Bar in Brief > Bringing New Legal Service Models Into the Fold of Regulation

COLUMN > A Note From the WSBA Executive Director

BY TERRA NEVITT

Several weeks ago, the WSBA and Practice of Law Board (POLB) submitted a proposed order to the Washington Supreme Court that, if adopted, will authorize a pilot process to test entity regulation. What is entity regulation? It means, essentially, allowing companies or nonprofits to be licensed to offer legal services. Under our current regulatory framework, only individuals can be licensed to offer legal services. Our proposal is for a timebound, data-driven pilot that would allow such entities to apply to serve Washington clients under carefully monitored conditions, including court supervision. At the end of the pilot, the goal is to have sufficient data for the Washington Supreme Court to decide how to move forward (or not) with entity regulation. That might mean amending the Admission and Practice Rules (APR) and other court rules to make a more permanent pathway for new legal service models to be authorized in Washington; the court also might determine that entity regulation should not be pursued further.

The proposed order, and the possibility of licensing companies and nonprofits to provide legal services, has sparked some excitement, triggered some fears, and raised many questions. Of those questions, there is one in particular I think is important to address at this point: “Why isn’t the WSBA doing more to regulate the unauthorized practice of law in our state instead of throwing up its hands and resigning itself to its own ineffectiveness?”

One answer, as we have all seen, is that some types of innovative service models already exist (e.g., websites that help consumers complete a will or defend a ticket) and will certainly expand in scope and complexity in years ahead. Consumers are already expressing a preference for these types of tech-savvy legal models via the open market. So, we are at a regulatory crossroads—do something … or sit back and watch?

The WSBA and POLB are squarely in the “do something” camp. By bringing nontraditional, innovative service models into the regulatory fold, we are creating the means by which the court can exercise jurisdiction over them and can thus perform its most important regulatory duty—protecting the public.

We are at a regulatory crossroads—
do something … or sit back and watch?

How? Through licensing. It’s the strongest tool we have as a self-regulating profession. Through licensing, the court gains authority to protect the public—by virtue of being able to suspend or take licenses away. The POLB, of course, concerns itself with what happens outside the realm of licensing by referring complaints alleging the unauthorized practice of law to enforcement agencies. But there is good reason why POLB leaders have been on the forefront of advocating for testing entity regulation: They recognize how tremendously difficult, or even impossible, it is to try to protect the public from the unauthorized practice of law through rarely enforced civil and criminal penalties. Being a self-regulated profession relies on the core tenet that the court is in the best position to protect the public through its oversight of legal services;¹ if that is true—and I fervently believe it is—than we need to bring innovative service models into the fold of regulation.

Bottom line: Through granting a license, the Supreme Court gains authority.

We have seen this cautionary tale play out, with innovation outpacing regulation, when it comes to transportation network companies like Lyft and Uber operating with far fewer guardrails than their taxicab competition. Jurisdictions are struggling now to catch up—to “level the regulatory playing field,” if you will.²

We are not immune from having innovation outpace regulation in the legal industry, but I believe we are still out front. As long as a bar license carries legitimacy with Washington consumers, companies and other entities will be motivated to participate in the proposed pilot process and to subject themselves to a regulatory process that ensures proper oversight and protective measures, all in the public interest. If we do not move quicky to capitalize on the public’s perception that a court-awarded license legitimatizes provision of legal services, we run the risk of, at best, perpetually playing catchup with innovation or, at worst, regulating ourselves into irrelevancy.

As a legal community, we all understand there are deep justice gaps, and I believe we share a desire to close those gaps—for all those who can’t afford or can’t access legal help within our existing models of legal service.

Society at large has changed so much in terms of how we deliver services, from shopping to education to healthcare to travel. These changes have positive as well as negative aspects. And yet they continue. I am curious, can we manage that change in the delivery of legal services? What might happen if we harness some of the power of innovation for people most in need of legal help? That question warrants enough curiosity on my part to test it out. I hope it does for you, too.

MORE ONLINE

Find information about the proposed pilot project to test entity regulation, including:

Read the draft order submitted to the Washington Supreme Court for consideration.
Learn more about entity regulation in general, including a video interview with leaders of the WSBA and Practice of Law Board.
Stay updated in the months ahead, as the court considers the draft order.

Please visit the webpage, www.wsba.org/pilot-project.