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History was made today in California. Governor Jerry Brown signed Senate Bill 36, unprecedented legislation that required painstaking effort the past two years to realize. Bar reform failed in 2016 but this time was different. The legislation sailed through both legislative chambers.

SB 36 increases the California State Bar’s focus on its core regulatory functions — public protection, admissions, licensing and lawyer discipline. It accomplishes this by requiring the California Bar to transfer its 16 specialty sections (with more than 60,000 members) and the California Young Lawyers Association (with its 48,000 members) to create what becomes the nation’s second largest voluntary association of lawyers after the American Bar Association.

The functions and activities of the existing Sections will become a part of a new private, non-profit corporate entity, defined as the Association. The Association will be governed by a board of directors selected by the individual sections themselves. It is not part of the State Bar. Moreover, the Association is prohibited from being funded by membership fees and is not considered a state, local, or other public body for any purpose.

Membership in the new organization is strictly voluntary. It will receive no funding from the State Bar’s mandatory membership fees – though members will have the convenience of continuing their Section membership as the Section dues check-off will remain on the State Bar dues statements.

Focus on public protection

Under the new law, the implementation process begins January 1, 2018. The current 19-member State Bar governing board will transition to a 13-member board with a maximum of 6 non-lawyer public board members. Unlike the current State Bar Act that required the board to elect or select the president and vice president, the new law requires the California Supreme Court to appoint a chair and vice chair. The State Bar is also required to adhere to a Supreme Court-approved policy to identify and address any proposed board decisions that trigger antitrust concerns. Read the entire bill text here.

Two-headed Bar

Meanwhile back in the Arizona desert, similar legislative efforts to carve out the regulatory from the non-regulatory functions of the Arizona Bar continue road-blocked. Arizona Bar bureaucrats and entrenched establishment interests have strenuously fought any proposed bar reform legislation. More recently, the Bar opposed a rule petition that would have split the functions of the Arizona Bar into two distinct subsets, a mandatory membership organization (“Mandatory Bar”) and a purely voluntary membership organization (“Voluntary Bar”).

In Arizona — and what will soon no longer be the case in California — the Arizona Bar has two heads. It acts as both regulator protecting the public from unethical lawyers — while at the same time acting as the trade association looking out for the interests of lawyers. This creates a conflict of interest. The interests of the public and the interests of lawyers are not the same.

In California, the Sections had for decades been a part of the regulatory umbrella of the State Bar. During that time the Sections worked on behalf of lawyer interests providing them trade association-like benefits and services.

But unlike Arizona and other reform-resistant jurisdictions like Washington and Wisconsin, the separation of regulatory from non-regulatory functions was finally accomplished only through collective effort. The bill signed by California’s governor today came about through collaboration by the legislature, the State Bar, the Supreme Court’s Chief Justice, the Sections and other stakeholders working together to make history.

Only time will tell whether California’s hard-fought success now helps to put two-headed bars in other states not just on notice —  but on the block.

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