Legal Services Regulation: The Policy Framework

As approved by Council, November 20, 2015

1.      Council adopts the six regulatory objectives for the Society as follows:

i. Protect those who use legal services

ii. Promote the rule of law and the public interest in the justice system

iii. Promote access to legal services and the justice system

iv. Establish required standards for professional responsibility and competence in the delivery of legal services

v. Promote diversity, inclusion, substantive equality and freedom from discrimination in the delivery of legal services and the justice system

vi. Regulate in a manner that is proactive, principled and proportionate

2.      In accordance with the Regulatory Objectives, the Society’s regulation and manner of operation will be proactive, principled and proportionate, and each specific change in the nature or extent of regulation will be evaluated against this approach.

3.      In carrying out its further work to transform regulation, the Society will focus on the anticipated risks associated with each area of regulated activity and, in assessing risk, will always give priority to the protection of the public.

4.      In order to ensure the public continues to benefit from an independent legal profession, together with the protection afforded by it (e.g. lawyer-client privilege, high ethical practice standards and security of trust funds and property), the Society’s regulation will, as a matter of principle and as confirmed by the regulatory objectives, enhance public protection. However it will also, by limiting its scope of regulation, enable the expanded delivery of legal services.

5.      The Society will seek amendments to the Legal Profession Act and will amend its regulations to state that its public interest role is to regulate the delivery of legal services in the province in accordance with the approved Regulatory Objectives.

6.      The Society will regulate the delivery of legal services by lawyers and will also regulate the delivery of legal services by legal entities, which include lawyers, law firms, law corporations, law departments and other similar entities. The type of legal services and clients of the legal entity will be the key determinants of the extent of risk there is to the public from such practices, and therefore the nature of the risk-focused regulation. Lawyers and legal entities will be entitled to practice law / deliver legal services, which may be defined as follows:

The delivery of legal services involves the provision of services in circumstances where the application of legal principles and judgment with regard to those circumstances or the objectives of a person requires the service provider to have the knowledge and skill of a person trained in the law.

7.      Legal services may be delivered by lawyers and legal entities regulated by the Society or by defined classes of approved legal services providers.

8.      Council will have the authority to allow specific organizations or individuals to provide limited scope legal services.

9.      Legal services may be delivered by legal entities in combination with other services, so long as all delivered services are subject to the same ethical and professional standards as are required of the legal services.

10.    The Code of Professional Conduct will be amended to eliminate barriers to fee sharing with non-lawyers.

11.    In its regulations, the Society will require each law firm and legal entity to:

i. designate an individual who will be responsible to the Society for the entity’s compliance with its regulatory requirements;

ii. ensure that all persons associated with the entity who deliver or assist in the delivery of legal services comply with the Society’s Code of Professional Conduct and other regulatory requirements;

iii. comply with the applicable regulations and Code provisions, as they may be modified to apply to entities;

iv. establish and maintain a management system that promotes competent and ethical legal practice; and

v. undertake to self assess and report to the Society on its management system. The frequency of such reporting is to be determined

12.    The Society will create the authority to regulate paralegals.

13.    Retired lawyers may be permitted to offer limited scope services under a new category of membership.

14.    No one who is not a lawyer or legal entity will be permitted to be held out as having either of these titles.

15.    The Society will have the authority and mandate to seek injunctive relief when legal services are delivered by an individual or organization that is not a lawyer or legal entity and there is actual harm or demonstrable risk of actual harm to the public by the unregulated individual or entity.

16.    While advancing its work to implement these policies, the Society should:

i.  continue consultation with the profession;

ii. develop implementation plans for each policy and table them at Council for approval. Each implementation plan should contain a time frame for coming into effect, a financial analysis relating to the costs for the Society to implement the planned change and, if possible, a description of the impact on lawyers and law firms from the proposed change;

iii. engage with other law societies and particularly with the Atlantic law societies about the proposed changes, and share information and resources to allow for consideration by them of the applicability of any of these policies to their jurisdiction; and

iv. identify matters that have national implications and therefore ought to be addressed on that basis, including but not limited to:

• the applicability of the Code of Professional Conduct to legal entities;

• the income tax issues surrounding the possible expansion of delivery of legal services by corporations (including law corporations);

• development of training or credentialing materials for employees of legal entities who are not lawyers;

• consideration of whether legal services need to be delivered by regulated paralegals and whether legal entities could be constituted by them. In the national discussion this has been referred to as “scope of practice”; and

• considerations related to professional liability insurance coverage.

17.    The Society will develop the capacity to measure the impact of the regulatory changes on the public.

18.    The Society will develop materials and promote training opportunities for lawyers and others on the changes to the regulatory framework.

19.    The Executive Director will provide a proposed timetable to Council for implementation of these policies, together with identification of requisite staffing and other resources required and budget implications.