President's Page--On Solos, Small Firms and MDPs
I practice in a firm of six lawyers. About 75 percent of private practitioners in Michigan are in small firms similar to mine, or are solo practitioners. What does MDP mean to us?
Multidisciplinary Practice, or MDP: a lawyer and a nonlawyer sharing ownership in a firm or sharing fees.1 Now, both are prohibited under our Rules of Professional Conduct. There are various permutations of MDPs, from simply hiring nonprofessionals as employees to full joint ownership.2
Some lawyers think MDPs in fully integrated form are to be fought at all costs; arguing that otherwise our core-value ethical rules on confidentiality, independence and conflicts of interest will be lost, forever diminishing our profession. Those core-value ethics must never be compromised, but we should not allow that to prevent us from conducting a full examination of MDPs and other innovative methods of delivering legal services.
Many lawyers view MDPs only as a big law firm issue, a contest with the big accounting firms for lawyers and clients. That is wrong. It is also a small firm issue.
‘‘The vast majority of multidisciplinary practices would be Main Street practices,’’ is the prediction of Susan Hackett, Senior Vice President and General Counsel of the American Corporate Counsel Association. The General Practice, Solo and Small Firm Section of the American Bar Association recommends that MDPs be allowed in some form. For another perspective, the impact on small firm CPAs, see the sidebar article by Dennis Echelbarger, Chair of the Board of the Michigan Association of Certified Public Accountants and a valued member of our MDP Committee.
What do our clients think?
Consumer groups told the ABA’s Commission on Multidisciplinary Practice the following:
American Association of Retired Persons [AARP]:
A lot of people, especially in the elderly community, go to problem helpers rather than lawyers, e.g., case management/social worker intervention services, money management services, complaint letter writing, or medical bill assistance. For legal services, the problem is not that people cannot find the lawyer they want or cannot afford the one they find, but that people do not look for lawyers in the first place when they have a legal problem. A 1994 ABA survey reports that 61 percent of moderate-income and 71 percent of low-income people who could benefit from an attorney’s services did not consider using one. [Emphasis supplied.]
National Resource Center for Consumers of Legal Services:
The legal profession has been put on the defensive by people who have more freedom to design and market their services.
Consumers Alliance of the Southeast:
The average person is intimidated by lawyers, worries about being taken advantage of, is concerned about the expense of just talking to a lawyer, and generally can’t see the positive benefits of having any kind of relationship with a lawyer. But MDPs offer an opportunity to re-cast the legal profession as part of a problem-solving team whose primary goal is finding integrated, efficient and effective solutions to the everyday problems that confront all consumers, and give consumers more choices....
Most people only visit a lawyer in a hostile, adversarial situation often consulting a lawyer only as a last resort. Consumers and small business owners see advantages in having access to integrated professional services....[Emphasis supplied.]
Potential clients think we are inefficient and too expensive. Hourly rate billing is not designed to assure clients of the greatest value at the least cost. We are, and have been, penalized in the market place by that public perception, even though we know that clients get good value for the fees we charge. Nonlawyers have been carving chunks out of the preserves we once thought were reserved for lawyers. Often, they do it by better marketing and pricing, or by associating with others to provide an integrated, complete solution to a client’s problem. Prosecuting unauthorized practice of law claims will not solve that problem. Under the able leadership of Chair John Anding, the UPL Committee is taking a fresh, hard look at the unauthorized practice of law, but case by case prosecution is slow and cumbersome at best.
We need to change. We need to recognize that, for many of us, our major competitors are not just the other lawyers in our fields of practice, but also nonlawyers. Change is difficult. But we lawyers are resilient.
MDPs present opportunities for small firm and solo practitioner lawyers. For instance, a client and a lawyer may mutually benefit from an MDP between
•A family law practitioner and a psychologist
•A real estate lawyer and a surveyor, or a real estate appraiser, or an architect
•A business lawyer and an accountant
•An estate planning and probate lawyer and a financial planner, or a benefits specialist
•An employment lawyer and a compensation specialist
•An environmental lawyer and an environmental scientist
Dick Rassel, the exemplary chair of the MDP Committee, is devoted to informing all Michigan lawyers, not just big firm lawyers, about MDPs. Dick and the members of his committee are diligently at work, seeking feedback on MDPs from all State Bar committees and sections. You too can provide input.3
Think about how MDPs, and other methods of delivering legal services, could affect your practice: the opportunities and the detriments. Think entrepreneurially. Think about innovation. Think about e-lawyering, for example. Then let the MDP Committee know what you think. Feedback is critical. In May, the MDP Committee will issue its report to our membership, describing how MDPs could impact our practices. Think about it. Now is the time to be expansive in your thoughts.
I have been contemplating the future of our profession. I am convinced that lawyers will flourish in the 21st century, but in ways different than today. In every community, lawyers are among the smartest, best educated, hardest working, and most energetic, articulate and creative. Lawyers simply need to recognize the need to change. Then do it.
How the MDP issue will be resolved, I cannot predict. I do know that, if we close our minds to change, our profession will suffer from self-imposed stagnation.
After all. Ultimately, the public will decide.
1. The ABA Commission on Multidisciplinary Practice defined MDPs as: ‘‘Multidisciplinary Practice [MDP]’’ denotes a partnership, professional corporation, or other association or entity that includes lawyers and nonlawyers and has as one, but not all, of its purposes the delivery of legal services to a client(s) other than the MDP itself or that holds itself out to the public as providing nonlegal, as well as legal, services. It includes an arrangement by which a law firm joins with one or more other professional firms to provide services, and there is a direct or indirect sharing of profits as part of the arrangement.
2. To learn more about MDPs, see the pro and con articles published in the January issue of the Bar Journal, pp 64-72, click on MDPs at the SBM website under the ‘‘Committees’’ button, and look at the videotape of the January 22 MDP panel discussion.
3. Send your comments to Richard E. Rassel, 150 W. Jefferson #900, Detroit, MI 48226. A copy should also be sent to Victoria Kremski at the State Bar.