BETWEEN MARKET AND STATE: THE LEGAL PROFESSION IN TURMOIL1

Published date01 May 1989
Date01 May 1989
DOIhttp://doi.org/10.1111/j.1468-2230.1989.tb02600.x
THE
MODERN LAW REVIEW
Volume
52
May
1989
No.
3
BETWEEN MARKET AND STATE:
THE LEGAL PROFESSION IN TURMOIL’
PROFESSIONS are unique social configurations, which flourished with
the emergence of the liberal state and the rise of
the
bourgeoisie.
In
their classical forms, independent producers served individual
consumers while acting collectively
to
improve
the
ethics and
ensure
the
competence of their peers. Professions persuade the
state
to
protect them from market forces by arguing that
commercialism
is
inconsistent
with
their noble calling. At the same
time, professions invoke market imperatives
to
resist state control,
insisting that they must preserve their “independence” in order to
serve their clients loyally.
Recent events have challenged the ability of the legal profession
to maintain its balance on the tightrope stretchea between market
and state. On one side, the state
is
asserting greater control as
both regulator and consumer
of
legal services. Government
decisions concerning eligibility for and funding of legal aid,
responsibility for criminal prosecution, the structure of the judicial
system, higher education, substantive law, and competition policy
deeply affect lawyers. These pressures are visible in the Legal Aid
Efficiency Scrutiny, White Paper, and subsequent legislation, the
Civil Justice Review, the Department of Trade and Industry Green
Paper on restrictive trade practices policy, and, most recently, the
three Green Papers by
the
Lord Chancellor’s Department
(Conveyancing, Contingency Fees, and Work and Organisation).
On the other side, social and economic forces are reshaping
the
profession at a constantly accelerating tempo, changing the numbers
and characteristics of those who seek to become lawyers, the,
I
I
am gratcful
to
thc
Institute
of
Advanccd Lcgal Studies, thc Law Dcpartmcnt
of
thc
London School
of
Economics, thc Law Socicty, and thc Lcgal Action Group for thc
opportunity
to
discuss somc
of
thc issucs raiscd in this articlc during a visit in Dcccmbcr
1988.
A grant
from
thc UCLA Acadcmic Scnatc supportcd that trip. Numerous pcoplc
have kept mc informcd about cvcnts
6,000
milcs away: William Allcn, Gcoffrcy
Bindman, Kim Economidcs, John Flood, Ncil Kibble, Michacl McConvillc, Waltcr
Mcrricks, John Pritchard, David Sugarman, and Carolc Willis. Bccausc
of
limitcd space,
I
have omittcd all rcfcrcnccs;
I
hope an cxpandcd and fully documented vcrsion
of
the
English data will appcar in
a
rcviscd cdition
of
my book.
The
Legal Profession in
England and Wales
(Basil Blackwcll,
1988);
lhc comparative Amcrican data arc in my
book
American Lawyers
(Oxford Univcrsity Press,
1989).
285
286
THE
MODERN
LAW
REVIEW
[Vol.
52
nature and quantity of demand for legal services, the degree of
concentration among producers and consumers, and
the
intensity
of competition inside and outside the profession. In this article
I
examine the forces impinging on the profession and its response
with respect to
six
issues: the difficulty of controlling supply,
competitive pressures toward oligopoly,
the
lures and pitfalls of
demand creation,
the
dangers of monopsony, the reconfiguration
of the profession, and public accountability.
I.
THE
DIFFICULTY
OF
CONTROLLING SUPPLY
The explosive growth of academic legal education in the 1960s and
1970s significantly undermined professional control over
entry.
Both branches repeatedly expressed deep concern about “over-
crowding.” Yet just a
few
years later solicitors are bemoaning the
“recruitment crisis.” What explains this dramatic reversal? One
possibility is the inevitable lag between fluctuations in demand and
supply caused by imperfect information and rigid entry barriers.
After a very brief post-war boom, difficult professional examinations
and a lengthy apprenticeship reduced the annualised growth to just
1.2 per cent. from 1952 to 1962. Following more than 20 years of
rapid growth, the pace has slowed once again. Although the
number of practising certificates grew at an annualised rate of 5.3
per cent. from 1975/76 to 1985186,
it
grew only 1.7 per cent.
between 1985 and 1986 and an annualised 2.5 per cent. over
the
next two years. The number of new articles
in
1987/88 was identical
to that in 1985/86.
This was entirely predictable. Much of the expansion of law
school enrolments was attributable to the entry of women; once
they
equalled
the
number of men that source of growth vanished.
Indeed, the absolute number of male law students peaked
in
1974
in
universities and two years later
in
polytechnics and has been
declining ever since-as
it
has in
the
United States. Government
cuts
in
real spending on higher education (particularly in the social
sciences) kept the number of university law graduates from United
Kingdom domiciles virtually constant between 1983 and 1987. Only
about 60 per cent. of those with undergraduate law degrees take
the Law Society’s Final the following year, and only 60 per cent. of
those pass. Salaries for articled clerks and assistant solicitors
compare unfavourably with those in other occupations open to arts
graduates. There has been a substantial drop in entry by mature
students, legal executives, and school leavers, from more than 200
between 1982 and 1984 to fewer than 100 today. Although entry by
graduates in other subjects has increased from about 300 to more
than 400, further expansion is limited by the number of places and
cost of the CPE course and the inadequacy of local authority
grants. Most polytechnics offering CPE courses receive
500
applications for fewer than
50
places, and the number rejected by
MAY
19891
THE LEGAL PROFESSION IN TURMOIL
287
the College
of
Law more than doubled between 1981182 and
1987188 (from 169 to 359).
There
is
not much the profession can do to expand entry. The
demographics are unpropitious: the population under 25 declined
9.2 per cent. between 1970 and 1986, and the number
of
18-year-
olds
is
expected to drop 35 per cent. between 1983 and 1994.
Government is not going to expand undergraduate education or
mandate funding for professional training. Indeed, local authorities
are cutting back grants for the CPE course, especially since the
College
of
Law charges three times as much as polytechnics. The
College
of
Law has expanded the number
of
places for the Finals
course, and the Law Society is considering part-time and
correspondence courses. But this
is
not going to relieve the earlier
bottlenecks. One (unpopular) solution to the supply shortfall would
be for solicitors to work harder. Principals in two smaller London
firms billed 1,100 hours a year; American law firm partners
generally bill 50 per cent. more and expect their associates to bill
twice as much.
The problem is the distribution as well as the number
of
lawyers.
Starting salaries for articled clerks in private practice varied
between the €6,000 Law Society minimum and more than €14,000,
depending on firm size and location, and were growing twice as
fast in London as in the Midlands. Average fees per principal were
about twice as high in London as in the North and growing more
than twice as fast. In response, the proportion
of
solicitors
beginning their careers in greater London rose from 41 to 50 per
cent. between 1984185 and 1987188. There were twice as many
articles per principal in London (0.16) as in the North (0.10) or the
South (0.08). Among a sample
of
university undergraduates
intending to become solicitors, 70 per cent. expected to article in
London. The number
of
principals grew two or three times as fast
in London between 1985 and 1987 as it did in the North. In
1986187, the North, the Midlands, and Wales together contained 53
per cent.
of
the population but just
31
per cent.
of
assistant
solicitors; the old GLC contained only 14 per cent.
of
the
population but 44 per cent.
of
assistant solicitors. Because private
practice and employment in commerce and industry pay
so
much
better, central and local government and the recently established
Crown Prosecution Service remain chronically understaffed, unable
to recruit at the salaries and conditions they offer.
The Bar was less affected by the expansion
of
academic legal
education because it controlled supply more through pupillage and
tenancy than examinations. Since women find the Bar less
hospitable, they did not contribute
so
significantly to its expansion
(they are slightly more than a third
of
those passing the Bar
examination but half
of
new solicitors). Even
so,
the growth
of
practising barristers also has been declining, from a high
of
8.3
per
cent. between 1974 and 1975 to an annualised 2.6 per cent.

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