Judgment Proofing the Profession
28 Pages Posted: 6 Oct 2009
Date Written: October 1, 2001
Abstract
In the law of business organizations, individuals have generally been unrestrained in choosing which legal form they will use to carry on productive endeavors. Professionals, however, have not been afforded such freedom. They have found themselves prohibited by their self-regulatory bodies from practicing their profession in a corporate form. As a result, members of professions have practiced either as sole practitioners or in partnership with other members of the same profession. Professionals practicing in partnership expose themselves to personal liability for the obligations of the partnership and wrongdoing by their partners. This article analyzes the development of limited liability partnerships for the legal profession. The development of LLPs has had several implications for the legal profession. First, the private benefits conferred upon lawyers by LLPs are at the expense of consumers of legal services, particularly unsophisticated consumers. This article also explores the different methods used by lawyers to limit their liability. A policy analysis of limited liability in the law firm is conducted, and an analysis is provided of the legislative process through which LLP legislation was enacted in Ontario. It is concluded that the private benefits conferred on lawyers by LLPs are at the expense of consumers of legal services, particularly unsophisticated consumers.
Keywords: business law, legal profession, limited liability partnerships, law professionals, law firm, legislation
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