09 Sep Will Canadian Law Firms’ Business Model Change?
Gluckstein Personal Injury Lawyers strive to advocate and educate Canadians on important discussions that could potentially influence them, including the question, Will Canadian Law Firms’ Business Model Change?
Recently the Canadian Bar Association (CBA) caused some controversy by asking regulators to allow Canadian law firms to be publicly traded. According to an article in The Lawyers Weekly, at their annual conference CBA released a report recommending the introduction of law firms owned by shareholders and other non-lawyers. The preface of this alternate business structure (ABS) would reshape the Canadian legal business landscape severely.
CBA is suggesting that the ABS model would be a better option for Canadians as it would provide them with more affordable legal services and better access to justice. However, how can that be the case if this model creates a monopoly, with few large firms nationally, leaving the consumer with little choice? It would appear that the ABS model reflects profitability and market share rather than the consumer. Charles Gluckstein of Gluckstein Personal Injury Lawyers believes in protecting the consumer, he was quoted in this article explaining,
“[With] publicly traded firms you’ve got to be concerned that the motivation, of course, of the investors is for the company to always grow, and that conflicts with the ethics of the law firm and the lawyer in terms of putting the clients’ interests first.”
Since ABS was introduced in Australia and the U.K. large legal service corporations, auto insurers and legal service brokers who outsource to lawyers have come to dominate the market. Has the introduction of this system proven beneficial to consumers? Gluckstein suggests,
“We don’t believe there was a significant improvement in access to justice. We don’t have reliable data to say that in fact clients are happier with an ABS model.”
The OTLA is asking the Law Society of Upper Canada to independently verify “self-serving” studies of ABS’ impact in Australia and the U.K., as OTLA doesn’t want the law society to rush a vote on regulatory changes by February of next year. Especially considering the incentive behind this decision, Gluckstein explained,
“Their motive is profit and they have to grow, so in order to grow they have to purchase more offices, more firms, and that’s why they went to the U.K. They’re now looking at Canada as another growth potential for them.”
Gluckstein Personal Injury Lawyers will continue to advocate for the consumer. Gluckstein Personal Injury Lawyers doesn’t feel that introducing the ABS model would be beneficial as it removes consumer choice among other things. We will continue to follow this story and provide you with updates along the way.
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