ABS v ABS+ for A2J

This post is authored by David Wiseman, Assistant Professor at the University of Ottawa’s Common Law Faculty.

A noteworthy aspect of the Canadian debate on whether to introduce alternative business structures into the legal services sector is the emphasis being given to the potential of ABS to improve access to justice. Instead of just assuming it will happen, I think we need to integrate specific measures into the regulatory framework to make sure that it does. We need to create what I’m calling ABS+.

I have argued that while the middle class may benefit from gains in access to justice from allowing ABS, the same is unlikely to be true for low-income Canadians. In fact, there are even reasons to think that allowing ABS might make those with low incomes worse off. That’s why the regulatory ground has to be well-prepared from the start.

ABS has a limited potential for increasing access to justice for those with low incomes because as profit-seekers in the market for legal services, ABS entities don’t have an economic incentive to do so – there’s little ROI for creating innovations or new legal services for that sector.

There is a greater likelihood of indirect access to justice gains – or what I will call collateral benefits – for people living on low income. These collateral benefits may appear where a business case can be made for providing some legal services for free in order to glean clients who have the capacity to pay for other services. But it is likely that any free legal services would be limited to legal information and also likely that they would be more oriented to the legal needs that people living on low income might share with people living on higher income, rather than to any distinct poverty law needs.

While the potential for good knock-on effects from ABS may be limited, the potential for bad is more troubling: if access is improved only for the middle- or higher income brackets, it could exacerbate already existing inequalities in private law matters between people of different income levels – for example, landlords against tenants. Plus, to the extent that ABS entities might target low-income consumers, there is a risk that the innovations and developments will be predatory, rather than empowering.

ABS+: How?

The key question to explore in relation to ABS+ is, “What measures need to be integrated into the regulatory framework in order to encourage or compel access to justice for low-income Canadians?” I propose some answers to that question:

• Differential entity-licensing fees: Where the differences seek to encourage provision of low-income A2J services or to penalize failure to provide;
• Redistributive entity-licensing fees: Where a universal fee is set high enough to permit revenue to be redistributed by the regulator to entities that target improving low-income A2J;
• Conditional entity-licensing: Conditions might include:
  • Mandatory minimum levels of low-income A2J service delivery;
  • Code of Corporate A2J Responsibility for legal services entities;
  • Mandatory public-licensing or bulk-buying scheme for low-income A2J services;
  • Licensing levy for funding expansion in Legal Aid Ontario or other low-income A2J services;
• A regulator-sponsored “low-income A2J” service quality-assurance and consumer-information mark;
• A regulator-sponsored incubator fund for development of low-income A2J services.

I look forward to talking about my ideas – and hearing yours – during the upcoming CBA Twitterchat. Join me at @dwwiseman, and @cbafutures, at the #cbafutureschat on May 20 from 12-1pm EDT.