Plea for a New Law Society Governance Model

Much like Bronte sisters, French hens and celebrity deaths, my comments about the Law Society of Upper Canada come in threes. And in an effort to pull Malcolm Mercer away from the dark side and bring him into the light, my comments today will focus on solutions. : )

When LSUC was formed in 1797 it was a model for the Commonwealth. More than 200 years later, the governance structure has failed to evolve (ignoring the fact that Upper Canada itself was tiny and ceased to exist in 1841 before eventually evolving into the exponentially larger province of Ontario).

In 1797, benchers would very comfortably sit around a large table to govern the fledgling law society. The very size of the Convocation Room at Osgoode Hall should have given some guidance as to the optimal number of benchers to manage the law society – but it was not to be.

In 1797 it was inconceivable that LSUC would one day be a $100 million entity.

And it would have been mind-blowing to benchers in 1797, that Convocation would have a budget just for itself of $3.0 million.

It’s time to re-think LSUC’s governance.

Starting from a blank slate, would we really choose to govern a $100 million corporation through a huge number of elected and unelected benchers?

I think not.

If we were to create a new governance structure for the law society in 2013, how would we build it?

I suggest that we would choose to create a board of directors (of a size that fits the boardroom table in Osgoode Hall) in which directors are selected for skill-set and diversity – much like directors of well-managed corporations all around the world are selected.

What are the benefits?

Here are just four:

First, the cost of Convocation would be substantially reduced. Remuneration for this smaller group of benchers would be recalibrated to be in line with directors of other large Canadian corporations and they would be expected to act as such. They would receive (if they didn’t already have it) proper governance training preferably with an accredited provider (such as the Institute of Corporate Directors).

Second, we would now have a group of directors with diverse skills/experience/backgrounds – something perennially missing from Convocation. The current electoral process over-weights Convocation with litigators who have a very different experience/skill-set from solicitors – this skews discussions/decisions, as we saw in the articling debate. But just as importantly, a new process would create a slate of directors that better reflects the diversity of the profession (age, gender, race, etc.). Better diversity creates better decisions.

Third, a smaller group of directors creates a more manageable and focussed decision-making process – good process leads to good outcomes.

Fourth, it would allow directors to finally act in the best interests of LSUC. The current electoral process is overly politicized which leads benchers to believe that they have constituents to which they are to pander. Good directors objectively consider the views of relevant stakeholders, they do not pander to them.

With courage, benchers can once again choose to create a new model for governance of law societies in the Commonwealth.

But to do so, a great many of the current crop must be willing to sacrifice their own personal ambitions for the good of the profession.

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Comments

  1. I’m not sure the current model is as broken as Mr K says it is, but to hypothesize along with him for a moment, I have a couple of questions:

    * who appoints this Board of Directors? Presumably the government, to suit its agenda. Private corporations are not known for producing “a slate of directors that better reflects the diversity of the profession (age, gender, race, etc.). ” I suspect that election by the diverse Bar of Ontario produces a more diverse group of Benchers than the average or even well-meaning shareholders of private corporations – and given how public the campaign is, we members have only ourselves to blame if we don’t like the results. The same cannot be said of most public corporations in Canada, much less the private ones.

    * in whose interests would they act? At present the statutory mandate is to represent the public interest, not the interests of the Law Society, much less some class or classes of its members. (I suspect the difference between ‘representing’ and ‘pandering’ depends more on the observer’s agreement with the submissions made than the motivation of the speaker.)

    * if “good process leads to good outcomes”, how does one explain the frequency of private sector (and some Crown corporation) disasters, by directors with lots of governance credentials? It may turn out not to be that easy.

    Private corporate boards do not meet in public, so it is hard to compare the level of discussion between them and the Benchers. No doubt some are better than others. Is there any way to compare the quality of governance of the LSUC with other Canadian law societies that follow a similar model? Do any follow a different model from which we could learn?

    So by all means let’s discuss governance, but let’s do so realistically for the task the Law Society has to carry out. The Law Society has done a lot of adapting since 1797, and the Benchers all reflect the world they live in today, even if some elements of their role originated a long time ago.

  2. To echo John’s comments, I’d be wary of a model where the board considers the various interests of stakeholders in a BCE Inc. v. 1976 Debentureholders type model, where the public might be just one stakeholder to consider among many, including lawyers, investors, and other potential parties. It would certainly increase the scrutiny of self-governance, and not necessarily improve the governance issues cited.

    But as you point out, our recent vote on “Upper Canada” demonstrates that even the benchers appear to value tradition more than function. If that’s not symptomatic of something broken, or at least behaving dysfunctionally, I don’t know what is.

  3. It is my strong believe that self-governance is a privilege not a right, and should be regularly monitored by an independent body with is structured with as many degrees of seperation from the Law Society as possible. This independent body (evaluation model) could, should and would apply to any professional organization. As a privilege, self-regulation should be removed when practiced poorly and reinstated only when demonstratable reforms have been implemented. Tradition, tradition….what does it matter, to the public, whether you are upper, lower or an inbetweener when self-regulation is poorly practiced and even more poorly enforced and monitored. Even after years of working on the reform, of 125 yrs of “tradition” in B.C., public representation remains symbolic and not equally represented; which places the whole notion that the public interest matters into the category of merely a “door stop”. At least now, the public is receiving information about how many chances lawyers are given before the Law Society decides to act and try to protect the public interest. Why does it takes so long if this is their primary mandate? Incidently, this is the mandate on which self-governance was granted through legislation over 200 years ago.
    The public needs to continue to question the validity of every Law Society to act in the public interest if the public has none or minimal representation (skewed voting in favor of the members) in hearing and disciplining of lawyers who break the rules.
    I hope the new tradition of Law Societies across Canada will emphasize accountability, responsibility, justice, equal representation, independent evaluation, enforcement, and the upper side of integrity and ethical conduct of all practicing members in the public interest.

    Fortunately, the public interest is a name that will be around for a long time. It is a worthy tradition to serve but requires every lawyer to Up–per your self-regulation game.

  4. I would also like to see changes made that disallow lawyers from using contractual clauses in settlements that protect their wrongdoings from being found out. Either that or there needs to be more support for those who wish to bring “lawyers behaving badly” to trial. As things are now, it is likely to cost more for the individual to bring a lawyer to trial than any award they might win … hence, the usual “settlement” with the usual silencing clause. And then the lawyer can carry on in the security that he/she won’t be found out (won’t be headline news when, perhaps, they should be) except for the accounting they might have to make to their partners to explain the settlement.

    Perhaps this is one of the reasons an independent governing body is required.

  5. Greetings from the dark side (or at least as Mitch perceives it)!

    There is, as usual, much sense in Mitch’s post. In my view, there are really two simple questions. How many benchers should there be and who should choose them.

    In thinking about these questions, it is useful to keep in mind that addressing controversial issues in convocation is a relatively small part of law society business. Benchers sit on hearing and appeal panels. Benchers sit on committees where most of the work is done and in convocation which mostly receives and mostly approves committee proposals. The number of directors that would effectively direct a corporation is probably not the correct reference point because being directors is not mostly what benchers mostly do.

    Of course, it is possible to separate adjudication and policy setting and some think that would be appropriate. I’m inclined not to agree because I think that hearing cases is valuable in setting policy and that the reverse is true as well.

    All of that said, it is right that convocation can be difficult when facing major issue and a smaller number of benchers might help that. But my bet is that the problem is the complexity of the major issues and that changing the numbers in the room wouldn’t fundamentally make a difference.

    The more central issue is who chooses. There are only two real choices – the profession and government. Mitch is right that benchers risk catering to their electors. Some of the groups representing the profession use the fact of election as a way to pressure benchers. This is wrong-headed and we all should be offended by this. There is some truth to the criticism.

    But the cure to me is worse than the disease. I firmly believe that lawyers would be less well governed if regulated by the state. In ordinary times, I am a sceptic about the ability of government to understand and regulate day-to-day professional activity – and I think that the elected benchers are collectively first rate people who care deeply about and understand the profession and who work very hard in their various roles. In difficult times, I see protection of the rule of law in separation of the regulation of lawyers from the state.

    In the end, what I think happened in the articling debate was a transparent debate on difficult issue with a number of very strong views being voiced. There was no voiced perspective that was “wrong” and none that was “right”. Mitch sees that debate as evidence of disfunction. I have the opposite view.

    In the end, I think the issue of how many benchers there should be is mostly in-side baseball. I would support a decrease in the number of benchers but frankly I think that there are better issues to focus on – alternate business structures, law firm & outcome-based regulation and getting the articling pilot in place/being effectivelty assessed are some of those issues. With substantial governance reform having been accomplished in the previous term (and before my time), I think that we are better to focus on substance rather than process this term.

    And as for who chooses, I believe in self-regulation. It is very far from obvious to me that the state would do a better job even taking into account that politics can (and shouldn’t) come into play.