to the market and to the interests of the lawyers in maintaining their reputation in the market. A monopoly without any limits on conduct would be hard indeed to justify and leave us with the worst of both worlds. Moreover, notwithstanding the additional information made available through technology and crowdsourcing, it is hard to imagine that most potential low and middle clients would be able to assemble enough information to make good choices.
But to conclude that there is value in identifying at least the floor of expectations of attorney conduct (and in the real world the Model Rules probably set a very low ceiling indeed, except when it comes to issues easy for the public to understand like client asset theft) is very different from concluding that the current conduct rules are in fact over or under inclusive.
To the extent that they restrict flexibility, these rules increase prices and thus reduce access to justice. To the extent that they help ensure that a client obtains meaningful access to justice, that may be worth the cost. An economic analysis of the burdens of each imposition would require comparing the extent to which lower prices would increase access and the extent to which the regulation would ensure that access was meaningful.
This calculus may well change rapidly with emerging technology, partly because the quality problem may be reduced by technology, and partly because the costs of inflexibility may be increased dramatically.
I hope this analysis is helpful
Great question, Jim. It really depends on what we want substantively. I think, generally, it can not be lawyer dominated, but avoid capture by any one sector, and somehow be structured to encourage economic incentives AND quality/consumer protection. From a political point of view, it is c;eary helpful if the bar feels it has a place at the table as new forms of delivery are authorized. So far the Washington Bar has, despite initial opposition, been very supportive of an access-oriented approach. A good sign.
Hi, Richard, this is a terrific list to stimulate lots of thinking.
Have you or anyone else given any thought to what kind regulatory structure would replace the bar, how it would be funded, and what it would look like? As you know, this was one of the primary debates about the State of Washington’s LLLT classification.