Law Firm Regulation (Law Society of BC): Is your firm ready?
The Law Society of BC has been working on law firm regulation standards since 2015. The Law Firm Regulation Task Force has done a great deal of work on this – researching, consulting with law firms, and building a comprehensive program. This initiates a significant change to Law Firm regulation in BC, in order to achieve the highest levels of professional and ethical standards province-wide in the best interests of all law firm clients. Rather that reacting to complaints from unhappy clients, these new regulations are meant to avoid problems from happening in the first place. Here is where things stand right now (note – dates and periods are subject to change as required):
- Early-mid 2018 – The program launched in May 2018 and a pilot project began in June of 2018. Law firms were required to fill out an online registration form, pre-populated with their firm’s current information maintained by the Law Society. Each firm will need to choose a designated representative to communicate and work with the Law Society on this program.
- For the pilot project, 10% of registered law firms in BC were randomly selected to participate in this first self-assessment cycle, having no longer than four months to complete the assessment.
- Mid 2018 – The Law Society will evaluate the pilot-project self-assessments and continue with a phase of resource development (approximately six months) in order to create a revised self-assessment that includes new policies and resources based upon learning from the pilot-project.
- Mid 2019 – The second self-assessment phase will begin no earlier than one year after the completion of the first self-assessment. IMPORTANT: This will include all law firm members of the Law Society of BC (approximately eight months for firms to complete the second assessment).
- Late 2019 – The Law Society will then enter a period of review to create any new policies and resources required by their learning of the second self-assessment exercise.
- 2020 forward – The Law Society will work on further regulatory development, as required.
For a detailed review of this program that contains all relevant information, please refer to The Second Interim Report of the Law Firm Regulation Task Force, published on December 8, 2017. A great document with lots of charts and graphics to help us understand what is required of firms, large and small. You may also refer to the Law Society’s companion publication, Summary of Recommendations of the Law Firm Regulation Task Force Second Interim Report, as approved by the Benchers on December 8, 2017.
The Spring 2017 Benchers’ Bulletin contains an excellent article by the then president, Herman Van Ommen, QC, where he explains the purposes of the program. He sets out the reasoning for this program and that it is not just another layer of regulation upon law firms, but rather a “pro-active approach to regulation”. You also may refer to the E-Brief: July 2018, which provides a current update on the program.
Where to begin?
Start with these eight Professional Infrastructure Elements, which are the basis of the regulations developed for this program, referenced directly from page 18 of the The Second Interim Report of the Law Firm Regulation Task Force, are:
- Element 1: Developing competent practices and effective management. Objective: Ensure the delivery of quality and timely legal services by persons with appropriate skills and competence
- Element 2: Sustaining effective and respectful client relations. Objective: Provide clear, timely and courteous communications with clients in the delivery of legal services so that clients understand the status of their matter through the duration of the retainer and are in a position to make informed choices.
- Element 3: Protecting confidentiality. Objective: Ensure client information, documents and communications are kept confidential and free from access, use, disclosure or disposal unless the client consents or it is required or permitted by law and that solicitor-client privilege is appropriately safeguarded
- Element 4: Avoiding and addressing conflicts of interest. Objective: Ensure conflicts of interest are avoided from the outset, and where not avoided, they are resolved in a timely fashion.
- Element 5: Maintaining appropriate file and records management systems. Objective: Provide appropriate file and records management systems to ensure that issues and tasks on file are handled in an appropriate and timely manner and that client information and documents are safeguarded.
- Element 6: Charging appropriate fees and disbursements. Objective: Ensure clients are charged fees and disbursements that are transparent and reasonable and are disclosed in a timely fashion.
- Element 7: Ensuring responsible financial management. Objective: Establish mechanisms to minimize the risk of fraud and procedures that ensure compliance with Law Society accounting rules.
- Element 8: Equity, Diversity and Inclusion. Objective: Commitment to improving equity, diversity and inclusion and ensuring freedom from discrimination in the workplace and in the delivery of legal services.
These eight Professional Infrastructure Elements are relatively self-explanatory. If firms already have internal policies and practices in place for these, then the designated representative from each firm will need to relate these to the Law Society in their self-assessments. If you fall short or, worse, have no policies or practices in place, then you will need to develop them in order to report to the Law Society. Some firms are already well prepared and others are not. For these firms, you will need a qualified and thorough person or group of people to make sure that you create your own policies and practices that comply with these new regulations. The larger the firm, the more work it will take to meet the new regulations and this project will be ongoing as your firms grow and change. Through this program, the Law Society wants to be proactive by ensuring that all of BC’s law firms operate at the highest professional levels of ethics and policies in both their legal and administrative/accounting practices.