The Cost of Law: Promoting Access to Justice through the (Un)Corporate Practice of Law
Gillian K. Hadfield
USC Law School and Department of Economics
October 30, 2013
International Review of Law and Economics, Forthcoming
USC CLASS Research Paper No. 13-4
USC Law Legal Studies Paper No. 13-16
The U.S. faces a mounting crisis in access to justice. Vast numbers of ordinary Americans represent themselves in routine legal matters daily in our over-burdened courts. Obtaining ex ante legal advice is effectively impossible for almost everyone except larger corporate entities, organizations and governments. In this paper, I explain why, as a matter of economic policy, it is essential that the legal profession abandon the prohibition on the corporate practice of law in order to remedy the access problem. The prohibitions on the corporate practice of law rule out the use of essential organizational and contracting tools widely used in most industries to control costs, improve quality and reduce errors. This keeps prices for legal assistance high by cutting the industry off from the ordinary economic benefits of scale, data analysis, product and process engineering and diversified sources of capital and innovation. Lawyers operating in law firms have not generated these benefits but they have appeared in countries, such as the U.K., where the corporate practice of law doctrine does not prevail. Eliminating restrictions on the corporate practice of law can significantly improve the access ordinary Americans have to legal help in a law-thick world.
Number of Pages in PDF File: 59
Keywords: access to justice, cost of law, legal profession, corporate practice of law, fee sharing, non-lawyersAccepted Paper Series
Date posted: October 2, 2013 ; Last revised: November 11, 2013
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