Law Times

PAGE 2 NEWS December 6, 2010 • Law Times LSUC fees to increase 2.8% But modest rise sparks fears of future financial reckoning BY MICHAEL McKIERNAN Law Times fees as it passed its 2011 budget amid fears it could be merely putting off a fi nancial reckoning further down the line. Lawyers will pay an annual T levy of $1,785 in 2011, up 2.8 per cent or $49 from this year. Th e fee for paralegals will rise by $24 to $957 for a 2.6-per- cent increase. But in order to keep the increase low, the law society dipped into its compensation and general funds to the tune of almost $5 million. It's also using a further $2 million in invest- ment income from the errors- and-omissions fund to reduce the amount lawyers owe. Without those measures, the fee increase could have topped he Law Society of Upper Canada approved mod- est increases in its annual $200 for lawyers, a rise of more than 10 per cent. Bencher Gary Gottlieb, who voted against the budget, worried the fees are artifi cially low. Th e budget will leave the compensation fund with a pro- jected $22.5 million by the end of next year, while the general fund will have less than $2 mil- lion in reserves by then. "My major concern is that this budget only prevents a judg- ment day which is ultimately going to come," Gottlieb told Convocation. "What's going to happen when we don't have these amounts to allocate to mitigate fee increases?" Bencher Bradley Wright, a member of the fi nance commit- tee that drew up the budget, said benchers and staff shared Gott- lieb's fear of a coming judgment day but noted they recognized the diffi cult economic situation many people are facing. see what happens in years hence but we do have other funds as well if we need them." Th e largest increase in expen- diture is for professional devel- opment and competence, which refl ects the demands of the law society's new educational require- ments for lawyers. Th at depart- ment's budget will increase by $2.2 million, or 12 per cent, as the law society prepares to in- crease the output of its continu- ing professional development program by 70 per cent. Spending on professional reg- Gary Gottlieb suggested a graduated fee system based on lawyers' income. "It was felt that the fee this year, while it had to go up, should not go up too much, and that's a refl ection of the slowly rebounding economy," Wright said. "We'll have to wait and ulation also jumps by $1.2 mil- lion. "Unfortunately, complaints continue to grow," said fi nance committee chairwoman Carol Hartman, who noted complaints against lawyers have increased by 20 per cent since 2007. Not only are there more complaints but a higher propor- tion of them are "more serious and more complicated," which makes it diffi cult to resolve them quickly, Hartman added. Bencher Carl Fleck, another fi nance committee member, de- fended the budget, saying the increases simply refl ected prior- ities dictated by Convocation. "Th is is a progressive law soci- ety, as I see it. Either we stand still in our development of what we think the climate for practis- ing law in this province is or we carry on as we have been." Fleck pointed out that next year's levy will be virtually iden- tical to the fee paid by lawyers in 2001. "I think we've done pretty well," he said. But Gottlieb insisted the law society is spending beyond its means. "We're either doing too much regulation or, if the regula- tion we are doing is necessary, we simply can't aff ord to do it to the extent we are doing it," he said. In Gottlieb's view, the law so- ciety should be doing more to re- duce the burden on low-income lawyers. "Many of them cannot aff ord to pay the fees," he said. 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As a result, he suggested a graduated fee system based on income could help lawyers out. "I think it's only fair," he said. But Wright, a sole practitio- ner, dismissed that idea, saying a fl at-fee system is much cheaper to implement. "Lawyers in the larger fi rms do not draw on the resources of the law society to anywhere near the extent that my demographic does," Wright said. "Th at means that the lawyers in those fi rms are, in fact, subsidiz- ing the fee that I pay." Th e budget also included a 10-per-cent boost for bencher pay to $550 from $500 per day. According to Hartman, the increase was simply an eff ort to take into account the eff ect of infl ation since 2004, when bencher remuneration began. Last year, the law society rolled rates back to 2004 levels in light of the tough economic climate, but that was "never meant to be permanent," Hartman said. But Bencher Th omas Heintz- man was uncomfortable with the timing of the raise. "Many of the members of the profes- sion are suff ering out there, and I question whether this is the time to be doing it," he said. He also questioned wheth- er the law society was doing enough to show the profession it's acting as effi ciently and cost- eff ectively as it can. "My law fi rm has to do more For a 30-day, no-risk evaluation call: 1.800.565.6967 Canada Law Book, A Thomson Reuters business. Prices subject to change without notice, to applicable taxes and shipping & handling. www.lawtimesnews.com OLPB_2011 LT-1/2pg 4X.indd 1 11/9/10 3:41:59 PM HA1210 with less," he said. "Th at's a fact of life. And I just am concerned that we don't have adequate evidence to demonstrate that we're doing more with less. If I understand it, we're having 30 new full-time equivalents more this year than last year. Th at's just contrary to the trend at my law fi rm." LT Multiple copy discounts available

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