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EDITED EXCERPTS FROM THE PRELIMINARY REPORT AND
PRELIMINARY RECOMMENDATIONS ON THE UNMET LEGAL
NEEDS OF MODERATE-INCOME PERSONS IN MARYLAND,
PREPARED BY THE
MODERATE-INCOME ACCESS TO JUSTICE ADVISORY TASKFORCE

In this report we describe the inability to enforce the rule of law of many members of the 750,000 households in Maryland whose annual incomes are between $15,000 and $45,000. We rely upon our adversary system to resolve the many legal disputes that arise in our highly regulated society. The core assumption, however, that Maryland litigants have equal access to the legal representation that often is essential to balance the adversary process, is simply not true for many moderate income people.

In focusing on the legal needs of people who are above (often slightly) the free legal aid eligibility line, we do not ignore the unmet legal needs of the poor or the pro bono obligations of the private bar. Recently, Congress reduced the annual appropriation for indigent legal services in civil matters from more than $400,000,000 to less than $280,000,000, which amounts to about $7.00 for each poor person in the country. Congress also placed severe restrictions on these funds. A statewide committee is responding to this very real crisis. We will be called upon to do more in the future to provide civil legal services to the poor, and we will answer that call.

Moderate-income persons share both the types of legal problems the poor have and, often, their inability to obtain legal help.

Based on a statewide survey of consumers conducted by Mason-Dixon Political/Media Research and the results of four regional focus groups, we have reached the following conclusions.

We propose a variety of ways in which all the actors in the civil justice system might respond to this serious access to justice problem, including Maryland's legal profession, law schools, judiciary, executive branch and business and labor leaders. The Maryland legal profession must assume the leadership role. We cannot ask others to do more unless we do more ourselves.

Among others, we make the following preliminary recommendations.

Civil justice should be a right of citizenship, not a commodity that only the wealthy can afford. We are working hard to achieve this goal.

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PRELIMINARY REPORT AND PRELIMINARY RECOMMENDATIONS ON THE
UNMET LEGAL NEEDS OF MODERATE INCOME PERSONS IN MARYLAND

TO:

FROM:

June 12, 1996


TABLE OF CONTENTS

I. EXECUTIVE SUMMARY

II. BACKGROUND

III. PRELIMINARY FINDINGS

IV. PRELIMINARY RECOMMENDATIONS

CONCLUSION


I. EXECUTIVE SUMMARY

In this report we analyze a serious public problem: the inability of many members of the 750,000 or so moderate income households in Maryland to enforce the rule of law. We rely upon our adversary system to resolve the many legal disputes that arise in our highly regulated society. The core assumption, however, that Maryland litigants have equal access to the legal representation that often is essential to balance the adversary process, is simply not true for many moderate income people.

We propose a variety of ways in which all the actors in the civil justice system might respond to this access to justice problem, including Maryland's legal profession, law schools, judiciary, legislature, executive branch, and business and labor leaders. We propose a leadership role for the Maryland legal profession. We cannot ask others to do more unless we do more ourselves. The Maryland legal profession, acting through the State's bar association, continuing legal education program and our two law schools, has demonstrated its collective commitment to action by identifying the moderate-income access to justice problem, commissioning qualitative and quantitative studies to measure it and appointing our Taskforce.

This report is preliminary. Before we make final recommendations, we intend to talk further to many of the people who now are laboring to make justice a reality for moderate-income persons: for example, those who participate in local lawyer referral programs, reduced fee lawyer panels, legal information hotlines, courthouse- based legal information services, innovative educational courses, prepaid and group legal services plans, bar association committees, and other private and public sector access to justice initiatives. We intend to support, work with and build on these efforts, not to supplant or compete with them. The first step in this collaborative process is to listen carefully to the additional information and views of others.

We will distribute this preliminary report as widely as we can. We encourage any interested person to submit written comments to the Chair of the Taskforce by July 31st. We will hold a public hearing on September 9, 1996 to listen to testimony that will supplement the written comments that we receive. Thereafter, we will produce a final report.

In sum, these are our preliminary proposals:

We make other recommendations, as well, in Part IV of this report.

II. BACKGROUND

Before we turn to our Preliminary Findings (Part III) and Preliminary Recommendations (Part IV), we explain why and how the Taskforce was formed.

A. The Creation of the Taskforce

In early 1994, the Maryland State Bar Association ("MSBA"), the State's two law schools and the Maryland Institute for Continuing Professional Educations of Lawyers, Inc. ("MICPEL") joined together to initiate The Moderate Income Access To Justice Project. fn 1 The four partners had two goals: 1) to determine whether Maryland residents who have moderate incomes (which they roughly defined as an annual household gross income between $15,000 and $45,000) are able to obtain effective access to justice in civil cases; and 2) to identify ways in which the four project partners, the State and the private sector can help persons of moderate income to obtain the legal assistance they want and need.

In December, 1994, the four partners, acting through P. Dennis Belman, then President of the MSBA, appointed this Taskforce. Herbert S. Garten, a former President of the MSBA and the current Chair of the Board of the Maryland Legal Services Corporation, agreed to chair the Taskforce. Our members include private lawyers (including a number of lawyers in small firms and solo practices), public attorneys, judges and law professors in Maryland. fn 2

B. Our Focus on the Unmet Legal Needs of Persons Who Have Moderate Incomes

In focusing on the legal needs of people who do not qualify for free legal aid, we do not ignore the unmet legal needs of the poor or the pro bono obligations of the private bar. Through its courts, legislature, bar associations, private and public lawyers and law schools, Maryland has done much to provide legal help to the poor. fn 3 Recently, Congress reduced the annual appropriation for indigent legal services in civil matters from more than $400,000,000 to less than $280,000,000, which amounts to about $7.00 for each poor person in the country. Congress also placed severe restrictions on these funds. We will be called upon to do more in the future to provide civil legal services to the poor, and we will answer that call.

A statewide committee, the Maryland Coalition for Civil Justice, is now analyzing the Maryland legal services delivery system for the poor in response to today's crisis. The membership of the Coalition and our Taskforce overlaps, a number of us have attended many of the Coalition's meetings, and we have shared information with the Coalition. Although the Coalition has not yet issued its report, we expect that our Taskforce and the Coalition will make consistent, and in some respects interrelated proposals.

Maryland and national legal needs surveys, which we discuss below, establish that poor and moderate-income persons have very similar legal problems and a shared need for additional legal help. For far too long, the unmet legal needs of those two groups have been considered independently; in isolation from each other. We expect and intend that our recommendations, if implemented, will benefit the poor as well as moderate-income people. We are providing a copy of this report to the Coalition to identify ways in which we might further work together to achieve the access to justice goal for both populations.

III. PRELIMINARY FINDINGS

A. The Quantitative ABA National Survey Findings and
Maryland Mason-Dixon Survey Findings

Before the four project partners initiated this project, they knew from their collective experience that there were many people in Maryland whose incomes disqualified them for free legal aid, but who could not (or chose not to) seek legal assistance for significant legal problems. This impressionistic view was confirmed when, in March, 1994, the American Bar Association released its "Comprehensive Legal Needs Survey" of 3,087 of the nation's low to moderate income households, the results of which we summarize below.

The four project partners expected the central finding of the ABA's National Survey - that many moderate income people cannot obtain effective access to justice - to be generally applicable in Maryland. They did not know, however, the full extent and dimensions of the access to justice problem in Maryland. Therefore, the project partners commissioned a study to measure the unmet legal need in Maryland, retaining Mason-Dixon Political/Media Research, Inc. to conduct the study. Mason-Dixon conducted a statewide quantitative survey and convened four focus groups throughout the state to gather qualitative information.

The findings of the ABA National Survey and the Maryland Mason- Dixon Survey are consistent.

1. Moderate-income households in Maryland have an average of one legal problem per year. The ABA National Survey reported that approximately one-half of all households surveyed "faced some situation that raised a legal issue during the twelve months of 1992."fn 4 Mason-Dixon concluded that, in Maryland, "Marylanders whose income range is $15,000- $45,000 had [an average of] one legal problem in 1994." fn 5

2. Most moderate income people who have a legal problem do not seek help from either lawyers or the legal system. The ABA National Survey found that 61% of moderate income respondents who had legal problems had no interaction with the nation's legal justice systems. fn 6 In Maryland, Mason-Dixon found that 72% of those who had legal problems did not contact a lawyer. (Of those 28% who did contact a lawyer, 73% of them retained counsel.)

Two of the most frequent reasons offered by the Maryland respondents for not contacting a lawyer included cost and the lack of knowledge that the problem was a legal problem (or had a legal component).

However, the largest number of Maryland respondents who did not contact a lawyer (40%) gave "other/don't know" as their major "reason". There undoubtedly are a variety of factors subsumed in this residual category, including the reasons identified by the ABA National Survey for their respondents' decisions to avoid the justice system: "doubts that [seeking a remedy from the justice system] would help, ... a sense the problem was not serious enough, or the desire to handle matters on their own." fn 7

The American Bar Association's Commission on NonLawyer Practice, which heard extensive testimony about the "widespread refusal" of moderate income persons "to use the justice system," fn 8 attributed this to a number of factors:

3. Among the most common areas of unmet legal need are: consumer problems, housing problems, family and domestic problems and small business problems.

Chart 1 sets forth relevant Maryland data. fn 10

CHART 1


Legal Problem       % of Respondents    % of Those w/  % of Those
                    Who Had Problem     Problem That   Who Retained
                                        Contacted A    A Lawyer
                                        Lawyer

Housing                  15%            5% of 15%      0% of 15%

Employment               11%            46% of 11%     82% of 46%

Consumer                 11%            16% of 11%     27% of 16%

Family/Domestic Law      9%             59% of 9%      85% of 59%

Small Business           7%             22% of 7%      70% of 22%

Traffic/Minor            6%             37% of 6%      100% of 37%
Crim/Juv

Bankruptcy               6%             28% of 6%      60% of 28%

Environmental            6%             8% of 6%       67% of 8%

Special Education        6%             0% of 6%       0% of 0%

Personal Injury          5%             27% of 5%      75% of 27%

Civil Rights             5%             23% of 5%      86% of 23%

Health Care              5%             15% of 5%      80% of 15%

Tax Disputes             4%             35% of 4%      89% of 35%

Entitlements             3%             68% of 3%      46% of 68%

Real Estate              3%             16% of 3%      33% of 16%

Elder Law                2%             54% of 2%      86% of 54%

Wills & Adv.Dir.         1%             75% of 1%      100% of 75%

The ABA National Survey identified three of the four most prevalent legal needs of national respondents as "financial/consumer" (1st) (2d in the State survey); "housing/property" (2nd) (1st in the State survey); and "family/domestic" (4th) (4th in the State survey). The ABA National Survey identified "community/regional," a broad category of local legal problems, as the 3rd most prevalent legal need of those surveyed.

4. The most common source of client referrals to attorneys is informal: "friends" (ABA National Survey: 38%); "word of mouth" (Maryland Mason-Dixon Survey: 36%). Thus, both surveys confirmed that informal sources of referral are more important than formal sources and advertising.

5. Few lawyers give clients discrete task retainer options. Nine out of ten of the Maryland respondents (89%) reported that the lawyers whom they consulted did not give them the option of a reduced fee in return for the lawyer's handling only part of the legal problem.

6. Only one in ten Maryland households belongs to a prepaid legal plan or has insurance that covers legal services. Only 10% of those surveyed stated that they belonged to a prepaid legal plan or had insurance that covered legal expenses.

7. Only one in four Maryland households is aware of a mediation service in their area. Almost three-fourths of those surveyed in Maryland (73%) were not aware of any mediation service in their area that was available to resolve disputes without litigation.

B. The Maryland Mason-Dixon Focus Groups

In early 1995, a number of Maryland attorneys took part in four regional focus group discussions about how the legal profession is serving, or failing to serve, people who have incomes ranging from $15,000 to $45,000 a year. Arranged by region in groups of six to nine people, from the Eastern Shore, Southern Maryland, Central Maryland and Western Maryland, the focus groups included practicing attorneys and judges, as well as a paralegal and the head of a domestic violence program.

The focus groups generally agreed that access to justice is difficult for low and moderate-income people. Some potential clients must overcome an inability to pay a standard fee. For others, an equally significant barrier may be posed by public misapprehension of the legal system.

Some clients don't recognize at first that they have a ripening legal problem, or decide not to confront it, preferring to avoid the expense of lawyers. They may not realize that involving a lawyer early can save trouble and expense later. Or, if they contact a lawyer cold over the telephone, the initially quoted fee may deter them from retaining the lawyer. Potential clients may not realize that fee arrangements can be negotiated and reduced once they sit down with a lawyer.

The focus group participants identified, but did not necessarily agree upon, a variety of measures to increase access to justice. Many of these centered on education: both of low- and moderate- income persons and of the attorneys who aim to serve them.

The participants suggested that attorneys could be aided in serving such clients if a statewide database or software package were available to help them grasp complex areas of law more quickly and simplify application of the law. Attorneys might also then begin to recognize no-fee or low-fee work as a loss leader that can generate profitable work in the future.

The lawyers in the groups mentioned several ways the profession could deploy its services more effectively on behalf of moderate income clients. Some involved streamlining litigation or circumventing it altogether through a broader practice of alternative dispute resolution.

Other proposals focused on making lawyers more affordable. Referral panels should be interdisciplinary and capable of counseling clients not just on legal issues, but on family, social, psychological and other problems that they bring. Homebound and retired lawyers could be used more widely in referral of reduced- fee clients. The Maryland Bar could certify specialty practices. Senior lawyers could advise fledgling lawyers handling low-fee cases. Law students could serve as interns, similar to those in the medical profession, and take on low-fee cases that come to a particular firm.

We adopt in our preliminary recommendations many of these recommendations. We thank the focus groups' participants for their very helpful observations and recommendations.

IV. PRELIMINARY RECOMMENDATIONS

Our first recommendation is that this Taskforce remain in existence to consider the written comments of all interested parties, hold a public hearing, issue its final report and help the four project partners begin to implement the final Taskforce recommendations. We hope to complete our additional work within the next 18 months. We suggest timeframes for the various action items that fall within this 18 month period. When we do not recommend specific timeframes, we generally recommend that the proposed task be completed in 18 months.

We make and organize our recommendations in two general categories: A) recommendations that we believe would increase the quality and quantity of legal services that lawyers provide to moderate-income persons in the areas of documented unmet legal need; and B) recommendations that we believe would help unrepresented or partially represented moderate-income persons obtain more just and efficient resolutions of their disputes.

These two categories of recommendations are interrelated. For example, insofar as the Part B recommendations would simplify and streamline dispute resolution, they would make it more likely that people of moderate income could afford legal representation, thereby increasing the extent of legal representation, which is the goal of our Part A recommendations.

We subdivide these recommendations into two interrelated subcategories: 1) recommendations aimed at increasing the supply of needed legal services; and 2) recommendations aimed at providing moderate-income consumers with the information they need to make informed decisions about whether, when and how to retain a lawyer.

It is profoundly unfortunate, but a contemporary reality, that all people of moderate income who want legal assistance to assert or defend meritorious claims can not receive this basic help. We make several recommendations to make our formal dispute-resolution systems more readily available and user-friendly to partially represented and unrepresented parties.

CONCLUSION

We reiterate that our proposals are preliminary and we encourage all interested persons to submit written comments by July 31st to:

We will hold a public hearing on this report on September 9, 1996 in Room 101 of the University of Maryland School of Law, 500 W. Baltimore Street, Baltimore, Maryland (with a continuation date, if necessary, of September 11th). We invite all interested persons to attend and share their views with us. We urge all to submit their testimony in writing before September 9th.


FOOTNOTES

1. The State's law schools are the University of Baltimore School of Law and The University of Maryland School of Law. Initially, the Project was called "The Access to Justice Project." The four Project partners added "Moderate Income" to its name to more accurately identify the Project in light of its mission. BACK TO TEXT

2. We express our great appreciation to Michael Millemann, our fellow member and Reporter, for his hard and excellent work in preparing this report. Professor Millemann is the Jacob A. France Professor of Public Interest Law and Director of the Clinical Law Program at the University of Maryland School of Law. BACK TO TEXT

3. In 1981, The Maryland General Assembly was one of the first states to adopt an Interest On Lawyers' Trust Accounts Program, which pools lawyers' trust accounts that are too small and are held for too short a time to produce interest income for clients. The 1981 Maryland General Assembly also created the Maryland Legal Services Corporation to distribute the $1,000,000 in annual IOLTA interest income to legal aid programs.

In 1987, the Advisory Council of The Maryland Legal Services Corporation, known as the "Cardin Commission" in honor of Congressman Benjamin Cardin who chaired it, made a series of recommendations that led to the expansion of lawyer volunteer efforts and the enactment of a comprehensive IOLTA Program, which now produces approximately $3.5 million a year. In response to the Cardin Commission's recommendations, the MSBA established the People's Pro Bono Action Center, Inc. that, with the help of the Maryland Court of Appeals, has increased the level of pro bono legal services in the State of Maryland from 1,688 in 1989, to 5,600 in 1994.

The Cardin Commission also recommended that the State law schools require their students to provide civil legal services to the poor as a condition of graduation. With the help of Congressman Cardin, both law schools significantly expanded their clinical law programs, through which second or third year law students provide legal services to the poor. The University of Maryland School of Law requires all its day division students to provide legal help to the poor as a condition of graduation. BACK TO TEXT

4. A.B.A. Consortium on Legal Services, Legal Needs and Civil Justice: A Survey of Americans - Major Findings from the Comprehensive Legal Needs Study (1994) ("ABA National Survey.") BACK TO TEXT

5. Mason-Dixon Political/Media Research, Inc., Maryland Legal Needs Assessment Survey 5 (February 1995) ("Maryland Mason-Dixon Survey"). BACK TO TEXT

6. ABA National Survey, supra note 3 at 12. BACK TO TEXT

7. A.B.A. Consortium on Legal Services and the Public, Agenda for Access: The American People and Civil Justice at xiii (February 1996) ("ABA Final Report.")

We acknowledge that the general mistrust of lawyers and the understandable fear of litigation may have contributed to a number of the "other/don't know" responses. Public criticism of the legal profession is timeless and enduring. However, when clients are asked to rate their own lawyers, as opposed to lawyers in general, there is a significantly higher degree of satisfaction. The ABA Comprehensive Legal Needs Survey concluded that "[t]he overwhelming majority of those having turned to a lawyer rate that advocate highly on such attributes as honesty and attentiveness to the client." ABA National Survey (note 3), at 24.

When clients do criticize their lawyers, they often are criticizing our adversary process as well. In February, 1996, Consumer Reports reported the results of its survey of lawyers, to which approximately 30,000 readers responded. "In cases that involve no adversary, almost three-fourths of our readers were highly satisfied", it said. When You Need a Lawyer, Consumer Reports, February 1996 at 34, 37. In comparison, about one-half of the Consumer Reports readers were "highly satisfied" with their lawyers in adversary proceedings. More than one in four of the respondents who were represented in adversarial proceedings expressed dissatisfaction - "somewhat, very, or completely" - with "the speed with which their case was handled, how well their lawyer kept them informed, or fees." Id. The greatest levels of client dissatisfaction were in divorce and child custody cases.

These data suggest that we must address the access to justice problem not only by providing more efficient representation to unserved clients, but also by giving clients alternatives to the adversary process and improving the efficiency and fairness of that process. See Part IV, Recommendations. BACK TO TEXT

8. A.B.A. Commission on NonLawyer Practice, NonLawyer Activity and Law Related Situations: A Report With Recommendations at 4 (August 1995)("ABA Nonlawyer Activity Report"). BACK TO TEXT

9. Id. at 4-5. The Taskforce, working with the University of Baltimore's Merrik School of Business, is gathering and analyzing additional information to better understand the "other/don't know" answer that 40% of the Maryland respondents who had legal problems gave to the "why didn't you contact a lawyer" question. BACK TO TEXT

10. See Maryland Mason Dixon Survey (note 5), at 5. BACK TO TEXT

11. Mike France, Legal Clinics: Lights Go Out for Storefronts, The Nat'l L. J., December 12, 1994, at A1, A24. BACK TO TEXT

12. Id. at A24. A commission of the New York State Bar Association that investigated the growth and decline of legal clinics in New York reported that "even the largest of them has now drastically reduced the size and scope of its practice and has concentrated its emphasis almost completely in personal injury litigation." New York State Bar Commission on Providing Access to Legal Services for Middle Income Consumers, Report and Recommendations to the House of Delegates 1, 4-5 (April 1996). BACK TO TEXT

13. In 1972, the year that Jacoby & Meyers opened its first office in California, only 20,485 new attorneys were admitted to practice nationally. In 1992, 54,577 new attorneys were admitted. Id. at A24. BACK TO TEXT

14. Id. at A24. BACK TO TEXT

15. Part of the research task will be to determine the interplay between that portion of Rule 7.3(3) that is quoted above and Section 13-206(a) of Maryland's Commercial Law Article, which defines a "legal assistance organization" to mean "a firm, group, corporation, or other entity which recommends, furnishes, arranges, or pays for legal services for its own members or beneficiaries, whether or not for profit". This statute was enacted in 1977. Rule 7.3(3) became effective in 1987. BACK TO TEXT

16. Bradley A. Kukuk, Like HMO's, Prepaid Legal Plans Serving More of the Population, The Daily Record, March 23, 1996, at 1, 8-9. BACK TO TEXT

17. Id. BACK TO TEXT

18. See Mike France, supra note 12 at A24 (citing National Resource Center for Consumers of Legal Services). BACK TO TEXT

19. Maryland Rules of Professional Conduct, Rule 7.3(3) (1995). BACK TO TEXT

20. Proposed Model Rules of Professional Conduct, Rule 7.3. BACK TO TEXT

21. Forrest S. Mosten, Unbundling of Legal Services and the Family Lawyer, 28 Fam. L. Q. 421, 427 (No. 3, 1994)(citing the American Bar Association Standing Committee on the Delivery of Legal Services, Responding to the Needs of the Self- represented Divorce Litigants (1994)). BACK TO TEXT

22. A.B.A. Standing Committee on the Delivery of Legal Services, Responding to the Needs of the Self-Represented Divorce Litigant (1994). BACK TO TEXT

23. Id. See also Leigh Perkins, "Unbundling" Your Services Make Some Clients Happy, 1995 LWUSA 1181-83 (December 18, 1995).

The discrete task approach is being used, and has been recommended in other countries. In June 1995, The Right Honorable Lord Woolf issued an Interim Report to England's Lord Chancellor, the rough equivalent of our United States Attorney General, in which, among many other recommendations, he said:

The Right Honorable Lord Woolf, Access to Justice: Interim Report to the Lord Chancellor on the Civil Justice System in England and Wales, Section IV, Paragraphs 39 and 40 (1995). BACK TO TEXT

24. See Cal. State Bar Comm. on Professional Responsibility, Formal Op. 131 (1993). BACK TO TEXT

25. Los Angeles County Bar Association's Professional Responsibility and Ethics Comm., Ethics Opinion 483 (reprinted in The Los Angeles Lawyer, February 1996). BACK TO TEXT

26. ABA Final Report (note 7), at 21. BACK TO TEXT

27. ABA Final Report (note 7) at 27. BACK TO TEXT

28. ABA Final Report (note 7), at 24. BACK TO TEXT

29. Sandy Banisky, Arizonans Get Legal Aid In A Jiffy - By Computer, The Baltimore Sun at 1, 5A (April 8, 1996). BACK TO TEXT

30. Initial evaluations of the Multi-Door Courthouse in Houston, as well as similar projects in Washington, D.C. and Tulsa, Oklahoma, "show that 90 percent of the clients using the intake system are satisfied and 92 percent indicated they would use the program again." New York State Bar Commission on Providing Access to Legal Services for Middle Income Consumers, Report and Recommendations to the House of Delegates 1, 25 (April 1996). BACK TO TEXT

31. Report on The University of Maryland School of Law's Family-Law Assisted Pro Se Project in Anne Arundel and Montgomery Counties, and Recommendations (June, 1996). BACK TO TEXT

32. In a recent opinion, J. Joseph Curran, Jr., Maryland's Attorney General, concluded that a lay advocate could provide "basic information about the existence of legal rights and remedies" and "about the manner in which judicial proceedings are conducted", but may not provide either "advice" about whether one person's "particular circumstances suggest that she should pursue a particular remedy" or information, in the nature of advice, "about the legal aspects of judicial proceedings, such as how to present a case, call witnesses, introduce evidence, and the like." A lay advocate may help one "prepare a legal pleading or other legal document on her own behalf by defining unfamiliar terms on a form, explaining where on a form the victim is to provide certain information, and if necessary, transcribing or otherwise recording the victim's own words verbatim." But the lay advoca