The Business of Law

The Business of Law

For as along as I’ve done this – this being the business of law in the role of a managing partner in a Michigan based law firm, we’ve accepted, if not reveled in the fact that ‘the practice of law’ is a historic undertaking founded upon traditions such as books, wood lined offices, gatekeepers and yes, legalese. So entrenched are we that we often do not differentiate between the practice of law and the business of law.  After all, we are attorneys, therefore our clients will accept whatever we offer in the nature of costs, availability, efficiency and service. That’s how it’s been and that’s how it is.

But every once in a while there is a watershed moment that actually causes us to pause and take notice of what our clients not only want, but what they will tolerate. Such a moment happened in the early  2000s when suddenly graduating with a law degree was much akin to asking “do you want fries with that”?  Unemployment among graduating attorneys and many seasoned attorneys soared. You may recall a series of law suits which gained attention in the profession when law school graduates sought to sue their law schools for a refund of their tuition alleging their future had been misrepresented by the school. How could this be?  Were there suddenly too many attorneys, or did people no longer have legal issues that required our services?

In October 2013 the ABA Journal cover page was titled “Who’s Eating Law Firm’s Lunch?” That publication contained an article written by Rachel M. Zahorsky and William D. Henderson with the same title. I encourage you to read the article, but I can summarize it as an early look at the business model for the practice of law. I think of it as a reality check that our clients do have alternatives to what we as a profession have determined is the price and the convenience and accessibility of the benefit of utilizing our professional services. It was the realization that nonlegal service providers, of which there were many, could offer “legal services” cheaper, faster and more conveniently than we attorneys could.  We argued “its not real legal services. You’re downloading a form or doing a Google search. That’s not the practice of law”.  But our clients didn’t care. This was at least some form of legal service that was accessible, cost effective, and almost always available on line.

Did this progressive change in our client’s tolerance of our stoic business model impact us as a profession? Yes it did and to such a level that in 2014 the Michigan Bar Association spearheaded an effort titled “The 21st Century Practice Task Force”. Other Bar Associations, attorneys, professors, judges and learned individuals contributed to the findings of the study which concluded in 2016. Michigan Supreme Court Justice Robert J. Young, Jr. wrote the introduction and stated in part:

At the State Bar of Michigan 2014 Annual Meeting, I challenged participants to tackle the hardest problems facing the legal profession. The work of the 21st Century Practice Task Force is an ambitious and thought provoking response to that challenge. I urge members of the bar to review the findings and recommendations with a sense of urgency because the long term health of our profession is at stake.

It is beyond the scope of this brief article to summarize the complete findings of the Task Force, but it certainly warrants comment of the more salient points. Let’s begin with the problem:

The problem: a dysfunctional legal marketplace

Today, legal services delivered in the traditional ways are becoming more unaffordable for large  segments of the population. Even people who can afford legal services are often afraid of the cost and confused about whether they need legal help, what kind of legal help they might need, and how to find it. Despite a significant percentage of lawyers who are unemployed or underemployed, we are falling further behind in our goal of access to justice for all.

Task Force Page 1

And the solution? The Task Force approached the solution from two perspectives. First from the public’s view of a solution and second from the profession’s view of a solution. From the public’s perspective the Task Force concluded:

The large percentage of people with legal problems who do not seek legal assistance from a lawyer tells us that there two things the legal profession must do urgently:

  • Provid trusted, easy-to-find and easy-to-use online resources
  • Build trust about the profession’s ethical standards and value

Task Force Page 3

The solution from the legal profession’s perspective involves the bulk of the 56 page study. But the analysis begins with the following statement:

Closing justice gap requires a variety of strategies, including the following: make legal practice training less costly, apply smarter business processes to law practice, ensure nonlawyers delivering legal services adhere to ethical standards of the profession, and adapt creative technology in the delivery of legal services. However, the answers do not lie simply in connecting people with more lawyers in a more cost-effective manner to help them with their legal problems and navigate court processes. Closing the justice gap also requires educating and helping people avoid legal problems.

Task Force Page 4

Other proposed solutions included training more “practice ready lawyers” which would include changes in both education and mentoring. Another was to adopt our oversight resources to provide ethical guidance in the face of rapid change. And yet one more was to adopt unbundled legal services which will require changes in the Court Rules and in the Code of Professional Conduct. These were not all the conclusions of the Task Force, but they are sufficient to consider the size of the task at hand and the urgency expressed by the participants of the Task Force in light of the economics of the practice of law today.

The Task Force concluded:

Unlike many task force assignments, our Task Force was not charged with completing or perfecting the work of our predecessors. Instead, we were asked to help our profession step out into the unknown. And predicting what comes next when your work is an attempt to write on the clouds of the future can be a fool’s errand.

But we send these ideas into the future with this hope and blessing: that they will not fail because the work is too hard. We are confident in the commitment of our profession to access to justice. If our ideas fail to come to fruition, may it be because they have yielded to better data and better ideas.

I found the Task Force’s analysis to be very complete. It takes a very deep look at the problems that our current business model for the practice of law has created for all of us in this profession. It has now been eight years since their work was concluded and we have seen some change, particularly in the area of unbundled legal services. But there is so much left to do to accomplish access to justice for all. So how much longer should we expect this to take? Another eight years? Another four years after that? After all, is twenty years within the scope of our profession’s ability to meet our client’s needs?

Is there anything that could happen that would massively accelerate this need to change our dysfunctional legal marketplace?

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