Heenan Blaikie is the Canadian legal profession’s “Canary in the Coal Mine”.

2014-02-24 02:10:41

heenan-blaikie12rb1The collapse of the reputable national firm Heenan Blaikie is the “canary in the coal mine” for provincial governments desperately searching for high -end job creation opportunities in the new “creative class” of multi-disciplinary professional services as well as solutions to the “access to justice” crisis. The collapse portends the very real danger of one more Canadian industry becoming a secondary player in an emergent global market in which it will become increasingly incapable of competing. The following synopsis of developments in the UK is a wake up call for provincial governments to save the Canadian legal profession and law firms from drowning themselves in an outmoded self-regulated practice of law monopoly model and give Canadian consumers the “access to justice” they are in desperate need of and deserve.

“The professional competence of lawyers is not in doubt. The caliber of many of our legal professionals is among the best in the world. But despite this, too many consumers are finding that they are not receiving a good or fair deal”

This stark opening statement in what is popularly referred to as the “Clementi Report” was the culmination of an exasperated UK government exercising its legislative prerogative in the public interest to rectify an increasingly intolerant situation. The legal profession and conventional practice of law had gone “topsy turvy”. There was an emergent multi-faceted legal service market that required a network of legal services providers with skill sets and multi-disciplinary knowledge management competencies in tune with the 21st century.

The Legal Services Act enables professionals who can demonstrate they have the competencies to design and deliver a professional service that is law related and linked with a consumer demand to be independently licensed as niche or limited legal services providers under the auspices of an autonomous Legal Services Boards (LSB). At the individual consumer level Independent legal document providers are now providing cost effective non-contested on-line legal documentation services. A competitive real estate legal services market lets consumers choose between general practice solicitors and niche licensed conveyancers. Consumers can retain the services of independently licensed cost lawyers to sue law firms over disputed legal bills. Creative “access to justice” services are being developed to augment limited funding for public legal aid. At the corporate level accountants and banks are now partnering with law firms to deliver creatively bundled professional services.

Significant capital investment is required to build the multi-faceted/multi-disciplinary legal services entities with the combination of technological infrastructure and human capital depth to be best in class competitors in the global services market. The LSB permits investors and law firms to develop mutually beneficial “Alternative Business Structures” (ABS) that give UK law firms the financial muscle to think big and develop long – term global strategies. The “British Invasion” of thinly capitalized Canadian law firms with takeovers/mergers has started.

Australia was quick to see where the legal services market was headed and has become a leader in setting up global ABS structures. The American Bar Association (ABA) has been rudely awakened from its professional slumber in the aftermath of the 2008 meltdown. It’s created an ethical framework for off shoring of routine legal documentation and litigation discovery support services, primarily to India. It’s struck a series of task forces that are advocating a shift from the monopolistic practice of law to a multi-disciplinary network of strategic “limited legal services providers” as well as looking favorably at ABS models. Individual states have begun licensing independent legal document services providers.

The Canadian legal profession’s self-regulatory monopoly structure is taking a series of one step backward initiatives. The Law Society of Upper Canada (LSUC) has successfully lobbied the Province of Ontario to broaden its self-regulatory mandate to include all legal services and in the process subsume and contain a nascent independent paralegal profession. Other provincial law societies, notably B.C., are going down a similar road that leads to a dead end. Provincial governments can either take their cue from the UK and be the legislative catalyst for the shift of the legal profession to innovative legal services and or add one more chorus to the loss of good jobs lament that’s becoming common place in a Canada that can compete but fails to risk short term pain for the added value in long term gain.