CLI - Legal Profession

Question 1

• Reputation of the judiciary is important because

Answer 1

• (1) Informational asymmetries—reputation is a heuristic to figure out how to react to judges and their decisions
  
  • A judiciary with a poor reputation will be starved of resources and respect
  • Decisions will be complied with only if they have a good reputation
• (2) If judiciary is reputable, it will attract individuals with high levels of human K
  
  • High quality judiciary can improve the enforcement of property rights, contract, and investment—all necessary for economic growth

Question 2

How are different legal systems are configured differently to address problems of information asymmetries?

Answer 2

• Collective reputation dominates when the legal system emphasizes social control
• Individual reputation dominates when judges are delegated with the task of lawmaking

Question 3

What types of legal institutions lead to an emphasis on collective reputation for the judiciary?

Answer 3

• “Career system” that involves judges entering a bureaucracy at a young age
  
  • Selected and promoted based on internal judicial assessments
• Individual judges are anonymous
• Lack of information available about any particular judge
• Decisions and proceedings mostly done via paper dossiers
• Less judicial discretion (RULES)
• De novo review of law AND facts
• Larger judiciary, increasing opportunities for horizontal internal monitoring
• Stricter disciplinary measures

Question 4

What are some issues with legal institutions with collective reputaiton emphasized?

Answer 4

• Inability to dissent results in patchwork, esoteric opinions See France
• High monitoring costs to ensure lower court judges stay in line

Question 5

What types of legal institutions are conducive to a focus on individual reputation for judges?

Answer 5

• “Recognition system” that appoints judges later in life after they have established themselves, diluting collective identity
  
  • Fewer opportunities for promotion
  • Appointment based on individual reputation
• Individual opinions, votes, and dissents are publicly available
• Opportunities for oral proceedings
• Greater judicial discretion (STANDARDS)
• De novo review of only law
• Many citations to other judges
• Smaller judiciary
• Loose disciplinary measures – federal judges can only be removed for “high crimes and misdemeanors”

Question 6

How does the judiciary compare in the U.S. and Japan?

Answer 6

• United States
  
  • Individual reputation is emphasized and indeed the reason behind appointment
  • Good deal of discretion
    
    • Appeals only issues of law de novo—permitting more experimentation at the trial level
  • Limited appellate system means relatively small judiciary
  • Many states elect judges – important to invest in reputation
• Japan
  
  • Enter judiciary at a young age and spend career in a hierarchical structure
  • Moved around the country so they are unable to be identified with any particular geography – punishing outlier judges with bad appointments
  • Opinions are unsigned and dissenting opinions rare
  • Legal positivist: there is a correct answer to every case
  • Internal systems of uniformity like damage awards formulae

Question 7

How is the legal profession different in civil law countries?

Answer 7

• Everyone is a specialist – low levels of individual reputation
• Little intra-profession moving
• Distinct legal cultures and expertise characterize the jobs within the profession
• Competition and jurisdiction problems between the jobs within the profession
  
  • Whenever there are a bunch of discrete professions, there is going to be competition between them
• To counter these issues and unify the profession:
  
  • Some countries have instituted a mandatory practical training period after law school
• Civil law country involves much more state control of the legal profession

Question 8

Judges in civil law systems

Answer 8

• Less prestigious than academic and advocate
• Generally humbler class individuals looking for security
• Work is more routine – they don’t make law, just apply it

Question 9

Public Prosecutors in Civil Law Countries

Answer 9

• Two duties
  
  • (1) same as US: prosecute crimes
  • (2) intervene in private disputes to give the proper interpretation of law
• Recent trend: judicialization of the profession – giving them the independence and security of tenure given to judges

Question 10

Advocates in civil law countries

Answer 10

• Close to attorneys at law in the US: meet with clients to advise them + represent them in court
• Trend towards the American law firm model

Question 11

notaries in civil law countries

Answer 11

• More prestigious than in the US
• Three duties
  
  • (1) Public record keeping (quasipublic function)
  • (2) Authenticate instruments
  • (3) Draft legal instruments
• Quasi monopoly status – must be appointed to a certain district

Question 12

academics in civil law countries

Answer 12

• Inheritors of the Roman tradition of jurisconsults
• Teaching is not AS emphasized
• Long, arduous process to become a legal professor
• In Latin America, academics have a second job due to the low pay

Question 13

What’s the market failure in the US legal market?

Answer 13

• Low access to justice because too expensive
• Protectionism – monopoly powers in a jurisdiction
  
  • Rationale for licensing arrangements
    
    • Consumers cannot tell the effort from the output
    • Fears of mass fraud and unethical behavior without licensing scheme
• Barriers to entry imply an undersupply

Question 14

Whats the main issue causing the market failure of the legal profession in the US?

Answer 14

• Principal issue: Protectionist regulation by lawyers for lawyers
• Costly business model that law firms operate under
• Hourly billing foregoes the normal reduced costs of scale
• Paid legal help must come from those w/ JD = expensive degree (no way!)
• Legal service to public must be provided from firm that is owned, managed, and financed exclusively by lawyers

Question 15

How are regulations for the legal profession diff in the UK?

Answer 15

• UK has multiple legal professions
• Regulates lawyers through the LSA
  
  • Incorporates all the core values of ABA + promotes layers of competition
  • Regulation strategy: designate particular instances of legal work as reserved activities and then require those activities to only be performed by authorized persons
    
    • Exact opposite of the bar approach, which makes exceptions for legal work not subject to regulation

Question 16

What’s the LSB and what’s it’s deal?

Answer 16

• LSB (Legal Services Board) oversees the frontline regulators for each of the professions and must be staffed by a lay chair and majority lay members
  
  • Also promulgates internal governance rules and sanction its members
  • Meta regulation of regulators: frontline regulators compete in the design and implementation of their regulatory requirements (act as trade associations)

Question 17

What’s a firm alternative in the UK and how does it compare?

Answer 17

• Created a new type of entity, the Alternative Business Structure as an alternative to the traditional law firm
  
  • Numerous sources of recourse should violations occur: fines, disbar
  • ABSs must have client compensation funds and malpractice insurance
  • Established the Office of Legal Complaints where any consumer can lodge a complaint, and (lay) Ombudsmen are authorized to resolve the complaints with a variety of remedies
  • Successful so far:
    
    • More innovative, statistically more profitable, more likely to charge by fixed fee
    • No evidence of fraud or other ethical issues increasing

Question 18

How does the legal profession in the US counterpoise the democracy a2 de Tocqueville?

Answer 18

• The profession of the law in the US serves to counterpoise the democracy
  
  • Men who self-select into the legal occupation have a taste for formalities and function similarly to the aristocracy in Europe
    
    • Repugnance to the informal actions of the multitude
    • Head political parties and hold a high station in society
    • Permit tyranny so long as the tyranny is legalistic and legitimate, not arbitrary
    • Conservative temperament of those who have reaped the benefits of society
  • Most politicians are also lawyers because they are the sole enlightened class that the people do not mistrust
  • Lawyers, although the American aristocracy, is not inheritable—more a meritocracy

Question 19

Is the legal profession accessible in the US?

Answer 19

• In the US, only 2% of all billable hours are spent on pro bono services for the poor

Question 20

How do levels of legal need in the US compare to levels in other countries?

Answer 20

• Despite the lack of available ex ante legal counsel, consumers navigate complex legal rules throughout their lives
• Moderate to high levels of legal need in the US

Question 21

how do responses to legal issues in the US compare to responses around the world?

Answer 21

US has the highest rate of “no steps taken”

Question 22

Comparative Legal Resources and Expenditures?

Answer 22

More suing and lawyers in the US; less judges in the US

Question 23

Regulation European vs. American Style - Civil Service

Answer 23

• American civil service is staffed with more lawyers, so there tends to be a larger legalistic response to regulation
  
  • Lawyers often grandstand with an eye to their next career jump
  • Deregulation hasn’t addressed root problem of ingrained litigious bureaucracy
  • US does not draw on industry expertise for fear of the conflict of interest
• In Europe, more scientists in civil service, so don’t face same sort of regulatory harassment that delays goods coming to market and innovation
  
  • More cooperation among businesses, government, academia, etc.
  • More technocrats generally

Question 24

Regulation European vs. American Style - Legislation

Answer 24

• Parliament sets objectives and businesses work with regulators to achieve them
  
  • Allows regulators to tackle an issue step-by-step rather than one large step
  • Europe does not have technology forcing regulation
• American acts of congress detail every minute consideration rather than allow agencies in collaboration with industry to figure out what works best

Question 25

regulation in America - two issues?

Answer 25

Large amounts of paperwork, permits, combative interactions required to comply with the regulations

Agencies have overlapping jurisdictions and do not well coordinate among themselves and have conflicting goals that businesses find hard to reconcile

Question 26

What’s a solution to American regulatory issues?

Answer 26

• Solution: Harmonizing global regulations
  
  • Lower transaction costs for joining foreign markets
  • US is hesitant to engage in harmonization out of fear of losing job

Question 27

Why is the US different re:regulations?

Answer 27

1. Contingency fees enables litigation
2. Federalism – multiple overlapping jurisdictions – need lawyers to navigate fraught legal terrain
3. Regulatory capture
4. Litigiousness
   
   • Tort explosion when regulators don’t do their job
5. Adversarial culture