LSBC regulation worries small firms more than larger firms

It was returned to the LSBC for evaluation in October. The LSBC is now examining the results of the pilot before launching the entire program. Law firms are expected to have policies and procedures in place that would flag problems before they affect clients or lead to complaints to the firm or the LSBC.

Walker, who spent more than a day filling out the LSBC questionnaire and firming up policies at the time, says smaller firms like his — which is comprised of four lawyers — are also concerned about the financial impact and what future demands registration and regulations might bring. A large portion of firms in B.C. are small firms or sole practitioners that do not have the staff resources or the established systems that ease the transition for larger firms.

Bill Westeringh, B.C. region managing partner for Fasken Martineau DuMoulin LLP, says he also participated in the pilot. The self-assessment tool prompted the firm to revisit its policies and procedures. “On many of the topics, not surprisingly, we are already focused on these areas,” he says.

But the self-assessment process underlying regulation and registration is a positive one that Westeringh supports. “It is a tool in the managing partner’s tool kit,” he says. It is also a powerful prompt, he says, as a means of convincing other partners in the firm of the need to have such policies.

Bill Maclagan, managing partner at Blake Cassels & Graydon LLP, also participated in the pilot. “It really just caused us to look at our policies and the way we do things. We were already doing most — if not all — of it,” he says.

Blakes does not write down every policy and procedure, Maclagan says, but “the major ones are written down.” The process builds consensus on preventive measures. “You can’t give up management of the law firm to the law society and I don’t think that is the intent, but you need to have policy and procedures in place,” he says.

Miller Thomson LLP managing partner Michael Walker didn’t participate in the pilot, but he says, “None of this new to us.” Walker says there are policies and procedures plus in-house resources that lawyers can turn to when in doubt. Some policies and procedures are written down and internal groups handle potential flash-points such as client conflicts. “We have a whole department,” he says. Large firms are usually on top of any issues that can lead to complaints, he says.

Walker says he doesn’t see himself changing policy but mainly monitoring change or problems. “My job is really to see that these things are done and deal with problems when they come up,” he says.

James Paterson, managing partner of Pushor Mitchell LLP in Kelowna, wasn’t chosen to participate in the pilot and says it is still early days in how the whole process will work. “But a firm like ours has a robust policy system,” he says, with policies ranging from conflict of interest to inclusion. “We see ourselves as proactive.”

Paterson’s main worry is financial. “My concern is that it will raise the cost of the administration of the firm,” he says.

Dale Perry of Perry & Co. in the northern town of Smithers sees regulation and registration impacting on his management role. “It is going to make it busier. We have five lawyers and 10 staff. It is another layer of responsibility.” His firm already has policies and procedures in place and only tweaking may be needed in the future, he says.

Where Perry sees a potential problem is if the LSBC does not consider the ability of smaller firms to meet certain criteria set out in the self-assessment such as diversity because of the regional constraints on a law firm. “You can’t apply too broad a brush,” he says.

Kevin Filkow, who has a four-lawyer firm, Filkow Law, says he isn’t sure having hard and fast policies that are written down in smaller firms is needed. “If someone has a problem, they come to me,” he says, adding that the lawyers talk every day. “In small firms, problems surface fairly quickly.” The small number of employees results in a speedy resolution. 

“Having small firms create these policy and procedures might be a good thing and really might be negative make-work projects that aren’t meaningful,” he says. When policies are written down, there is always a variation and that should be dealt with through discussion anyway, he says. He is skeptical that every scenario can be covered by policy.

Most lawyers in small firms are concerned about how to provide better legal results and maintaining the standards of the profession, says Filkow, and they rely on law society conduct rules and practice advisors for guidance when problems arise.

Walker says a fundamental concern is that the policies and procedures that come about through the use of the tool match the objectives that prompted registration and regulation of law firms. 

“The whole concept that you want to measure is whether regulation reduces the number of complaints to the law society,” he says.

Approximately 85 per cent of the complaints lodged with the LSBC, according to its Performance Report for 2017, were withdrawn, not within the LSBC jurisdiction, mediated by staff or resolved in some way. Only 15 per cent demanded further action.

If at the end of the day, the LSBC — and firms — field fewer complaints, then regulation and registration of law firms and having policies and procedures in place has succeeded, he says.