LAW MUST DEAL WITH DIGITAL ERA … OR ELSE
Legal profession is stuck in the past and needs to change how it does business, expert warns
Vancouver Sun17 May 2019IAN MULGREW imulgrew@postmedia.com twitter.com/ianmulgrew
“Our business models for law throttle innovation,’ Gillian Hadfield told a Vancouver audience this week. “The problem is cost. Legal help is too expensive because the conventional practice of law is extremely inefficient. It’s not functioning well for anyone.”
The legal system doesn’t work for anyone and a revolution of change is needed to deal with the digital economy because of the failure of lawyers, global legal expert Gillian Hadfield maintained this week in a Vancouver speech.
New technology — self-learning algorithms, automated decision-making and artificial intelligence — promise 24/7 cheaper services while challenging assumptions and practices of dispute resolution, human rights, due process and access to justice.
The legal profession, however, Hadfield insisted was stuck in the past using calcified business models that don’t innovate to increase value and reduce costs while 90 per cent of the population was unable to obtain representation.
She argued the rules of professional regulation must change.
“The legal infrastructure we have is costly, complex and unresponsive,” Hadfield emphasized during Tuesday’s address.
“Our business models for law throttle innovation ... The problem is cost. Legal help is too expensive because the conventional practice of law is extremely inefficient. It’s not functioning well for anyone. This is really going to the heart of the practice of law, the way we do law in all its dimensions.”
It makes no sense that all legal work must be done by licensed lawyers who must work in firms 100 per cent owned, financed and managed by lawyers, Hadfield said.
More than 150 listened raptly in a ballroom at the Pan Pacific Hotel Vancouver — B.C. Court of Appeal Chief Justice Robert Bauman, Legal Services Society CEO Mark Benton, Access Pro Bono honcho Jamie Maclaren, Courthouse Libraries CEO Caroline Nevin, scores of lawyers, a smattering of ordinary folk — and more across the province followed online.
Bauman, who has made access to justice a personal mission, celebrated the turnout.
“It speaks, I think, to a growing realization that access to justice is a very significant challenge for our profession and our communities,” he said. “It indicates that many are now acknowledging that the access to justice crisis is not one lawyers and justice professionals can ignore. The barriers to access will not magically dissolve, we need to act now.”
He said it would require a culture shift in the profession and extensive collaboration in a big tent replete with disrupters, innovators and others who provoke and challenge with new ideas.
The internet offers what seems to be at least part of the answer to bricks-and-mortar courthouses jammed with frustrated self-represented litigants bogged down in archaic processes and lawyers blocking access to assistance with high fees and regulations that exacerbate the crisis.
Yet the profession is intransigent: Those earning big bucks are working for Big Business (and couldn’t care less) and the rest are scraping by pretending to be an elite — terrified of the public’s screaming need for simplified proceedings, cheaper paralegals, do-it-yourself internet services and other relief.
A firebrand intellectual, Hadfield earned a degree from Stanford Law School and a Ph.D. in economics from Stanford University before clerking for Chief Judge Patricia Wald on the U.S. Court of Appeals, D.C. Circuit.
Now teaching law and strategic management at the University of Toronto, Hadfield said data being collected on the digital economy should alarm the hidebound profession.
Much of Tuesday’s 90-minute presentation hearkened back to themes from her 2016 book, Rules for a Flat World (an outdated reference to Thomas Friedman’s 2005 bestseller, The World is Flat, about the effects of globalization at the turn of the century).
The world is much flatter now with mass digitization, global platforms and cutting-edge neural network computing.
Nevertheless, in Hadfield’s opinion the North American legal economy was a closed world with homogeneous ideas, limited consumer feedback and limited access to human and financial capital.
For her, the biggest culprit was professional regulation — the monopoly enjoyed by lawyers that prevented corporations from practising, fee-splitting and the “unauthorized” practice of law by others.
Hadfield rubbed the profession’s nose in its failures and its emperor-has-no-clothes stance — to give those in B.C. experiencing a significant legal problem only one hour of legal advice would cost $2.3 billion at the average billing rate of $300 an hour.
Every practising lawyer in B.C. would have to do 625 hours of pro bono work (78 days at 8 hours a day, or nearly three months) to meet that need, she calculated.
There will never be enough government funding or charity to pay for that, Hadfield said.
Citing U.S. data, she said the top 20 per cent of law firms get 80 per cent of the business — primarily corporate work — and the other 80 per cent chase what’s left.
The average single practitioner charging $300 an hour was actually only billing about two hours a day, she said, and probably taking home after expenses only about $85,000 a year.
Yet while demand for legal services skyrockets, law graduates and small firms struggle to find work. Hadfield said the economics of the practice of law needs to be changed,
She concluded there was only one answer: “Radical reform.”
