We Can Close the Access-to-Justice Gap, But You’re Not Going to Like It

mind-the-gap

There is a gap — a pretty big one, in fact — between those who need legal representation and those who can afford it. Many people believe “innovation” will substantially narrow or close this gap. This is a load of hooey.

Neither technology nor business models can make competent legal representation cheap enough to close the justice gap — well, not until after the Singularity, anyway. In the meantime, the only innovation that will make a difference is regulatory. That is because the only way to eliminate the justice gap is to eliminate the prohibition on unauthorized practice of law.

See, I knew you wouldn’t like it. But it’s the only way.

The high cost of legal representation

Our legal system has a pretty obvious problem: its cost. The cost of legal representation, in particular. Average hourly rates in 2012 were about $370 for associates. It would take someone working at minimum wage (currently $7.25) more than a week to pay for a single hour of the average associate’s time. At the median U.S. household income of $50,502, that’s still a bit less than two days of work, before taxes.

[A]ny way you look at it, though, there is a gap. A huge gap. A lot of people cannot afford a lawyer.

Fortunately, lawyers.com says that in rural areas and small towns, fees of $100 to $200 per hour are “probably the norm.” So anywhere from two to four days for someone working at minimum wage, without taking taxes into consideration. Or a day, for someone at the median. That’s without taking into account the cost of living, obviously.

And then, Americans average around $15,000 in credit card debt, $147,000 in mortgage debt, and $31,500 in student loans. In other words, for many Americans hiring a lawyer probably means going into more debt, which means adding interest, and often late fees and overdraft charges, to the lawyer’s hourly rate.

If you are really poor, you might be able to get a lawyer to represent you for free. In general, this means people at or below 125% of the poverty line. (125% of the poverty line is currently $14,363 for an individual, and $29,438 for a family of four. That’s about what you’d make working full-time for minimum wage, and most people would consider themselves poor at twice that.) Free legal services can’t help everyone, either. The Brennan Center for Justice) says about 80% of the need is unmet. Legal Services Corporation says (pdf) it turns away about 50% of those who apply for help.

Regardless, free legal services are limited to certain legal issues. As you might imagine, people who fall into this category are at least as likely to need legal services as those with higher incomes.

And, of course, those eligible for free legal services are hardly the only people who need them. The income limitations leave out the lower middle class, or about a third of Americans, and most of them would have a hard time paying for a lawyer, too. That’s also probably true of many in the rest of the middle class.

While it is not hard to find estimates of the number of people whose needs are unmet by legal aid organizations, I could not find any estimates of the number of Americans who need legal help but are either unable to afford it or too “wealthy” to qualify for free legal aid.

Still, any way you look at it, though, there is a gap. A huge gap. A lot of people cannot afford a lawyer. Most people who cannot afford a lawyer, probably don’t get one.

The myth of rich lawyers

Most lawyers couldn’t afford to hire themselves.

So legal representation is expensive, and lots of people can’t afford it. It’s not clear that there is anything unfair about lawyers’ hourly rates, though. Despite the size of lawyers’ fees, lawyers aren’t automatically wealthy. Remember: most are not earning the six-figure salaries represented by a tiny point on the NALP lawyer salary curve. Most lawyers are earning just $40–65,000, before taxes. That puts most lawyers at or below the median on most personal income scales. Most lawyers couldn’t afford to hire themselves.

In other words, lowering hourly rates will only result in impoverished lawyers. Or more-impoverished lawyers, in many cases.

If legal fees are so high that most Americans can’t afford them, why can’t more lawyers make a good living? The answer is complicated, but in a nutshell, it is expensive to become a lawyer, stay a lawyer, insure against risk, and run a law practice, and it is hard to make a meaningful dent in those expenses. There are lots of ideas for partial solutions, but no proven ways to make lawyering work — at scale — for substantially-lower prices.

Online legal document services are barely smart enough to handle basic legal document prep. Virtual law firms and unbundled services aren’t enough, either. Even virtual lawyering pioneer and evangelist Richard Granat admits that “pure” virtual practices don’t work. He meant “for lawyers.” And if they aren’t a sustainable business model for lawyers, they aren’t going to work for consumers, either. Others think corporatizing law firms by allowing non-lawyer ownership and investment will introduce game-changing efficiencies and new, more-profitable business models. And the various plans to put law students and new lawyers to work for low-income clients is simply untenable without substantial long-term funding — not to mention unhelpful. People need competent legal help, not inexperienced law students and lawyers.

At best, online document prep, virtual law firms and unbundled services, and non-lawyer ownership are components of a solution. They are not the solution itself.

Simply increasing efficiency is not enough. Pretending that reducing overhead is the main thing keeping lawyers from cutting fees is like pretending the cost of paperclips is the main thing keeping Dell from giving away laptops.

So, something’s gotta give, and it is the prohibition on unauthorized practice of law.

Eliminate UPL laws, eliminate the gap

The practice of law is premised on the idea that clients should get competent representation in every case. We aren’t willing to accept many mistakes, and we have a complicated set of professional responsibility rules that set a fairly high bar (even if not all lawyers don’t get over it). That high bar comes with a price — the price of trained, tested, licensed, and experienced lawyers. But that is a price many people cannot pay.

The only way to lower the price is to lower the bar and let everyone compete for clients in the legal marketplace. That means getting rid of laws that forbid the unauthorized practice of law. A couple of years ago, Andy Mergendahl took a look at what would happen if UPL laws were eliminated. Here are his posts:

  1. What would happen to people who need legal help but can’t afford it?
  2. What would happen to people who _can _afford a lawyer, but might prefer a non-lawyer?
  3. What about big clients?
  4. Oh yeah, what about the lawyers?
  5. Last but not least, what would law schools do?

You should read through Andy’s posts, but consider what it would mean for those who fall into the gap.

The costs and benefits of deregulation

Sure, the quality of some legal services will go down, perhaps drastically. But fees are probably close to the lowest they can get under the status quo. If you want fees to drop further, you have to accept a reduction in quality. On the upside, even if the quality of legal representation drops, there still should be a net positive, overall. More people will get the help they need, even if more people get less-than-competent representation.

More justice, in other words, depending on how you measure “justice.”

The question becomes what is the lowest level of legal quality we are willing to accept, and at what price?

Think about it in terms of a simple will package for sale by one of the big online legal document vendors for $69 (the starting price on LegalZoom). Substantially the same thing from a lawyer would probably cost somewhere between $500 and $2,000, although the lawyer is more likely to identify the clients for whom the package is not appropriate. But a lot more people can afford the LegalZoom version, and as at least one lawyer is willing to admit, most of the people who use the online service will be just fine. Sure, there are horror stories, but if more people can afford a simple will package, and simple will packages are things worth having, then it’s a net positive. If we are willing to accept a few more “bad” wills, we can get good-enough wills to a whole lot more people.

The same scenario can play out for other legal services. There are certainly non-lawyers who could do as well as some lawyers in the courtroom. Why not let them? Why not force lawyers to compete on a level playing field?

The question becomes what is the lowest level of legal quality we are willing to accept, and at what price? And keep in mind, there are definitely lawyers who aren’t clearing the bar right now. Lowering the bar will certainly impact quality, but the status quo hardly guarantees it.

Innovating away the gap

Perhaps rating services like Avvo can learn to help potential legal services customers choose the level of quality they are willing to accept. At the high end, those high-priced lawyers will probably still command an impressive hourly fee. Lawyers with less-impressive track records will have to accept less. Slick marketing — by lawyers and non-lawyers alike — will proliferate. (Maybe even by vending machines.)

Perhaps non-lawyer advocates will prove to be a complete failure. But if people like ABA president James Silkenat really want to solve the access to justice problem, this is what they should be talking about. There is no clear benefit to assigning incompetent lawyers (read: new law school grads) to clients of any income level. And lawyers cannot solve the access-to-justice problem. We have had decades to try, and all we have done is chip away at the problem and talk about “innovation” without any apparent ability to do it.

Instead, we should be talking about opening the legal market. If we want drastic change, we have to take drastic measures, and we have to let others take a shot at solving the problem.

(image: http://www.flickr.com/photos/lex-photographic/9374317863/)

  • http://matthewdrnovseklaw.com/ Abraham Matthew

    Two Ideas in response:

    1. More attorney fee/fee shifting statutes
    It seems our working class clients (civil litigation) often barely afford to pay us when sued by a bank/mortgage co./corp. They appear, blow some deadlines, then scramble to get the cash they need to pay us. If there were more fee shifting statutes, the sheer volume would sustain a dedicated law practice and give these people fair representation.

    2. Kill off the ban on solicitation
    Many people do not know where or when to begin to search for an attorney. We litigators see certain areas of law are full of pro se parties or persons who have claims but do not bring them. If we could pick up the phone and call “person being screwed because they don’t know local rule xyz”, we could provide justice. Now in some cases, the rule against solicitation makes sense (PI), but thousands of default judgments a year against pro se litigants does not.

    In sum, lower the bar on access not quality, and prices will lower as well.

    • sean

      I particularly like Idea number 1. Not only does it allow for the payment by the “perpetrator” it will also prevent much of the BS that is filed.

      Add this as Number 3.

      End the mickey mouse crap that IS our court system. I recently had to sit through a long afternoon in small claims. Because it is unethical for me to disparage a Judge, I won’t (I have never understood that rule) but as the face of justice as seen by 40 or 50 people that day, the face was not pretty. Petty, but not pretty.

      Fix the silly docket rollover system. End the oppression of discovery as used by big law firms.Put Judges to work (at least a full 8 hours a day, and 48 weeks a year)

      Opening the doors to more “attorneys” . . . that may be “a modest proposal,” but would be as effective as the original Jonathan Swift eating children. You might as well start building new court houses and raising the bond money to do it.

    • Attny

      I like #1 but it can backfire also. If the fees are shifted back to the individual it can have a chilling effect on standing up for an individuals rights..

  • Karin Ciano

    Great post Sam. There is a tremendous need for legal services, but at a price that won’t let lawyers pay off their law school loans. FWIW, I think that $325 “average” associate billing is also hooey – those are Biglaw rates, which only millionaires can afford. Clients don’t have to go to a small town to find rates in the $100-200 range, they just have to go to a smaller firm with less overhead and a smarter pricing structure. But even $100 an hour is too much for most of us to pay, so that doesn’t solve the problem. I’m persuaded that lower-cost providers might fill the gap. (And if law school tuition came down, imho, lawyers could compete for that business.)
    Right now, we have the equivalent of low-quality UPL all over the place – it’s called appearing pro se. People with no legal training or experience with the system may have no alternative to representing themselves, with very limited assistance from court staff. We would all benefit, I believe, if pro se litigants who wanted low cost representation were able to get it. I have a hard time believing that a competent paralegal or alternative provider would not be able to do at least as well as someone with no training or experience whatsoever.

    • Brock Shriver

      Nice comment on the pro se litigant already being an UPL. I am not sure who these UPL’s would be. Just people off of the street who will talk in front of a judge so the party doesn’t have to? That worked in the 1800′s and probably would have through the 1950′s, but the explosion in the amount of law that has been created since then makes it virtually impossible for an untrained person to practice law in any meaningful way.

  • static

    A difficult and complex issue. Thanks for reducing it to the lowest common denominator so no thought will be harmed while reading it. It’s not like anyone ever discussed this in far greater depth before. Much.

    • Andy Mergendahl

      What in the world does it mean to harm a thought? I’m confused. And to criticize the post for being shallow, but then not adding any depth in the comment, or at least linking to something that adds depth, seems lazy at best. Boo.

      • static

        Nuh uh. Putting links to other blogs in a comment to someone else’s post is spammy and poor form. I won’t do it. Hardly lazy, but just good manners (such an old school concept).
        The posts are there, and had Sam chosen to include them, that would have been fine. But this is Sam’s post, and it’s his call what to include and not include. It can be as deep or shallow as he chooses.
        As for “not adding any depth,” this is a very complex issue, and expecting depth in a comment is asking too much. Should I include the cure for cancer too? I’ve written quite extensively on the issue. Not bad for such a lazy commenter. It’s all there if you care to look.

        • Andy Mergendahl

          A link in a comment isn’t spam per se; some are, some aren’t. The reader (or blog editor) makes that decision. You can choose to never do it, but you may find your comment characterized as lazy if you don’t (which is not the same as calling you a lazy commenter, by the way). And while you’re certainly old school in some ways, your online interactions don’t exactly set the standard for good manners. I can provide links if you like.
          Sam reads your blog, as do I. It seems that on this issue, we disagree with your conclusions.

          • static

            Do you? I wouldn’t be too sure.

            http://blog.simplejustice.us/2011/09/05/the-new-position-the-legal-practitioner/

            Don’t confuse good manners for tepid commentary. I realize the slackoisie aren’t raised with an appropriate grasp of decorum, since they are taught they can do no wrong and therefore whatever they do (or say, for that matter) is inherently correct. Enitrely different issues. I could expound upon this at some length, but it would be tangential to Sam’s post and it would be poor form to head off in that direction.
            See how that works?
            (I’ve tried to code in some basic paragraph breaks as I am pained by the fact that my comments appear as one big block of mush. I have no idea if it will work, and it may end up looking particularly silly. But then, being cast as silly as well as “lazy” doesn’t really bother me much. You realize that, right?)

            • http://samglover.net/ Sam Glover

              I wanted to discuss your post, but Simple Justice was down when I tried to find it.

              </BURN>

  • Jim Levy

    Why don’t we start by redefining what the practice of law is – narrowing it somewhat? Helping people navigate the legal maze does not necessarily mean legal advice. Also, let competent paralegals practice on their own, like nurse-practitioners. Washington State has just started a Limited License Legal Technician program that does just that. see http://www.wsba.org/lllt

    • Attny

      As noted above every time we do that (redefine what the practice of law is) the income of a solo practitioners gets potentially dinged .. no more title abstracts with title insurance, many real estate brokers who do not advise their clients correctly on title issues, etc. I would argue that navigating a legal maze is the lawyers most important job..

  • smcmechan

    Lower tuition will help, and my evidence may be anecdotal, but in my experience a motivated law student even working for nothing is better than a dried up has been attorney who resents having to work for a low income client. I was that client and that law student, and took two attorneys out at knees, metaphorically. I didn’t graduate top of my class either. Low Cost does not mean low quality.

  • myshingle

    I certainly don’t see a problem with experimenting with non-legal providers. But I am not convinced that they would be any less expensive. In my field (energy regulatory work), many developers are represented by “regulatory experts” in permit proceedings and their rates are not much less than mine (though considerably less than large firm partner rates). In addition, will the restrictive bans on lawyer advertising apply equally to non-lawyer providers? Legal Zoom dominates my radio station with offers of “expert” document services – something a lawyer could not promote. Finally, I find that many of the costs of legal services aren’t necessarily from the work itself but from the administrivia – filing fees, transcript fees, deposition reporter costs, expert witnesses. Non- lawyer providers do little to solve that problem.

  • http://JamesBellefeuille.com/ James Bellefeuille

    What are some practice types that currently allow non-lawyers to give legal advice that we could review to see how opening that particular practice type to non-attorneys closed the gap. Social security disability? Are there any others?

    • Scott Hill

      Abstracting / Title insurance, Real Estate Brokers and agents who fill in the blanks on contracts.

      • http://JamesBellefeuille.com/ James Bellefeuille

        Interesting. I never thought of it as law, but I do see the benefits and drawbacks of having real estate & title agents. I would also add Notaries.

      • Attny

        As I mentioned above I know several buyers that got shafted because they did not understand schedule B Exclusions from a title insurance company AND their realtors did nothing to stop them from closing.

  • http://samglover.net/ Sam Glover

    It makes perfect sense if law school does not add enough value to make it a required prerequisite to practicing law.

  • Tyler

    I can only assume this post is satire. Eliminating the regulation of the practice of law will bring about cheap _and_competent_ legal services? Maybe cheap, but surely not competent. That’s baby with the bathwater thinking.

    • Kyle D. Smith

      Competent for what? A lot of practice areas don’t require a comprehensive legal education for competent representation. In law school, most students learn hardly anything about immigration law, family law, intellectual property, tax law, or bankruptcy law. I’m sure those fields take a lot of expertise, but three years of education seems like a waste of time if you wouldn’t learn anything about those fields anyway.

      Law school isn’t a magic place where people emerge as competent practitioners. It’s really just a barrier to enter our field that allows us to charge rates that would otherwise be untenable.

      Also, it should be the client’s choice. If they want to take a risk to save money, it should be up to them. Regulating the legal industry takes that choice away.

  • Scott Hill

    I remember our law school dean, who taught my property class telling about how once upon a time, Abstracting and title work by itself was enough to keep the bills paid for the solo who was inclined to do it. Abstracting/title insurance is an example of UPL being brushed aside to lower costs and open markets. An economic success story! Although it has streamlined transactions, and opened the door to innovation, others may argue that it was a link in the chain that led to the Great Recession of 2008. Not the main cause or even a major factor, but all of the links in that chain have a common denominator, deregulation.

    There are no easy answers, and further deregulation may be an answer, but there are also not any silver bullets. Increased arbitration and mediation can help increase access. Just like medicaid is a model of more access and service for less money, public defenders provide representation to many many clients for a fraction of the cost of those who hire private counsel. Personally I think as a whole the do great work, but there is no getting around the feel of a cattle call where criminal cases are fungible commodities. DHS court where I’ve cut my teeth is much the same.

    I would theorize that any solution to increase access without substantially increasing cost as a whole to society will wind up with a solution that looks and feels much the same. More administrative law judges or magistrates, or the equivalent for each particular are of law that is deregulated, and more attorneys (or non-attorney clerks) who are specialized to handle one particular area of law, with “Cadillac litigation” being more personalized for those who can afford it. OJ still walks free, WM3 still get convicted and the masses saying Equal access doesn’t mean Equality.

    On a side note, how many of those who “can’t afford one hour of a lawyers time” have a smart phone that costs them in excess of $100 every month.

    • Attny

      Interestingly enough I know of several individuals that got burned when they did not understand the exclusions in Schedule B of a title insurance policy.. so I recommend that all buyers of real estate hire an attorney (RE agents do not know enough either.)

  • D

    I acknowledge there is a service gap, but I cannot agree that eliminating UPL is a solution. Simply looking to the risks inherent in deregulation, historically, gives ample evidence that consumers can get the short end of the stick and abuses can creep in. Regardless, one of the first-order advantages to licensing and UPL is not about identifying good people, but in keeping bad people out.

    Disbarred attorneys can be identified and prevented from getting in the courthouse doors. By removing UPL issues, however, the question will become: how do consumers easily identify bad actors? With licensing, consumers have at least some certainty or trust by seeing an Esq. after a practitioner’s name.

    With UPL and licensing, consumers know: (1) If the Esq. has done something horribly bad in the past, then the Esq. would no longer be allowed to have that Esq. and (2) if the Esq. does something horribly bad for me, I can get them disbarred by filing my complaint. Without UPL and licensing, by contrast, the field is opened to all; consumers will face large hurdles to identify deficient practitioners and to prevent them from harming others.

    UPL, in my view, is tied to the issue of licensing. If some form of licensing is still required, what passes for substandard work as needed to lose the license? Would Esq.’s suddenly be held to this lowered standard? I already read enough crappy, borderline-malpractice motion papers and briefs as it is.

    On a side note, anyone who has defended against truther/sovereign citizen briefs and motions know that it is a pain in the behind to do a good lawyerly job in refuting patently moribund arguments. Sure, the good people/services will likely outweigh the bad, but preventing bad actors from giving bad transactional/litigation advice will be much more difficult without UPL and high-standard licensing rules.

  • Timothy C.

    Eliminate UPL laws? I like it. You and I should be allowed to seek legal assistance from anyone we choose. Contractual or negligence liability for those who advise incompetently? Sure. But penalize only those who do wrong; don’t increase costs and complexity for everyone.

    Another factor hindering access to justice is the volume of statutes and regulations. Does a just and free society really need a legal system as massive and dense as ours? Laws should be simple enough for pro se litigants to actually understand some of them. Many folks view God’s law given to the ancient Hebrews as overbearing and restrictive. But compared to law in free America–not so much, eh?

    As a tangent, does anyone find it odd for a profession so concerned about conflicts of interest to also be obsessed with regulating access to the profession? Why should lawyers’ associations have so much influence over who can practice law? Isn’t protectionism at least a temptation?

    Beware the iconoclasm, Sam. It’s contagious.

  • Jake

    Wow, that is a really great idea. I mean, why not go further? Medical cost are also huge. We should just get rid of the unauthorized practice of medicine rules. That would assure medical treatment for all. Sorry, Sam, it doesn’t do any good to have people with no professional training provide professional services.

  • Brock Shriver

    I am curious as to what the law will look like if a slew of untrained people are released into courtrooms all across the country. People with no fear of reprisal if they leave out relevant case law in an argument, or tell a client to lie to the court. What will happen to the stability of the law. The primary function of the law is to afford predictability so that citizens know how to best conduct themselves in their affairs. Much of the reason that our system is so stable is because all of the people that practice law have been trained to think about the law in a similar way. In the short term, deregulating the practice of law will certainly have some cost benefit, however, I think the inconsistencies that untrained practitioners would create over time would be devastating to a society based solely on the rule of law.

    • http://samglover.net/ Sam Glover

      I probably shouldn’t have used the word “deregulation,” which is a different issue than whether non-lawyers ought to be able to provide legal services.

      I don’t think we should remove accountability. I don’t even mean to advocate for eliminating UPL laws. I do think that if we want to close the access-to-justice gap, we probably have to eliminate UPL. But that is definitely an if. We may think the cost of eliminating UPL would be too great, which means the cost of closing the gap is too great. If so, maybe the gap is just something we have to live with.

      • smcmechan

        Sam, why eliminate UPL? Isn’t it a far simpler solution, less throwing the baby out with the bath water, to eliminate the requirement of lawschool to take the bar? Let people challenge it. Then we keep accountability, keep law schools, and relax 1/2 of the requirements driving costs up.

        • http://samglover.net/ Sam Glover

          If we think the bar exam is a meaningful measurement of competence to give legal advice, sure. But I don’t think it is.

          • A_Sa

            Getting rid of the law school (or even just ABA accredidation requirement) seems like a highly tenable option that doesn’t create all the consternation that your UPL suggestion seems to have done. Prior to mid-20th Century, most practicioners studied law under an attorney until they felt prepared to take the bar. Perhaps reexamining the bar exam itself is worth some thought. But nonetheless, this at least guarantees that a fair portion of the people taking the exam will have had some legal trainiing prior to sitting for the bar.
            There would still be a place for schools, but they would have to compete for their tuition dollars against a much larger market than just the other law schools. And a J.D. attorney might be deemed more reliable than a non-J.D. attorney for those clients who care to pay the difference.
            Also, getting rid of the J.D. requirement, but leaving the bar exam and licensing requirements in place, would still mean these practicioners would fall under professional responsibility standards, CLE standards, etc. As additional enforcement mechanisms, this would help lend some credibility to this option, were it ever to be considered (let alone approved.)

  • Ricardo Barrera

    “There are certainly non-lawyers who could do as well as some lawyers in the courtroom.” Like Gregory Peck or Glenn Close! Not only UPL, but many of the dumb ethics rules have to go.

  • Sarah

    I love the idea of the Limited License Legal Technician that they are working on in Washington State and possibly California. http://www.wsba.org/Legal-Community/Committees-Boards-and-Other-Groups/Limited-License-Legal-Technician-Board

  • thesoleless

    I’m a lawyer so this is self-interested, but do you have any idea what would happen if anyone could practice law without being subject to ethical rules? It would be mayhem. Hey, did you just buy a house and put your funds in some dude’s “escrow” accounts? Ooops. That wasn’t a good idea, wasn’t it? Let’s take a court system that inherently relies upon attorneys acting as “officers of the court” then allow that role to be taken up by those who have no ethical obligations. I’m certain this would flood the courts with stupid lawsuits, or even good lawsuits that are mishandled. Attorneys, as officers of the court, can issue subpoenas. Would it be a good idea to allow literally anyone do that? If the legal system is so bad when practitioners are limited to those who have graduated from law school, passed the bar, take CLEs regularly, and have a license to risk, what would happen if Joe Schmo can practice law? It will only be worse.

    There is a lack in medical care. Would you argue that we should get rid of those laws forbidding non-doctors from providing medical care? Because people would die. Why is law different—because it’s not a matter of life or death? Tell that to the guys who are on death row because his non-lawyer cousin Vinny saw a movie and tried to defend him.

    • http://samglover.net/ Sam Glover

      Who said anything about not being subject to ethical rules?