ABS and access to justice
November 5, 20145 November 2014
Why we must make it easier for lawyers to deliver services more broadly.
Illustration: Margaret Hagan
Canadians live in a miraculously complex society. Our market economy allows us to produce and consume diverse goods and services. Our democratic governments establish laws which permit economic and social stability. We take all of this for granted and, perhaps understandably, focus on the imperfections rather than being astonished that this complex system works at all. Things are very different in much of the rest of the world.
The significance of law as an underpinning of this complex society cannot be overestimated. Law permits economic relations to be reliably established and investments to be safely made. Law ameliorates market imperfections. Law governs the relations between each of us in our daily lives as well as in our economic relations. Law helps ensure that our governments remain democratic and that those holding state power act within the authority democratically assigned to them. Laws limit the power of government over each and all of us.
Professor Gillian Hadfield says that we live in a “law-thick world”. This legal “thickness” is necessary for our complex system to work yet the legal system is largely incomprehensible for most individuals in society. This is why lawyers exist. Law is important but not easily navigated. Assistance is required. As Justice Major put it for the Supreme Court of Canada in R. v. McClure in the context of solicitor-client privilege:
… The law is a complex web of interests, relationships and rules. The integrity of the administration of justice depends upon the unique role of the solicitor who provides legal advice to clients within this complex system. …
As Professor Alice Woolley has written human dignity, freedom and productive relationships depend on this complex legal system:
… the dignity and freedom that the law promotes is not merely the freedom to be left alone, but is also directed towards “creating conditions in which [citizens] can actualize their values by supporting their creative endeavors and helping them structure their commitments within productive relationships and supportive communities.” The lawyer assists in the creation of those conditions for clients.
If we accept the significance of law to members of our society and that the complexity of our legal system is such that legal assistance is required by most members of society when legal issues are engaged then the moral and public policy importance of access to legal services is obvious.
The essential issue addressed by alternative business structures (ABS) is access to legal services. This issue falls naturally into two aspects namely the areas in which there is no or very limited access and the areas where access is unnecessarily limited.
The intent of ABS is to allow the market to better deliver services by liberalization of existing regulatory constraints. This is not to suggest that there are no other mechanisms to address aspects of the same issues such as increased legal aid and enhanced public legal clinics. But ABS, better legal aid and public legal clinics are not mutually exclusive. Good public policy considers both public and market mechanisms to solve difficult problems. Different parts of complex problems can be addressed by different policy approaches.
To descend from the philosophical heights, what do lawyers actually do for individuals in society? This is an important question in understanding unmet or insufficiently met legal needs. The answer is clear. Lawyers defend individuals in criminal proceedings. Lawyers act for individuals in family law and personal injury matters. Lawyers act in residential real estate transactions and in wills and estates matters. This is confirmed by surveys of what lawyers say they do for individuals and surveys of what individuals say they use lawyers for.
The access issue is not pressing in residential real estate matters or in wills and estates matters where there are material assets involved. Individuals who have significant assets to be transferred by purchase and sale or on death have the resources to obtain legal assistance and the value of what is being transferred justifies the cost of the lawyers’ fees.
The access issue is not pressing in personal injury matters because lawyers in Canada can act on a contingent basis collecting their fees on settlement or success at trial. While there are likely meritorious cases that are not brought because the quantum in issue is insufficient to attract a lawyer acting contingently and while contingent fees may be higher than need be, it is right to observe that access to justice in personal injury matters is much less relevant than in other areas.
While access in criminal law matters is of concern, public, rather than market, solutions are likely of greater significance given the rights involved and the nature of criminal law representation. This is where legal aid and public legal clinics are most important. It is difficult to see, for most individuals involved in criminal proceedings, how market liberalization would have much useful effect.
This leaves family law, which is an obvious access disaster within the range of 70 percent of family law litigants being unrepresented in family law proceedings according to the important work of Professor Julie Macfarlane. This is an area in which it seems likely that facilitating other ways of providing service could help even if the actual proceedings before the court are unlikely to be affected. Allowing family law lawyers to work better together with social workers, psychologists and accountants seems sensible. Some aspects of family law work (financial statements and other court documents) should benefit from technological and process innovations and access to other expertise.
It is no surprise, with this review, that lawyers are sceptical about the access issue and about market liberalization including ABS. Other than in family law, what lawyers mostly see is what lawyers can do despite existing business structure constraints. The main exception is family law where families are forced into legal proceeding because of failed relationships, yet lawyers cannot provide assistance at a cost that makes sense for many families.
But the perspective of individuals is different because individuals know when they don’t go to lawyers even though lawyers have no idea. According to the 2009 Ontario Civil Legal Needs Project, fully one-third of low- and middle-income Ontarians do not seek legal assistance for what they regard as legal problems. According to Pro Bono Law Ontario, large numbers of individuals are provided pro bono assistance by PBLO in non-family law civil litigation. Few of these are personal injury matters. According to a Department of Justice study in 2009, 42.2% of respondents who suffered a personal injury problem consulted someone other than a lawyer about that problem and presumably took proceedings for compensation.
And individuals commonly do not understand which day to day problems are legal problems. According to the 2009 Department of Justice study, legal advice is sought for less than 15% of justiciable problem in Canada.
There is another perspective from which to better understand unmet legal needs. With the advent of the internet and continued development of technology, unregulated legal services are now being delivered by entities such as LegalZoom. In order to avoid prosecution for unauthorized practice of law, these services are essentially do-it-yourself forms. That there is a market for these services strongly suggesting real opportunities for internet-based software-assisted form generation and other assistance.
There is no doubt that there are substantial areas on unmet legal needs. It seems logical to think that market liberalization could permit new ways of servicing these legal needs. Yet it must be conceded that there have not yet been surveys in jurisdictions permitting ABSs addressing whether legal needs have been better addressed after introduction of ABSs. And looking carefully at ABSs in operation in Australia and in England suggests that the largest practical effect of ABSs has been in personal injury. While there is evidence of ABS impact in England in mental health, consumer and social welfare matters, the volume of services delivered in those areas is not yet substantial. While there is evidence both in Australia and England of large consumer legal services firms established as ABSs providing family law services, there is not yet evidence of material positive impact on access issues in family law.
The conundrum faced is that the delivery of legal services is broadly reserved to lawyers (and licensed paralegals in Ontario). Yet what lawyers actually do for individuals is rather limited. There are substantial areas where lawyers do not provide services and, strictly speaking, no one else is allowed to do so either. While market liberalization should expand the legal services that are actually provided, the evidence so far from Australia and England indicates that market liberalization has a greater effect on personal injury work than in areas of greatest unmet or underserved legal needs.
While some will no doubt respond to this conundrum by asserting that nothing should change because change is complicated, one of the options that should be on the table for consideration is limited liberalization while we watch the results of greater liberalization in Australia and England. It may be that those concerned about consolidation in the personal injury sector are right to be concerned. Or it may turn out that, contrary to expectations of personal injury lawyers, large “consumer” firms can provide appropriate services. But there is no good way of sorting out the right answer now and time may tell.
But what doesn’t make sense is simply protecting existing ways of providing legal services when it is clear that there are significant access failures. The better alternative is to make it easier for lawyers to deliver services more broadly. But if that is not acceptable then the alternative must be to allow others to do what lawyers do not do.
Malcolm Mercer is general counsel to McCarthy Tétrault LLP and a litigation partner with a commercial litigation practice. He is the chair of the Ethics and Regulatory Issues Team for CBA Futures.