What if Lawyers Had an Ethical Obligation to be Efficient?

What if lawyers had an ethical obligation to be efficient, and that failing to work as efficiently as ‘reasonably possible’ could lead to disbarment and/or financial penalties? One thing is for certain, market change would be hugely accelerated.

First, what is meant by being efficient? Scientifically it is defined as: ‘Efficiency = useful power out / total power in’. But in the legal workplace where the outputs are intellectual, e.g. a contract, the closing of a transaction, or the response to a claim, it’s a bit more subjective.

However, in terms of the legal world, more efficient must mean ‘doing X more quickly and/or less expensively for the client than previously’.

So, on that basis, the legal inputs that we have, include:

– the intellectual capital of the people involved, which is brought to bear on that matter via their personal experience, talent, and skill as trained lawyers, (and this can include paralegals, PSLs, and all other people engaged in actual legal service provision across ALSPs, law companies, law firms, in inhouse teams, or working in other ways.)

– plus the physical human effort and time needed to make that work happen, including ancillary, or admin/secretarial work such as proofing, reviewing, and communicating;

– plus the technological and data leveraging work, e.g. KM-based support, such as research and retrieval, i.e. accumulated knowledge that can be drawn upon, and software tools that support drafting, proofing, reviewing, negotiating, information sharing, and communication. These tools and approaches, in particular, drive efficiency.

At present ‘lawyers’ (i.e. all those involved in the direct legal inputs) are really great at the intellectual capital and human effort side of things, and that’s clearly a massive positive for the profession as a whole.

The third bit, the tech and data leveraging…well, taken as a whole profession globally, they’re about on the same level as the general public, (and sometimes behind), i.e. use of standard productivity tools such as Word and email, or the use of e-signatures. And of course some firms are way ahead, which this site covers every week, but they are not the norm.

So, what if rather than just generally expecting lawyers to keep up with broader technological trends in the wider world there was a specific ethical obligation to be efficient?

Efficiency In The Law

What would an efficiency rule look like? For this site it would have to be something like this:

  • 1.1. A lawyer will always seek to be efficient in their work for a client, where reasonably possible, with the lawyer conducting work in the most efficient way available at that time.
  • 1.2. A lawyer will always seek to find more efficient ways to provide their services and work product to their clients, and given a reasonable choice between two methods of delivery will always choose the most efficient, unless the client – who has been fully informed of this choice – states that they are indifferent.
  • 1.3. Given that efficiency can be driven by improved methods of legal production, lawyers have an obligation to explore the full spectrum of legal service providers (i.e. the right people and organisations) for a matter, as well as make use of technology to improve delivery where reasonably possible.
  • 1.4. Intentionally not seeking to be efficient for a client would be regarded as an ethical breach.

At present in England & Wales, (see SRA rules below), there is no demand that lawyers are ‘efficient’. They have to make sure that work is done in a ‘timely manner’ and you have to make sure you are competent to do that work. But, that is basically saying: don’t miss deadlines or make clients wait too long, and please try and keep up with what the law is and how current legal processes work.

Let’s not get too much into any particular nation’s approach, but it’s likely to be the case that few, if any, jurisdictions demand, on an ethical basis, that lawyers must drive efficiency, i.e. to place efficiency on the same level as protecting client confidentiality or staying up to date with current legal requirements.

What Would This Look Like?

If this was the new reality, what would it look like? For law firms, and the owners of any legal service provider, it would fundamentally mean that any piece of work had to be considered in terms of efficiency and whether the current approach was meeting the client’s needs.

So, this might mean an obligation to invest in legal technology that helped with transactions, for example. It may also mean that a law firm had an ethical obligation to always have on offer ALSPs, law companies, or their own process groups, to help with projects.

When new technology came along that was faster at providing the same output, then lawyers would be obliged – when reasonably possible – to integrate it into their service provision.

When new ways of working evolved, likewise, lawyers would be obliged to offer this approach to their clients – also when reasonably possible.

And the same goes for inhouse lawyers who are serving the real client, i.e. the owners of the business they are employed at. They would have an obligation not to work inefficiently in their own team, nor engage inefficient methods of work provided by external parties. So, the effect of the rule on efficiency would be doubled.

Measuring Efficiency

But, there is a snag. One lawyer’s sense of efficiency would be another lawyer’s idea of taking things way too far. For example, lawyer A works in a very tech-forward law firm and they wield every legal tech productivity tool you can possibly want, along with having invested in great KM capabilities, and have built their own process group, along with developing very close working relationships with a range of ALSPs and law companies.

They’ve also experimented with doing as much work off the billable hour as possible, at least for more simple matters, as they’ve found that this tends to implicitly drive up their efficiency.

The clients really love this firm as they are sophisticated and their inhouse team have their own ethical obligations to be efficient, and so working with this firm helps them to keep compliant.

Now, take lawyer B. They work at a firm that is still in effect operating in the mid-1990s. They use Word and email and that’s about it. They tend not to offer clients any other means of producing a work product unless the client demands it explicitly and even then they are not excited about that. They also tend to work with inhouse teams that are, to put it politely, not really that bothered either about the efficiency obligation to their client.

Which is in the right? Are they both OK? How would a regulator decide? The answer is that in the real world it would be a bit like the point about being ‘timely’. The SRA doesn’t spell out a 1,000 permutations of what timeliness looks like, it’s a broad goal, and if clients think you’re really not doing this then they have a right to be upset.

Probably the same would have to be true of any rule about efficiency. So, a client (i.e. the real client, the owners of the business) would have to be rather annoyed by an outcome. Maybe it was too slow, maybe it was what they thought was too expensive, or unnecessarily expensive, given the multiple possible ways that work could have been provided at the same quality?

If they were upset then that would eventually turn into a regulatory spat and things would go from there. Of course, in 99% of cases things would not escalate to such a point. The clients would simply make it known that they didn’t want to use that firm again, or at least not in that way for that type of matter, (or maybe they’d be passive aggressive and not explain it…?).

Eventually, the sense of needing to change technologically and provide options to clients would become embedded across the market. Perceptions would evolve and that would be a healthy thing. Personally, I think the SRA’s approach of providing broad goals for lawyers to aim for is the right one, rather than trying to detail every possible permutation. I.e. It’s about the spirit of the rules.

A rule for promoting efficiency would therefore not have to be heavy-handed or onerous. It would simply be a constant encouragement.

SRA Code of Conduct section 3 – Service

  • ….you are subject to the overriding obligation to protect your client’s best interests.
  • You ensure that the service you provide to clients is competent and delivered in a timely manner.
  • You maintain your competence to carry out your role and keep your professional knowledge and skills up to date.
  • You consider and take account of your client’s attributes, needs and circumstances.
  • Where you supervise or manage others providing legal services: you remain accountable for the work carried out through them; and you effectively supervise work being done for clients.

By Richard Tromans, Founder, Artificial Lawyer, Feb 2022.

(Main pic: screen shot from the SRA website, with a search for ‘efficiency’, which had no results.)

5 Comments

  1. To my knowledge, nobody has come up with a definition of ‘efficiency’ in services provision. I am efficient is an easy claim to make, and an easy claim to refute. I have worked on the following model: ‘Do we know what should have happened, do we know how it should have happened? After the work is done, can we retrospectively say that the right thing happened? If the customer is not happy, can we say what did happen was the absolute right and best thing (and categorically why that is so). If we failed, can we categorically say how the failure arose? And, if so, can we learn from that? To do this is a large science and engineering task as well as an educational and relationship challenge. The other end of the scale is pure ‘trust’, but sometimes that can be even harder to come by these days.

  2. This is a very interesting point. It seems to me, though, that there is a strong argument that a lawyer’s general obligation always to act in the best interests of their client must surely imply an obligation to deliver legal services in a cost-effective way. Would it not be a breach of the lawyer’s duty to their client if they deliberately chose a slower process just so that they could charge higher fees?

  3. The common law standard is effectiveness of counsel. Often times effectiveness and efficiency are at odds. This a a common problem in business. The article does not articulate how you would balance the two competing standards. Right now lawyers have a clear obligation to invest whatever it takes to get the client the outcome they desire. If this means writing a motion that has a 10% chance of success they should clear do it even though it is not an efficient use of their time.

  4. Ask a group of partners to anonymously respond to this question: “What percentage of your work could you delegate to a junior to do, given that the junior was trained to do the work with quality?” Now prepared to be shocked by the answer. I have personally done this at retreats dozens of times and the average is about 70%! Now STOP the bullshit about Efficiency and just impose a non-negotiable rule. Any client matter that could be delegated MUSZT be delated – or your billable numbers will be stripped out of your personal column.

  5. Thanks Richard. This is an interesting article with some very strong points. It is very difficult to regulate for “efficiency” and we always must be careful, as Dan points out, not to put cost and time above all else. That said, with the exponential growth and use of “legal tech” is it not time that the SRA rules were updated to accommodate the changing legal world i.e. should a provision be added to Section 3 of the Code of Conduct to say something like “You remain up to date with technology advances in the legal sphere and use reasonable endeavours to use technology where to do so would be in your clients’ best interests.”

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