|Restrictions on non-lawyer professionals practicing law are being
challenged by new "multidisciplinary" consulting firms that use attorneys and
other specialists to provide both legal and non-legal professional services. They usually
combine expertise in law, accounting and business consulting.
Some business lawyers
worry that the new multidisciplinary operations threaten them the same way that
independent paralegals threaten solo and small firm practitioners. Clients' needs,
economic forces and an increasingly diverse legal profession that lacks a unified view of
what constitutes the practice of law are all conspiring to break down barriers to practice
Many attorneys believe that the answer to increased competition from non-lawyers is
more restrictive rules and regulations. But maintaining barriers to practice and defending
a guild system doesn't benefit the public. Nor does it help forward-looking attorneys who
think that clients' needs should determine how legal services are provided in the future.
Instead, California lawyers should be permitted to create their own multi-disciplinary
practices that can provide the same variety of services. Smaller firms should be allowed
to make greater use of paralegals, including admitting them as partners. Law firms should
be free to raise operating capital the same way that other businesses are, without
restrictions on who can or cannot hold an ownership interest.
California lawyers currently are not allowed to split fees with non-lawyers like
paralegals. Nor can firms admit accountants, economists or management consultants as
partners, unless the latter are admitted to practice. And law corporations are not allowed
to sell stock to non-lawyers, which is why they cannot become publicly owned corporations
or raise money from private stock sales to venture capitalists.
Misguided bar leaders in the United States and abroad are trying to block the
inevitable changes that will broaden the options available to legal consumers. The
opponents claim that multi-disciplinary firms especially are a danger to consumers -
because lawyers may be supervised by non-lawyers and because the lawyers' work may not be
protected by attorney-client privilege and other confidentiality restrictions.
The American Bar
Association has appointed a 12-member "Commission on Multidisciplinary
Prac-tice" to study the situation. The commission, which has no public members, held
its first meeting last fall in Washington and plans at least two more sessions, including
one in Los Angeles next month. It is scheduled to issue a report at next summer's annual
meeting in Atlanta. In November, the Paris bar held an international conference on the
issue, which was largely critical of the new firms.
The critics argue that the public and clients will suffer if the "core ethical
standards" are abandoned - these core values presumably include restricting the
practice of law to lawyers and preventing fee sharing with other professionals. But it's
not clear that the public shares these worries. Why not let consumers of legal services
decide for themselves who will be their lawyers?
Over the years, bar associations have helped build barriers to exclude competition by
non-lawyers. Last year, the Texas state bar brought legal proceedings against an
accounting firm in a failed attempt to limit the tax services the firm provided. The Texas
bar has even tried to curtail the sale of self-help books by Nolo Press in that state.
Currently, the District of Columbia is the only jurisdiction in the United States that
currently allows lawyers to split fees with non-lawyers, a necessary first step before a
law firm can create a multidisciplinary practice.
Lawyers can adapt to whatever changed circumstances may bring - so long as they are not
constrained by out-of-date views about what the profession of law should be. In the long
run, everyone - attorneys, consumers and the public alike - will benefit from a legal
system that recognizes economic realities and eschews out-of-date restrictions on both
lawyers and non-lawyers.
George M. Kraw is a San Jose attorney.