How To Keep Legal Help Unaffordable
Forcing people to pay lawyers for every little bit of paperwork that must ever be filed benefits the lawyers, of course, who don't get fees when people avail themselves of the information in the wonderful Nolo books, for example.
Tom Gordon writes in the WSJ that "Hell Hath No Fury Like a Lawyer Scorned" (forced to compete with businesses offering legal services that don't involve costly attorney fees):
Jackie LaPlatney was fighting back tears as she entered the brightly lighted Watertown, N.Y., storefront called Legal Docs By Me in the summer of 2014. She told the store manager how her ex-husband had never been part of their now-teenage daughter's life, though the girl still bore his last name as an unwelcome reminder of their painful history. All her daughter wanted for Christmas that year was to be able to take the name of her stepfather instead.
Ms. LaPlatney's experiences up to that point had been frustrating and disheartening--she couldn't afford an attorney's high fees for a name change, which could be $1,000 or more. The store's staff assured her that helping customers represent themselves was something the business did every day and quoted her a flat fee of $249 that Ms. LaPlatney could afford. Ms. LaPlatney's daughter's name change was completed in a few weeks, in plenty of time for a merry Christmas.
Legal Docs By Me is just one example of the booming innovation currently going on in the market for legal services. There are thousands of storefront businesses nationwide providing services that empower consumers to handle tasks like name changes and uncontested divorces without a lawyer. In addition, dozens of online companies are providing consumers with document preparation and other self-help legal assistance. The flow of venture capital to these companies has been rising, increasing from $66 million in 2012 to $458 million in 2013.
But booming business and happy consumers have attracted the attention of the local bar association in Jefferson County, where Watertown is located, causing the New York attorney general to file suit last May against Legal Docs By Me for the unauthorized practice of law. The bar claims that unauthorized-practice restrictions protect consumers. In truth, bar associations often use them to crack down on competition from innovative new service providers, preventing people like Ms. LaPlatney from getting affordable legal assistance.
A 2013 study by Stanford Law School professor Deborah Rhode demonstrates the scope of the problem. Ms. Rhode surveyed the lawyers in charge of state agencies nationwide responsible for enforcing unauthorized-practice laws in their jurisdictions. The survey revealed that the most common source of referrals for enforcement actions was attorneys, who stand to profit from restricting competition.
Ms. Rhode also found that more than two-thirds of the enforcement lawyers surveyed could not even name a situation during the past year where an unauthorized-practice issue had caused serious public harm. Of those who were able to recall such cases, almost all involved undocumented immigrants paying scammers who misrepresented themselves as lawyers and did nothing for their "customers." While such outright fraud is problematic, it can be prosecuted under existing consumer-protection laws, and doesn't justify applying unauthorized-practice restrictions to document-preparation services.