No justice for the middle class
Why only the very rich and very poor can afford to hire a lawyer
JOHN INTINI | September 10, 2007 |
When Justice Frank Newbould ordered Karlheinz Schreiber to cover Brian Mulroney's legal bills arising from their recent contretemps, it came as no great surprise. What did raise eyebrows -- at least to those unfamiliar with the stratospheric costs of legal warfare in today's system -- was the bill itself. After a few weeks of work, Mulroney's four lawyers had billed for 203 hours(at rates between $210 and $625 an hour), a plane ticket to fly a member of the brain trust back from vacation for a court date in Toronto, a couple of airport limo rides, and plenty of photocopying, at 25 cents a page, for a grand total of $92,000.(In the end, the judge determined that $64,154.87 was more reasonable.)
Not out of the ordinary for a former prime minister and one of the country's top corporate rainmakers, perhaps. But bills like that -- for what was, after all, only one part of a legal action arising from a mundane business dispute -- have a trickle-down effect on the rest of us.
Many of us only have to deal with a lawyer when drafting a will and closing the purchase of a home. But those in sudden need of legal counsel for, say, a divorce, a wrongful dismissal or a child custody battle, can find themselves in a debt spiral. In 2005, Canadian Lawyer published its annual survey of the going rates across the legal profession. A Canadian lawyer with at least 10 years of experience was charging an average of $235 an hour. A child custody battle cost, on average, $6,180(up from $5,140 in 1997). A contested divorce was $8,505(compared with $6,715 in '97). And the legal costs associated with a typical two-day civil trial averaged $20,830(that was $8,235 eight years earlier). The magazine found that responses to its questions about fees dried up in '06 and '07. One Canadian legal search firm projected that salaries for lawyers at large firms with one to three years' experience would spike by 9.8 per cent in 2007 compared to last year. Meanwhile, corporate lawyers with the same experience were expected to get a 12.4 per cent bump.
While an estimated 90 per cent of civil cases never even make it to court, just getting a lawyer to do a few hours of research, offer a basic opinion on your chances, and maybe write a couple of letters in a simple civil matter -- like a dispute with a noisy neighbour -- will cost about $5,000, says Lorne Sossin, a law professor at the University of Toronto. And according to former Justice John Gomery, many lawyers these days ask for some money up front. "The lawyer is going ask for a $10,000 advance and most people are going to say, 'I'll buy earplugs,' " he says.
Gomery, who retired last month after about 50 years in the legal profession, says access problems for middle-income earners started in the early '80s when firms began merging. That ushered in a new era of big-business law. "The emphasis on professional excellence became secondary to the bottom line," he says. "The commercial side has taken on a greater and greater importance and it means lawyers are looking more and more to what they earn, instead of the service that they're rendering." Back when Gomery was practising law, 1,400 billable hours was a good year. Now, young associates at some big firms are expected to log more than 2,000. In an industry built on dividing an hour into 10, six-minute billable components, time is money. And missing your quota could destroy a young associate's dream of rising to the level of partner.
Richard Stock, the founder of Toronto-based legal strategist Catalyst Consulting, says rising fees and salaries are due in part to a brain drain, and the competition among firms to hold on to their money-makers. "[Fees are] not tied to cost of living any more than Sidney Crosby's salary is," he says. Higher real estate prices are another factor, "and people don't stay as long as they used to. When you have a shortage of supply it drives the cost up for those who stay and that's passed on, of course, to the users."