Elizabeth Thompson of Avizandum Law Books reports on a Meetingof the Scottish Group held at Bird Semple, Glasgow, 10 May 1999.
We gathered in the well-appointed offices of Bird Semple in Glasgow andwere treated to an excellent buffet supper after the lecture. Professor AlanPaterson of Strathclyde University introduced Richard Granat, Director of theCenter for Law Practice Technology Inc, Maryland USA. He is a leading guru inthe application of information technology to legal practice and publishes agreat deal of legal information for the non-lawyer. His talk was entitled Delivering‘Unbundled’ Legal Services Over the Internet: Implications for the Consumerand the Legal Profession.
A digital termite has appeared on the Internet. It is sucking away routineservices from law firms and making them freely available to everybody.
Legal services can be separated (‘unbundled’) into two discrete parts:the provision of standard legal information and tailor-made advice suitable forthe particular client. Mr Granat described a project initiated by the ChiefJustice of Maryland. Concerned about the lack of access to justice for personallitigants, particularly in family matters, he drew up forms designed to helpthem find their way round the court system. This led to the development on theweb of the People’s Law Library of Maryland (www.marylandlawonline.com)which is a comprehensive legal resource for non-lawyers, providing a service notunlike the CABx in this country. It has statutes and case materials, FAQs,procedures, forms, calculators. The results of this project were very positive;clients wanted to be involved, to be in control and be informed. They resentedthe expensive hourly rates charged by lawyers. A further development is nowavailable for do-it-yourself divorce. At www.divorcelawinfo.comthe user can find free legal information at the front of the site, while theback end deals with the cash sale of kits.
Could this happen here? Scotland and Maryland both have a population of aboutfive million, but in Maryland 40-50% of the general population has home Internetaccess – here it is about 5%. In Maryland there is cable modem access in thethree largest counties and there are two law schools, we have five in Scotland.They have 22,000 attorneys – 8,000 here in Scotland.
The nature of legal services is opaque. It is difficult for consumers tojudge the quality of services provided and to evaluate whether they have beencharged fairly. There appears to be no rationality, no fee structure. Ananalysis of the services provided by the legal profession shows that they can bedivided into two parts – the provision of information and ‘bits’. Thereare lots of ‘bits’ that can be standardised: legal answers; forms;intelligent document assembly, etc. It is these bits that can readily beprovided on a legal information site on the Internet. This enables people to getaround the transaction costs.
Legal digital products contain legal information about common subjects; FAQs& forms; diagnostic checks; document assembly services. (A recent Americancase Texas v Nolo Press, decided that a CD-ROM was the equivalent of aperson providing a legal service. Mr Granat does not think this decision wouldbe replicated in other states.) Blake, Dawson & Waldron have developed anemployment manual in hypertext format which will guide middle managers to decidewhen there is or is not a potential legal situation. So the distinction betweenlegal practice and the hypertext manual becomes fuzzy.
The Internet changes the economics of delivery of legal information. In thenormal economy you sell the product and give away the service. In thefriction-free net economy, you give away the product and sell the service;distribution costs are zero, transaction costs are virtually zero. Legal costshave reached an all time high; obtaining standard legal information for nothing,or for not very much, is one way of solving the problem. The legal infomediaryis a net-based business the main aim of which is to represent consumers aspurchasers of legal services. A legal gateway is created by the specialisedintermediary: they help individuals to find the right lawyer; they areindependent and do not rely on advertising; they represent consumers.
So, what of the law firms of the future? According to Mr Granat they need tolearn how to use the technology to increase their market-share and become morecompetitive. The competitors of the future are the independent paralegals,accounting firms, financial planners, software and books. Legal practitionerswill have to become more specialised and firms will have to undertake morecomplex legal work in order to survive. Law firms must not only automate; butalso innovate. Those who cannot adapt will have to leave the legal profession.
The consumer-driven market in legal services is here to stay. The digitaltermite is already hard at work.
