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Ribstein, L E --- "Practising theory: legal education for the 21st century" [2011] LegEdDig 37; (2011) 19(3) Legal Education Digest 18

Practising theory: legal education for the 21st century

L E Ribstein

Iowa Law Review, Vol. 96, 2011, pp 1649-1676

An appreciation of the history of legal education is helpful to understanding where it is going. In brief, legal education has developed in a hothouse, insulated from markets by licensing laws and accreditation standards. The hothouse walls are falling, leaving law schools to cope with markets.

As of the mid-nineteenth century, law practice was a trade entered by apprenticing with a lawyer. This system ensured that clients’ needs would determine how lawyers were educated. However, beginning in the last quarter of the nineteenth century, two critical forces joined to produce the current model of law practice. First, Christopher Columbus Langdell created the modern division between law teaching and practice. Second, the American Bar Association, the Association of American Law Schools

(‘AALS’), lawyer licensing, and law school accreditation developed to protect this division from market pressures.

Langdell’s case method, in which students read cases and responded to questions and hypotheticals based on the cases, survived for decades as the core of law-school instruction. This method places little emphasis on advising clients, designing transactions, or preparing cases for trial, and does not require its instructors to have any specialised knowledge or discipline other than what they learn in law school. Under the Langdellian model, law students do not acquire the ability to balance their role as clients’ servants and advocates against that of being the medium for communicating legal responsibilities to clients.

Further developments in legal education purported to provide the necessary background but actually moved law students even further away from the real world of law practice. Legal scholars began to turn to what has been called ‘legal realism’ in the 20th century and to recognise that the law could be understood only by looking beyond the cases.

The urge to look outside the cases coupled with the need to equip lawyers to deal with social-policy issues led to the ‘law and ...’ movement, which sought to unite law with academia’s other disciplines. Law faculties were increasingly populated by PhDs in such subjects as economics, sociology, philosophy, psychology, political science, literature, and history.

Instead of the bland diet of case analysis that generalist law students could easily digest, law students were fed dollops of deep knowledge they could master only to the extent of regurgitating them on exams. Thus, legal education’s evolution from Langdell’s model took it even further from the apprenticeship model and from the market for legal services. As with the previous developments discussed above, the ‘law and ...’ movement was not driven by law schools’ efforts to serve their market, but rather by what law professors wanted to know and teach. While law professors sought to establish themselves as a discipline and to equip themselves and a few elite students to be policymakers, most of the rest of the students were left to fend for themselves in a market that demanded a completely different set of skills.

Although large law firms continue to exist, the particular model of the large firm that came into prominence in the last century has become less tenable. This likely will have several effects on the training of lawyers.

Big firms increasingly must compete not only with other big law firms, but also with clients’ in-house counsel, small firms with lower costs, big firms in other countries, low-cost legal outsourcers, and technical advances (such as automated contracting and discovery) that cut into services that firms up until recently had associates bill to clients.

Law partners who have to spend more time tending to their books of business have less time for building the firm’s value through activities like training younger lawyers.

Small firms and government employers have even less budget cushion for training. The death of Big Law therefore increases law schools’ overall training burden.

First, the growing cadre of exceptionally well-informed, in-house counsel threatens to destabilise the legal-services market. Corporations can shed their reliance on name-brand Big Law firms and choose from all legal-information services as they are developed, from boutique law firms and sole practitioners to outsourcing firms and new technologies.

Second, all kinds of clients can turn to non-lawyer consultants, accountants, and economic and business consultants such as Accenture, which provide law-related services such as expert testimony, risk analysis, and electronic discovery. Third, outsourcing of legal services to India and other low-wage areas reduces work that once provided jobs and training for young lawyers.

Fourth, legal services are ripe for competition by large national consumer firms. Areas of law practice that have long been the staple of sole proprietors, such as wills and real estate transactions, could become retail or online services offered by firms like LegalZoom or chain retailers like Wal-Mart.

Evolving markets create new interest groups that can challenge lawyers’ political power directly by advocating new rules and contesting the validity or interpretation of existing regulation and indirectly by exploiting regulatory gaps. For example, LegalZoom’s website not only offers documents but takes the customer through the process of drafting them.

The efforts of firms like LegalZoom converge with increasing social demands for cheaper legal services. The high costs of the existing legal system result in part from its emphasis on heavy labour intensive work by highly skilled lawyers. This causes a crisis in the justice system by squeezing the middle class out of the market for the legal assistance they need to navigate an increasingly regulated economy. The advent of lower-cost alternatives makes more salient the costs of lawyer licensing.

Developments in the corporate market for legal services also challenge licensing requirements. Corporations could increasingly rely on employees throughout their organisations for legal work. Lawyers can work for these non-lawyer owned firms as long as they do not render legal advice to the firms’ clients.

The loosening or even elimination of lawyer licensing and ethical rules may, in turn, unleash new markets that could even more radically change the law business. The potential for deregulation raises new questions about the market that law schools are preparing their students to enter.

Legal services, like just about everything else, compete in a global market. A significant development in this market is the United Kingdom’s Legal Services Act that, among other things, authorises ‘Alternative Business Structures’ such as firms with non-lawyer owners, and more legal technology that could pave the way for the legal-information market. The Slater & Gordon law firm in Australia took the previously unimaginable step of doing a public offering, pursuant to the 2001 deregulation of non-lawyer ownership in Australia.

Australian and UK firms might compete with US firms that are subject to more stringent ethical constraints. American regulators attempting to stall this competition could meet resistance from clients interested in cheaper legal services, lawyers seeking to compete with their counterparts in other countries, and trade regulators complaining of illegal trade barriers.

Indeed, it was concern about global competition that caused the ABA to establish a commission to study the allowance of multidisciplinary practice. US law firms used to have the significant advantage of exporting clearly superior American legal technology. However, foreign law firms more recently have been able to enter non-US markets with lawyers who can combine US LLMs and local knowledge. Also, countries such as Japan and Korea have increased the quality and output of their law schools, partly by incorporating knowledge from the United States.

Markets for legal information sold as products are poised to join services rendered by lawyers on a one-to-one basis to clients as an important way to convey legal expertise. These new products could include legal documents such as form contracts, complaints, and software; legal inventions such as tax shelters and takeover defences; models and algorithms that enable precise prediction of litigation outcomes; legal information sold in financial markets for use in financing litigation and trading assets whose value depends on litigation outcomes; and common and statutory law itself created as a product rather than through traditional legal processes.

Instead of just learning how to counsel individuals on their context-specific and idiosyncratic problems, legal experts need to be able to use legal information to design products for general use or for trading capital assets. A license to practise law is necessary only for advising individual clients on the law and representing them in court. ‘Legal-information engineers’ might avoid law school and take an abbreviated course of study that prepares them to design legal products. Law schools may have to respond to this competition by offering training in legal-information engineering.

Lawyers’ traditional primacy in collaborations with non-lawyers is reflected in Ronald Gilson’s theory suggesting lawyers could capture some of the rents that otherwise flow to accountants and finance experts by becoming ‘transaction-cost engineers’. Several law schools have built on this intuition by developing courses, programs, and clinics in transactional law.

Multidisciplinary collaborations may become more common as traditional markets for legal services shrink and lawyers seek jobs outside traditional law firms. Law students may need to learn how to move beyond rendering ‘legal’ advice to becoming members of types of teams that render various types of advice or services.

Lawyers and law professors have a shared vision of the future based on lawyers doing pretty much what they have done for over a century and mainly disagree over who must prepare law students for this work. The most radical proposals include one law school’s reshaping its third-year curriculum to devote it to ‘moving students out of the classroom and into the real world of legal practice’.

Law practice traditionally involves applying recognised principles to the facts of particular cases in advising and litigating for clients. This work occasionally requires practitioners to have a deep understanding of the policies underlying cases and statutes. However, most applications of readymade law are routine. In other words, practising lawyers are usually more like mechanics than designers.

In contrast to lawyers’ traditional roles, legal experts competing in the new legal markets may be more like designers creating legal materials than mechanics using them. Thus, the lessons of the ivory tower might become more useful than has previously been supposed in training law students.

As inventors, lawyers will also find intellectual property law much more important than when they were mere client advisors. Just as professional responsibility outlines the relationships between traditional lawyers and clients, intellectual property law establishes the relationships between legal designers and their products.

These legal architects would have to understand the theories that would enable them not only to use, but also to construct legal systems. They would have to grapple with such basic design decisions as the level of confidentiality of records or opinions, selecting and motivating adjudicators, how to enforce decisions, attorneys’ fees, and trial and discovery procedures. An example of a procedure incorporating these sorts of design decisions is a Delaware court rule providing for a hybrid arbitration court procedure in which parties try cases before Delaware chancery judges with appeal to the Delaware Supreme Court using stripped down, expedited pleading and discovery, and confidential decision making.

The increasing ability to make more accurate predictions of legal results provides significant opportunities for lawyers as information engineers. The availability of PACER (Public Access to Court Electronic Records) enables lawyers and scholars to determine how data in case records other than final judicial opinions affect litigation results. Theories based on, among other things, economic analysis, psychology, sociology, decision theory, and political science, could help determine relevant variables.

Lawyers can make a lot of money in the capital markets from being able to predict legal outcomes that determine asset values. These capital assets include direct interests in litigation or indirect interests through firms that participate in litigation, including hedge funds, law firms, and the parties themselves. These assets also could include any firm or capital asset whose value is significantly affected by the application of legal rules, such as firms involved in takeovers. The demand for this expertise could increase the demand within law schools for training in securities and finance law. It also could refocus the study of such basic areas as contract, property, and tort law from advising and litigating, to handicapping the results of litigation.

We have seen that the global market for law both puts competitive pressure on US licensing requirements while opening opportunities for US lawyers. This market also creates opportunities for American legal educators. Law students from the United States could benefit from more exposure to comparative law to handle cases based in foreign countries or to get a better basis for contractually selecting or avoiding particular jurisdictions’ laws.

Legal educators also must cater to law students from outside the United States. Many foreign students already are licensed practitioners in their home countries. They do not want to learn how to practise law in the United States upon graduation, but rather how to apply the basic principles of American common law and system of government to practise in their home countries.

As the global value of a U.S. legal education grows while its domestic value shrinks, US law schools may face questions as to how to allocate their resources between foreign and domestic students. They might be tempted to spend more on teaching full fare foreign LLM students who only want a limited theoretical education and less on their discounted fare American law students who want a broad education which includes costly hands on training. This might mean hiring extra faculty in core areas of law that highlight the basic framework of US law and increased emphasis on comparative law and choice of law issues.

The United States’ continued success as legal educator to the world depends on how well US law schools can compete in a dynamic global market. US educated LLMs practising in their home countries may be able to out-compete US based JDs seeking to enter these markets because the LLMs speak the local language and know the local law.

This is particularly the case as other countries offer stiffer competition to American legal educators. In particular, non-US LLM programs are expanding in Europe (other than Germany) and Asia, and bar passage rates are increasing in countries such as Japan and Korea. The big question mark is China, where the bar passage rate remains very low. The LLM degree plus passage of the New York bar, which is open to non-JD LLMs, gives Chinese students access to jobs in Chinese law firms in the United States or as legal counsellors in Shanghai, Beijing, or Taipei who cannot litigate in the local courts. If these students are given a greater opportunity to become full fledged lawyers in their home country, they may take that option and exit US LLM programs. This suggests that U.S. law schools need to more fully exploit opportunities to prepare US based students for the global market.

The types of expertise emphasised above might mean a shift from a traditional law school emphasis on liberal arts subjects like history, philosophy, and political science, to physical sciences, math, engineering, and computer science.

Legal educators’ main objective should not be to distinguish ‘theory’ and ‘practice’, but rather to focus on the types of legal theory that are identified as most relevant in training law students for tomorrow’s market for legal expertise. Once law schools identify the theory that matters to legal education, they need to hire faculty who can teach this theory. Currently, the basic JD degree is the only one required for law professors, suggesting either that law school is only a professional school or that law remains a Langdellian self contained science. Both suggestions are inconsistent both with legal academia’s post-Langdellian turn toward deeper theory and with the need to prepare law students for the new jobs this paper identifies.

A possible solution is to require a doctoral law degree to teach law, as is the case in countries outside the United States. The US equivalent might be to adapt the SJD degree, currently largely reserved for foreigners seeking to enter US law teaching, as a general requirement for all law professors. Study for this degree could include the various academic disciplines that have been brought into legal academia.

An alternative would be to expect those entering legal education to hold a PhD, or equivalent non-law advanced degree, in subjects important to training law students. The latter approach would be more consistent with the evolving US model. The PhD requirement would enable law schools to offer a variety of courses by experts who are well trained in specific disciplines rather than having all courses taught by experts trained in essentially the same ‘legal science’ discipline. These experts would be expected also to have a JD or sufficient training or experience to enable them to apply their expertise to law.

All of this is not to say that law schools should give up training students for traditional lawyers’ work such as litigation and transactional work. Law schools likely will continue to have clinical and skills courses. But perhaps these courses should be taught with a view toward integrating even traditional lawyer work with the latest theory, either by practice/theory teams or by practitioners who have advanced degrees.

There is a lot of similarity among law schools almost a century after lawyer licensing and accreditation became prevalent: three years of instruction, in similar subjects, mostly out of casebooks, and by the Socratic method. By contrast, in business schools, whose graduates are not seeking state licenses, detailed comparisons of leading business schools ‘suggest an extraordinary amount of diversity’. In particular, business schools differ in the extent to which they rely on case study, experiential learning, lecture, simulations, and other teaching techniques.

Regulators must find a different trade off between protecting consumers from careless or dishonest practitioners and allowing for more flexibility concerning those who may render legal services and provide legal information. One possible compromise is to retain the general purpose law degree, but create alternative professional classifications that allow legal experts to be accredited by public or private agencies in specialties with a core (say a year) of legal training plus a year or two of training in the specialty. The specialty training could combine theoretical training with externships, internships, and clinical or laboratory work. Some possible applications of this approach could be degrees in such new fields as ‘trial engineering’ or ‘transaction development’.

The specific legal process mechanism for enabling this evolution would be flexible accreditation standards that permit various types of schools (including for-profit schools) to compete in the legal education market.

There are many possible futures for the law business which have many different implications for legal education. The best hope is to free law schools from their current accreditation straightjacket.

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