Is Legal Process Outsourcing an Ethical Practice?
A man without ethics is a wild beast loosed upon this world. - -Albert Camus quotes
Since time immemorial, the legal profession has been acknowledged as the “Nobel profession’’. The reason why legal profession was braded so was because of the firm emphasis made on ethical aspects in the profession. “It is a pleasant world we live in, sir, a very pleasant world. There are bad people in it, , but if there were no bad people, there would be no good lawyers” said Charles Dickens. Lawyers were often meant to be the rescuers of the wounded. Thus , the nobility of the profession was seldom questioned. However, changes in the nature of practice of law have raised up queries questioning ethics in such practices. Outsourcing and Offshoring of legal process is one such practice that has been vehemently criticized for being unethical whilst the patrons of Legal process outsourcing have defended it with commendable justifications.
What is Legal Process Outsourcing?
LPO is the process of obtaining legal support services from an external unit. By, obtaining support services from an outside firm, the outsourcer firm relishes several advantages. If it is from an outside country, it is called as ‘’offshoring’’. “Legal process outsourcing refers to the offshoring of different elements in the legal process by law-firms, corporations, and in-house legal departments (mainly in US and UK) to offshore centres (mainly in India). The object behind the outsourcing is to capture the opportunities prevailing in the external environment. In case of off shoring, the outsourcer shall be deprived of certain benefits and privileges which the outsourced shall be entitled to. Thus, the outsourcer can stay at one place and reap the benefits existing at two different environment.
Reasons for Outsourcing in India
India is the top notch destination for legal outsourcing from U.S.A and U.K. The service sector in India accounted for about 52% of GDP in 2004-05. In fact India’s service exports had more than doubled from US$ 25bn in 2003-04 to US$ 60bn in 2005-06 and now accounts for nearly 37% exports. As Indian nation is geographically situation in a time zone exactly distinctive of these two nations, it facilitates the firms in the U.S.A and U.K to work round the clock. Secondly, Indian law has been inherited from the United Kingdom during the Colonial era, therefore similarities in issues of law diminishes ambiguity to a commendable extent. In addition, English is considered of pivotal importance in India and priority is given to learn and speak English than the native languages. The linguistic deftness and familiarity in English makes Indians more demanded in the Outsourcing Industry. The cost of labour is another highlighting reason as to why India is preferred. As a result of such factors, the Westerners use India as a major player in the outsourcing Industry.
What is Outsourced?
The quality of legal work outsourced to India has vastly improved over the years and now a majority of work includes high end services such as End to End E-Discovery Management (Litigation and Regulatory Reviews), Legal Research, Drafting of Pleadings, IP services, Compliance &Due Diligence and End to End Contract Management. In End to End discovery management collection of electronically stored information, processing and reviewing by a team of lawyers to code relevant documents to a particular case or regulatory enquiry. The offshore legal team aids the US legal firm in decision making as to whether it would be appropriate for their clients to go to trial or settle out of court on the basis of the review findings. Contract management involves managing the life cycle of a contract. This includes an extensive use of technology and a perpetual service for clients from the time the contract is redlined until the expiry of the contract. In the field of Intellectual Property Rights aspects such as trademark search, Copyright search, technical research, registration and proof reading are outsourced. Legal research on case laws, legislations and statutes pertaining to a particular case is also outsourced.
Ethical Arguments against Legal Process Outsourcing
1. Unauthorized Practice of Law:
The first and foremost criticism of ‘’Offshoring’’ on ethical grounds is that a part of the legal practice is performed by persons without authorization. The outsourcer may have an authorization, however the agency to which the legal work has been outsourced will not have authentication or authorization as it it geographically located in a place beyond the jurisdiction of the outsourcer. Thus it can be argued that the outsourcer aids and abetts unauthorized practice. American Bar Association’s Model Rules of Professional Conduct states as follows in Rule 5.5 ; -
A lawyer shall not practice law in a jurisdiction in violation of the regulation of the legal profession in that jurisdiction or assist another in doing so.’’ limiting the practice of law to members of the bar protects the public against rendition of legal services by unqualified persons.’’
For an illustration ; An Indian attorney is unallowed to practise or to represent any client outside India. In case of Offshoring, America obtains service support from an Indian attorney for an American Client. This is on perspective would amount to abetment of unauthorized practice of law by the American Firm.
However, jurists are of the opinion that Indian is often an ‘’outsourced’’ and it is governed by the Advocates Act and the Bar Council of India Rules
2. Breach of Confidentiality; -
The legal profession thrives on confidentiality. Confidentiality and Security have always been an integral possession of the the relationship of lawyers and his clients. It could even be stated that confidentiality would be the foremost factor that makes the attorney-client relationship very delicate. Contrastingly , in the case of the LPO, the confidential information is transmitted by the outsourcer to an outsider firm thereby breaking the strands of confidentiality in the Attorney-Client relationship. The question of whether the information transmitted is irrelevant in ethical point of view by few scholars who emphasis that one of the important tenets of legal professional ethics is Confidentiality.
If Client Confidences and Secrets are to be Disclosed. MRPC 1.6 Confidentiality of Information (a) A lawyer shall not reveal information relating to the representation of a client unless the client gives informed consent, the disclosure is impliedly authorized in order to carry out the representation or the disclosure is permitted by paragraph (b).
To combat the criticism of lack of confidentiality Confidentiality agreements are being utilized. Albeit there are additional safeguards undertaken to prevent breach of confidentiality through world recognized standards and certifications, small sized LPOs are maimed due to credibility issues when pursuing clients.
3. Billing for Outsourced legal support
Another practice in case of legal outsourcing which is vehemently criticized is the billing for external legal support. The outsourcer hires external legal aid for considerable advantages such as cost and time. However, when he bills the client for the advantages he enjoys, it could be termed unfair and unethical. This criticism can however be vitiated if the Outsourcer himself bears the expense of the fruits he enjoys.
4. Conflict of Interests
Conflict of interest occurs when an LPO undertakes a project, consciously or unconsciously, which is detrimental to the interest of the client. However, in order to ensure that there is no conflict of interest, credible LPOs conduct a thorough conflict check prior to undertaking a project and also reject client work in case of a conflict. To combat these cracks and crevices, LPOs take adequate precautions by requiring attorneys to sign Non-Disclosure Agreements and moreover maintain a database of attorney profiles and their past project experiences to validate any conflict.
5. Incompetent Representation
As noted above, proper supervision is required to ensure your client is adequately represented. Conduct the necessary due diligence to ensure the LPO delivers the necessary level of competence. Interview the company in advance, obtain references for both the company and the individual who will be doing the work, request sample work product, and communicate directly with person assigned to your project to discuss to ensure he/she understands both the assignment and ethics involved.
Ultimately, LPO’s are an impeccable system of generating work and employment. It also serves as an outstanding mode of extending legal services globally and an efficient and effective technique to minimize the cost and to improve the quality of legal research and work. However, as discussed earlier there are several criticisms against the functioning to LPO’s around the globe. Arguments on ethical grounds cannot be avoided as ethics, morality and law are different pages of the same book. While ethics is the branch of knowledge that deals with moral principles, professional ethics is the personal and corporate rules that govern behavior within the context of a profession. As the ambit of profession has been diversifying and complexing over several years, the concern for ethical practices have arisen. Therefore, there is a necessary requirement for a standard set of rules or regulations to govern the function of legal outsourcing. The American Bar Association and the United Kingdom bar have been much ahead of us in formulating a professional code of conduct with regard to Legal Process Outsourcing. On the contrary the Indian Advocates Act or the Bar Council Rules have absolutely no mention about Outsourcing. To obtain a more holistic monitoring of the Legal Outsourcing activities there has to be either a regulatory or a statutory instrument such that unethical and undesirable actions could be remedied and regulated.
# Legal Process outsourcing: Can offshoring of legal services to India be both efficient and ethical? Maya Karwande. Legally yours blog.
# India 2007. Ministry of Information and Broadcasting Government of India
# “Will tough economy push companies to outsourcing” David Hechler
# “Offshore Legal Outsourcing: the Ethical Implications,” (LawScribe MCLE Course handout), LawScribe, Inc. [Glendale, CA], 2007.
# MODEL RULES OF PROF’L CONDUCT R. 5.5 (2003).
# ABA Comm. on Ethics and Prof’l Responsibility, Formal Op. 88-356 (1988)
# American Bar Association “Model Rules of Professional Conduct,” http:// www.abanet.org/cpr/mrpc/mrpc_toc.htm
# ‘’The Ethics of Legal Process Outsourcing to India – Is the Practice of Law a ‘Noble Profession,’” or is it Just Another Business? – Aaron.R.Harmon