LSUC benchers push back decision on ABS

The Law Society of Upper Canada has reignited the debate over alternative business structures as it considers a new measure that looks to facilitate access to justice for vulnerable people.

laire Wilkinson sent a letter to the LSUC urging more consultation on the ABS proposal.
laire Wilkinson sent a letter to the LSUC urging more consultation on the ABS proposal.

Facing calls for more consultation, benchers withdrew a motion late Wednesday set to go to Convocation the following morning that would have allowed non-profits, charities and trade unions to offer legal services directly to clients.

Bencher Malcolm Mercer says the proposal would help connect people to the services they need rather than requiring them to seek out lawyers.

“When people have problems, they tend to have a number of problems. And we know that the most vulnerable members of society often have problems that are economic, social, medical and legal all together,” says Mercer, who is a co-chairman of the law society’s Alternative Business Structures Working Group.

“We also know that those are the people in society who have the most significant unmet legal needs.”

The law society has been exploring alternative business structures since 2012 when the provincial regulator convened a committee to look into the issue. In 2015, the committee decided to shelve a controversial proposal to let non-lawyers be majority owners of law firms, but it continued to look at other ideas, including the one under current consideration.

The working group released an interim report Monday that provided some examples of how the approach was being used in other countries.

These included two law firms owned by the Salvation Army in Australia that support each other. One of the firms provides free legal services to those in need, while the other cross-subsidizes the operation by serving paying clients.

Another example was Aspire Law LLP, a venture between a charity that helps people with spinal chord injuries working together and a personal injury law firm. Half of the law firm’s profits go back to the charity to fund housing and support for people suffering from injuries.

Under the proposal, any civil society organizations that would want to provide legal services would need to register with the law society.

When word got out that the proposal was coming before Convocation, letters poured in from organizations such as the Ontario Trial Lawyers Association and the Federation of Ontario Law Associations expressing concern that more consultation was needed.

“This motion came as a surprise to our organization, as we were never approached as a stakeholder to offer submissions regarding this issue or to engage in any consultations,” the OTLA’s president, Claire Wilkinson, wrote in a letter to LSUC Treasurer Paul Schabas.

Among the OTLA’s preliminary concerns was that potential complications could arise from relationships between charities and law firms, such as the one in Aspire Law LLP. Wilkinson said relationships such as these appear to create exclusive brokerage arrangements that “manipulate” prospective clients into selecting the firm in the partnership to represent them.

“It is our view that charities should not be generating profits on the backs of their clients or creating for-profit businesses under the guise of a charity,” Wilkinson said in the letter.

“This is a problematic, unintended consequence of a well-intentioned policy.”

Wilkinson says the OTLA is pleased the law society chose to defer a vote to allow wider consultation with lawyers.

Proponents of the initiative, however, say there is no need for further examination and debate on the issue, as similar models have been proven to be successful in other countries.

“We need this now. Do we have an access to justice problem in Ontario today? Yes. So what are we waiting for?” says Mitch Kowalski, a lawyer and legal services consultant.

Kowalski says allowing entities to serve a need that is not being met by the legal profession is “pretty much a no-brainer for any thoughtful lawyer in this province.”

He adds that concerns about the Aspire Law LLP model are misguided as the law society recently made rule changes in the area of referrals. Kowalski describes the Salvation Army’s model as “brilliant” and much needed in Ontario.

“There is nothing particular about Australia that would not make this workable in Canada except for the regulatory environment,” he says.

The law society is now looking to get feedback from the profession over the summer, and it will likely consider the proposal in September.

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