The Power of Perspectives

The Canadian Bar Association

Yves Faguy

Reactions to the CBA Legal Futures report

August 14 2014 14 August 2014

For a rundown of the key recommendations contained in the CBA’s final report on Legal Futures, check out our cover story for National. 

Jordan Furlong calls it a watershed report:

Nothing like starting with a bang, is there? The Futures Committee recommends a nearly complete liberalization of the regulations that govern lawyers’ business structures. MDPs aren’t all that dramatic a change anymore — they’re already available in some Canadian jurisdictions, albeit with various restrictions on non-lawyer control — but fee-sharing with non-lawyers is a major development, one that hasn’t received as much attention recently but that could have a significant impact on solo and small-firm practices.

But the big-ticket item — the one that will dominate headlines and conversations — is the recommended approval of law firm ownership, management, and investment by non-lawyers. Note that there are no qualifiers, here or elsewhere in the report, about controlling percentages of ownership. Scotland, for example, allows up to 49% non-lawyer ownership in order to maintain lawyer control, and British Columbia’s 2011 report on Alternative Business Structures spoke approvingly of this middle way. The CBA, by contrast, has gone all in — and wisely, I think. Minority non-lawyer ownership is neither fish nor fowl: too much control for traditionalists, but not enough control to actually change the way firms run, leaving nobody happy. If you’re going to start a revolution, you don’t bring toy guns to the barricades.

The CBA, to its credit, has struck at the heart of the argument over how lawyers should be permitted to structure their businesses. Recommendation #1 will be seen, correctly, as the crux of this report and the vanguard of the recommendations that follow, and it will be the main battleground between traditionalists and liberalizers. If this recommendation is defeated or watered down before adoption, this report loses much of its impact, and many of the subsequent recommendations, even if passed, will feel toothless. If it’s approved, everything afterward will change.

Mitch Kowalski calls it “bold” and wonders how the law societies will react to the report:

For many in Canada’s legal profession the report is a breath of fresh air that should be the catalyst for change. Although, that is not to say that all Canadian lawyers will be in favour of the reports recommendations.

The real issue will be how the law societies who regulate lawyers across Canada respond to the CBA report. As the report points out, Benchers, who are the elected “directors” of these law societies, are generally “older than the profession… and less demographically diverse.” Will this “old guard” that benefited so greatly from the existing system, ignore the CBA Report, or champion it?

Steve Matthews wonders whether it will lead to real changes in the profession:

As one would expect, a report of this magnitude will take some time to decipher. What will regulators, educators and practitioners do with it? That, I suppose, is my question.

Will it result in actionable change? Or are we doomed to yet another round of “change discussions”; spinning us through the “more talk” cycle once again.

And not to be too much of a cynic, but we have to recognize that “more talk” is a distinct possibility. As an example, I can recall discussion surrounding “MDPs being a critical next step for future practise”, for what? 20 years? Likely longer.

This report is good enough that Canadian lawyers will be quoting from it 10 years from now. It’s full of great ideas, and actually charts what I would call a brave path. I only hope, as I expect most of those involved with its production, that this report acts as a catalyst for modernization. The Canadian legal industry deserves a level playing field in the global marketplace.

 

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