I. INTRODUCTION

II. THE NEED FOR NONLAWYER ADVOCACY

A. IN GENERAL
B. THE SPECIFIC NEEDS OF PERSONAL INJURY PLAINTIFFS

1. The benefits of a paralegal
2. The inequity of the modern contingency fee

A. NONLAWYER ADVOCACY IN THE PERSONAL INJURY SECTOR ONLY
B. ALLOW PERSONAL INJURY PARALEGAL SPECIALISTS NEGOTIATE SETTLEMENTS
C. REQUIRE LAWYER APPROVAL OF SETTLEMENTS
D. REQUIRE LAWYER-CONDUCTED TRIAL WORK IF SETTLEMENT FAILS

A.   BACKGROUND

B. THE ABA'S GOALS REGARDING NONLAWYER ACTIVITY

1. The ABA's first goal: increasing affordable access to legal services

a. Creating affordable rates for personal injury representation
b. Ensuring know-how and expertise through specialization
c. Eliminating the economic pressure to charge high fees

2. The ABA's second goal:  protecting the public from incompetent or unethical conduct by legal advocates

a. Producing competency
b. Disciplinary actions
c. The competitive market
d. Kritzer's control mechanisms
e. The protections recognized by the ABA

C. THE NEED FOR STRONGER ABA ENDORSEMENT OF NONLAWYER PRACTICE

ENDNOTES

Personal injury plaintiffs have an equitable need for access to a profession of legal advocates who, while legally trained, are not licensed lawyers.  Many professions utilize assistants with training and skills approaching those of the professionals themselves.  For example, the medical field employs nurses in general, and "nurse practitioners" specifically.  The legal profession and its clients have long accepted lawyers' use of paralegals that work directly under the supervision of a lawyer.  This paper proposes a profession of personal injury paralegal specialists who work independent of daily lawyer supervision, but subject to some oversight by the legal profession.

Personal injury plaintiffs need access to independent paralegal specialists because of the inequities of the modern contingency fee.  Non-contingency fees can reflect the work done by paralegals at a lower rate.  However, the legal fees paid by personal injury plaintiffs under a contingency fee contract are based on a straight percentage of the total recovery.  The savings earned by a personal injury lawyer who uses an effective paralegal are not passed on to the client.
This leaves personal injury plaintiffs with unequal access to legal services.  One way to correct this imbalance is to allow fully qualified paralegal specialists represent personal injury plaintiffs independent of constant lawyer supervision.  This proposal allows personal injury paralegal specialists represent, and negotiate settlements on behalf of, their own clients.

A. IN GENERAL

Today, many academics call for amendments to the rules proscribing the unauthorized practice of law as a way to increase access to affordable legal services.1  For many clients, legal services are prohibitively expensive.  Yet, a licensed, unaffordable, lawyer is the only professional authorized to provide those needed services.  This unavoidable legal quandary calls for relaxing the unauthorized practice of law rules.

Potential clients who clearly have the financial means to hire a lawyer can do so without hesitation.  Those who clearly don't have such financial means can seek free legal service organizations or pro bono representation.  However, low- to moderate-income persons who don't qualify for legal services are left without reasonable access to the justice system.  They must either forgo legal representation entirely, or fund that representation by depleting their bank account or incurring substantial, debilitating debt.

 These "have-not-enough" clients would benefit from another alternative:  nonlawyer advocacy.  While lawyers hold a monopoly on the practice of law in America, there are other legal professionals qualified to represent clients.  With education, training, and specialization, nonlawyers can acquire the skills needed to provide competent legal services.

B. THE SPECIFIC NEEDS OF PERSONAL INJURY PLAINTIFFS

Despite the asserted plight of the "have-not-enough" clients, personal injury plaintiffs hold the most equitable claim for nonlawyer advocacy.  Many writers argue that all types of clients need nonlawyer advocacy because legal services are becoming unaffordably unattainable.2  However, access to fair legal services depends not only on one's financial capabilities, but also on the very type of legal services one needs.  Unlike other clients, the modern personal injury plaintiff is burdened by a uniquely unfair disadvantage when funding legal representation:  the financial benefits of a greatly expanding paralegal profession are totally foreign to a personal injury plaintiff bound to a contingency fee.
 

1. The benefits of a paralegal

Paralegals are vital to the success of the modern law firm because of their ability to perform substantive legal tasks that traditionally were done only by licensed attorneys.  As recognized by the United States Supreme Court, these substantive tasks include, without limitation, "factual investigation, including locating and interviewing witnesses; assistance with depositions, interrogatories and document production; compilation of statistical and financial data; checking legal citations and drafting correspondence."4

Lawyers delegate a great amount of this work to paralegals, whose salaries are substantially lower than the value of the lawyers' time.  This means that the lawyer has a well-trained and qualified work force to which he can assign substantive tasks for the purpose of affording himself more time to accept additional clients, while simply overseeing and polishing the paralegal's work.  What this means for each individual client is that the law office can provide the same quality of work, but at a much lower price, since the fee billed for a paralegal's work is substantially lower than the fee billed for a lawyer's work.

2. The inequity of the modern contingency fee

One may argue that this inequity is a farce because the use of contingency fees gives most personal injury clients access to legal services that would otherwise be impossible if the client were forced to pay the lawyer's hourly fee.  The contingency fee provides such clients with access to legal representation otherwise beyond their means.  However, the contingency fee is inequitable not because it creates access to legal services (such a proposition would be absurd), but because the ultimate cost for those services is not commensurate with the lawyer's effort.5

The contingency fee agreement is simply a reflection of a lawyer's willingness to assume the risk of no recovery in exchange for a substantial cut of the proceeds, regardless of how those proceeds are procured.  The contingency fee is also, not incidentally, a reflection of a personal injury client's inability to pay for legal needs in any other way.  For the personal injury client, a contingency fee contract provides the only access to legal representation.  Although unfair, such clients must either accept the inequity of a contingency fee agreement, or forego representation entirely.  A contingency fee contract therefore requires a client to pay a potentially much higher total fee precisely because of his or her inability to pay by the hour.
In sum, despite the rules that proscribe the unauthorized practice of law, the expansive use of paralegals has already resulted in greater access to more affordable legal services.  However, although the contingency fee contract provides personal injury plaintiffs with access to legal representation, it denies such plaintiffs the benefits of more affordable legal representation enjoyed by other clients.  Until lawyers change the way they bill personal injury clients, this legal snare will continue to demand fundamental changes to the way personal injury law is practiced today.

The unauthorized practice of law rules should be amended to allow certified personal injury paralegal specialists represent clients, free from ongoing lawyer supervision.  Under this proposal, independent personal injury paralegal specialists represent clients for a "conditional fee" -- i.e., the paralegal receives an hourly fee, but only if he or she is ultimately successful.6  The specialist is authorized to negotiate and secure settlements, but not litigate in court.  To protect the integrity of the settlement itself, the personal injury paralegal specialist must hire a lawyer to review the file and approve the settlement agreement.  Once the lawyer approves the settlement, the paralegal submits to the client a bill reflecting the total number of hours actually allocated to the case.
 

A. NONLAWYER ADVOCACY IN THE PERSONAL INJURY SECTOR ONLY

Many academics and legal professionals advocate the availability of certified nonlawyer specialists for all clients.  However, this proposal limits such advocacy to personal injury plaintiffs.  Other clients already enjoy more affordable legal services because of lawyers' extensive use of paralegals.  Besides, the legal profession is not yet ready for such pervasive change.  This limited proposal simply strives to afford personal injury plaintiffs with the same benefit (i.e., less expensive paralegal work) that is currently available to all clients.  Giving personal injury plaintiffs the option of working with unsupervised nonlawyer specialists gives these clients access to a cheaper source of competent service, and thereby the ability to avoid the inequitable pitfalls of the contingency fee.

B. ALLOW PERSONAL INJURY PARALEGAL SPECIALISTS NEGOTIATE SETTLEMENTS

This proposal gives personal injury paralegal specialists authority to independently negotiate and procure settlements on behalf of their clients.  Although many current unauthorized practice of law statutes allow nonlawyers to engage in a substantial amount of substantive legal work,7 this work must be done under the immediate supervision of a lawyer who is held accountable for the nonlawyer's work.8  This ensures the competency of the work product and gives the client redress in case of malpractice.

This proposal allows personal injury paralegal specialists to work independent of daily supervision, but provides some ultimate oversight in the form of a lawyer's approval of any settlement reached.  That is, this proposal questions why a lawyer must supervise and be accountable for the work product of an equally competent nonlawyer.  An able personal injury paralegal specialist can reach a satisfactory settlement on behalf of a client just as skillfully as a lawyer.9  Therefore, a client should have the option of paying a lower fee to that independent nonlawyer advocate -- rather than a higher fee to a lawyer who employs a paralegal with, if anything, less training and experience than the specialist, and then simply endorses the same work.

C. REQUIRE LAWYER APPROVAL OF SETTLEMENTS

This proposal recognizes the legal profession's concerns for the interests of clients.10  It therefore provides for not only the independence of the personal injury paralegal specialists, but the interests of clients as well.

The ultimate concern should be for the fairness of the settlement.  Therefore, although the personal injury paralegal specialist is free to conduct an independent investigation and negotiate settlements, the specialist must present the settlement agreement to a lawyer for approval.  For a flat fee paid by the specialist, a lawyer reviews the file and the agreement.  If the lawyer thinks it fair, he or she approves the settlement, and the case closes.11  If the lawyer determines the settlement not to be in the client's best interest, negotiation between the personal injury paralegal specialist and the defendant simply resumes.  Ultimately, the negotiations either terminate, or lead to another settlement agreement and a repeat of the approval process.

D. REQUIRE LAWYER-CONDUCTED TRIAL WORK IF SETTLEMENT FAILS

Despite its careful and deliberate steps to ensure competency, this proposal stops short of permitting personal injury paralegal specialists engage in courtroom trial practice.  Adversarial courtroom trial work demands a keen understanding of evidentiary principles that only a law school education and state licensure can provide.  Therefore, although with proper education and experience, nonlawyers can competently negotiate a fair settlement, if negotiation fails and the case must enter the courtroom, the client needs the skills of a licensed trial lawyer.

When this occurs, the paralegal specialist simply hires a trial lawyer to argue the case in court.  Because the vast majority of personal injury cases settle before trial, the prospects of hiring a trial lawyer remain remote.  The paralegal specialist rather than the client incurs the expense of hiring a trial lawyer, so this acts as an incentive to the specialist to facilitate settlement.  However, because a lawyer must approve the settlement, the specialist faces a counter-balancing disincentive to reach a quick settlement just to avoid the cost of hiring a lawyer.

A.   BACKGROUND

 In the wake of public debate over the need for more affordable access to legal services, in 1992 the American Bar Association created the Commission on Nonlawyer Practice for the purpose of "conduct[ing] research, hearings and deliberations to determine the implications of nonlawyer practice for society, the client and the legal profession."12  The Commission launched an expansive data compilation project and received meaningful input from "every identifiable group and sector having an interest in the provision of legal services in the United States."13  After three years of research, the Commission published its recommendations in a report entitled, "Nonlawyer Activity in Law-Related Situations."  This report sets forth the official position of the ABA, and epitomizes the concerns of the legal profession about nonlawyer advocacy.
 While these concerns are legitimate, the introduction of personal injury paralegal specialists fits easily into the general framework outlined by the ABA.  While lawyers (particularly personal injury lawyers) will likely oppose this proposal initially, the work of the Commission on Nonlawyer Practice should convince the ABA of the viability of personal injury paralegal specialists.

B. THE ABA'S GOALS REGARDING NONLAWYER ACTIVITY

 The Commission on Nonlawyer Practice recognized two urgent goals of the legal profession:  (1) "Increasing the public's access to the justice system and to affordable assistance with its legal and law-related needs;"14 and (2) "The protection of the public from harms arising from incompetent and unethical conduct by persons providing legal or law-related services."15  Achieving each of these seemingly incompatible goals is the essence of the debate over amending the unauthorized practice of law rules.  Those who zealously argue for nonlawyer advocacy as a means of increasing access to affordable legal services are opposed by an equally zealous group asserting that nonlawyer advocates should be prohibited because they are per se incompetent.  By implementing the proposal outlined herein, both goals could be accomplished for personal injury plaintiffs -- those with the most equitable claim for nonlawyer advocacy.

1. The ABA's first goal: increasing affordable access to legal services

a. Creating affordable rates for personal injury representation

This proposal retains the benefits, but eliminates the burdens, of a contingency fee.  The personal injury paralegal specialist is paid on a conditional fee basis; similar to a contingency fee, no fee is awarded unless a settlement is reached.  However, the fee is not based on a percentage of the recovery.  Rather, the fee is calculated on an hourly basis, and awarded only upon success.  Therefore, the personal injury plaintiff can still withhold payment until the specialist procures a settlement.
If, however, the paralegal specialist fails to reach a settlement, the cost of hiring a lawyer to argue the case in court might substantially erode the specialist's earned fee.  This puts a premium on specialists who are successful in procuring settlement.  If a paralegal repeatedly fails to settle, the free market will effectively remove him or her from the profession.  If a paralegal enjoys repeated success, however, the market will likely reward him or her with additional clients, and eventually a higher fee.

b. Ensuring know-how and expertise through specialization

c. Eliminating the economic pressure to charge high fees

2. The ABA's second goal: protecting the public from incompetent or unethical conduct by legal advocates

a. Producing competency

Herbert Kritzer, Professor of Political Science and Law at the University of Wisconsin-Madison, argues that specialized training can provide all of the necessary tools:

[T]he key to effective representation is the combination of three types of expertise: knowledge about the substance of the area, an understanding of the procedures used, and familiarity with the other regular players in the process. The latter can come only with experience, but the first two (substantive and procedural expertise) could be imparted through one-year, specialized training programs for paralegals, legal technicians, and licensed advocates. The expertise necessary to handle specialized proceedings or tasks can also be acquired experientially, either through an apprentice-like process or by parallel experience.18

 The minimum education requirements would be followed by standards and procedures for certification or licensure.20  Currently, national paralegal associations like the National Federation of Paralegal Associations (NFPA) and the National Association of Legal Assistants (NALA) already offer their members certification once they pass a stringent exam and meet certain other requirements.21  At this time, NFPA and NALA certification are voluntary.  They are simply tools paralegals use to market themselves to potential employers.  This certification could serve as a way for states to approve an applicant's credentials.

As is the case for many professions, to ensure ongoing competency, states could require that paralegal specialists attend a minimum of regular continuing legal education courses in personal injury law.

The most important means for ensuring competency of personal injury paralegal specialists is the establishment of minimum practical experience requirements.  Practical experience in tasks such as investigating, communicating with the client and the adversary, conducting discovery, and negotiating a settlement will be essential to the success of a personal injury paralegal's practice.  The internship requirements of many accredited paralegal education programs provides only a limited environment in which to actually practice and hone these essential skills.  Therefore, a minimum experience requirement should also be imposed.

b. Disciplinary actions

c. The competitive market

d. Kritzer's control mechanisms

* Institutional controls, in which institutional forums within which the lawyers work take some responsibility for uncovering and sanctioning lawyer misconduct (in the federal courts this is exemplified by Rule 11 sanctions for filing frivolous cases, unsupported claims, and motions.)  [Under this proposal, since paralegal specialists are prevented from engaging in trial work, they have insufficient contact with any such institutional forum.  However, the lawyers who review and approve the settlements could serve this function nicely];

* Liability controls, in which disgruntled clients can seek compensation by bringing a claim for professional malpractice; and

* Disciplinary controls [despite their possible inadequacies detailed above], in which independent agencies (often a part of the state bar) investigate and prosecute violations of rules of professional conduct (with the final disciplinary authority typically resting with the state supreme court).28

e. The protections recognized by the ABA

Herbert Kritzer recently concluded a detailed study comparing the legal services provided by lawyers and nonlawyers in a variety of settings in Wisconsin.  Kritzer concluded that his "systematic research makes it clear that nonlawyers can be effective advocates and, in some situations, better advocates than licensed attorneys.  The assertions by members of the legal profession that the public is protected when only licensed attorneys provide legal services is not supported by what happens when specialized nonlawyers are permitted to represent clients."31  Kritzer's study is the most comprehensive modern attempt to ascertain the competency of nonlawyer advocates.  His conclusions provide ample evidence to dispel the myth that nonlawyers are incompetent advocates.

C. THE NEED FOR STRONGER ABA ENDORSEMENT OF NONLAWYER PRACTICE

The ABA's Commission on Nonlawyer Practice embraced the idea that nonlawyers play an important role in increasing access to affordable legal services.32  Although the Commission recommended continuing the regulated activities of nonlawyer advocates who are authorized by statute, court rule, or agency regulation33, the Commission stopped short of endorsing a blanket rule that would permit independent nonlawyer advocacy.  Instead, the Commission deferred to the discretion of the states to regulate nonlawyer activity as the states deem appropriate.34  In other words, if a state adopts an independent nonlawyer advocacy program, the Commission would probably approve it, but the Commission does not expressly recommend it.

This pseudo-endorsement is essentially meaningless because state legislatures are largely composed of lawyers and persons loyal to lawyers.  Therefore, the lawyer's monopoly on legal services is not likely to see change anytime soon.  In the meantime, personal injury lawyers might welcome expanding the scope of paralegal activities because the status quo keeps paralegals under the direct supervision of a lawyer.  While permitting supervised paralegals to engage in a broadening array of tasks would benefit a great number of clients, it would not assist personal injury plaintiffs at all.  States need an added incentive to allow nonlawyer advocacy.  This incentive should come from a stronger ABA endorsement of limited legal practice by nonlawyer like personal injury paralegal specialists.

The status quo benefits lawyers because paralegals can do a substantial amount of lawyer-like work, which gives the lawyer more time to accept additional clients.  The status quo also benefits many clients, too, because the work done by paralegals is billed at much lower rates.  The rising cost of many legal services is, therefore, countered by the expanding scope of activities for supervised nonlawyers.

Yet until the scope of unsupervised nonlawyer services expands as well, personal injury clients cannot enjoy the same corresponding counterweight to rising cost.  The contingency fee puts personal injury plaintiffs at an inherent disadvantage in the pursuit for affordable legal services.  A lawyer can take the same percentage whether she does all the work herself, or delegates a substantial amount to a paralegal.  Although use of paralegals makes it cheaper for a lawyer to handle a personal injury case, the contingency rate remains unaffected.  This imbalance is simply not fair.  Personal injury plaintiffs do not have the same access to justice as non-contingency fee clients.  Personal injury paralegal specialists can provide more equal access to the legal system, thereby fulfilling a need in American jurisprudence.

1See generally Derek A. Denckla, Nonlawyers and the Unauthorized Practice of Law:  An Overview of the Legal and Ethical Parameters, 67 FORDHAM L. REV. 2581 (April 1999); Jacqueline M. Nolan-Haley, Lawyers, Non-Lawyers and Mediation:  Rethinking the Professional Monopoly From a Problem-Solving Perspective, 7 HARV.NEGOT.L.REV. 235 (Spring 2002); and Julie A. Flaming, Avoiding the Unauthorized Practice of Law:  Proposed Regulations for Paralegals in South Carolina, 53 S.C.L.REV. 487 (Winter 2002).
2 Id.
3 Gloria McPherson, Legal Assistants:  An Evolving Role in the Practice of Law in Alabama, 63 ALA.L.REV. 178, 181; see also Bureau of Labor Statistics, Occupational Outlook Handbook, 2002-03 edition.
4 Missouri v. Jenkins, 491 U.S. 274, 288, n.10 (1989).
5 Furthermore, a high-income client with a moderately valued claim can opt to pay the lawyer's hourly fee rather than give up a full third (or more) of the award, thereby paying a lower total fee for the same service.  Such an option is not available to the average client, let alone the average low- to moderate-income client.
6 In 1995, England adopted a version of the "conditional fee" under which a solicitor is paid a premium hourly fee, but only if a recovery is realized.  See HERBERT M. KRITZER, LEGAL ADVOCACY:  LAWYERS AND NONLAWYERS AT WORK 226 (The University of Michigan Press) (1998).
7 See generally section II (B) (1) herein.
8 ABA Standing Comm. on Client Protection, American Bar Ass'n, 1999 Survey of Unauthorized Practice of Law Committees (September 1999).
9 See generally section III (B) (2) herein, discussing the competency of nonlawyers in certain circumstances.
10 See generally section III (B) (2) herein.
11 The specialist would fully indemnify the lawyer from liability stemming from any potential action subsequently brought by the client.  Otherwise, the lawyer would face an imposing disincentive to providing this service to the specialist.
12 Commission on Nonlawyer Practice, American Bar Ass'n, Nonlawyer Activity in Law-Related Situations:  A Report with Recommendations, xiii (1995) available at http://www.paralegals.org/Development/nonlawyer.html.
13 Id. at xv.
14 Id. at 73.
15 Id. at 125.
16 Id. at 4.
17 George C. Leef, Lawyer Fees too High?  The Case for Repealing Unauthorized Practice of Law Statutes, at http://www.cato.org/pubs/regulation/reg20nlc.html.
18 Herbert M. Kritzer, Rethinking Barriers to Legal Practice, 81 JUDICATURE 100, 101 (1997).
19 Leef, supra note 16.
20 Although standards and procedures for certification or licensure of personal injury paralegal specialists is necessary under this proposal, the details of implementing such standards and procedures is beyond the scope of this paper.
21 See generally http://www.paralegals.org/PACE/home.html and http://www.nala.org/cert.htm.
22 Leef, supra note 16.
23 Kritzer, supra note 17, at 101.
24 Leef, supra note 16.
25 Id.
26 Id.
27 Id.
28 Kritzer, supra note 17, at 101.
29 Commission on Nonlawyer Practice, American Bar Ass'n, Nonlawyer Activity in Law-Related Situations: A Report with Recommendations, 10 (1995) available at http://www.paralegals.org/Development/nonlawyer.html.
30 Id.
31 Kritzer, supra note 17.
32 Id. at 125.
33 Id. at 130.
34 Id. at 134.