Thursday, 19 January 2012

96th session of the Philosophical Foundations of Law and Finance (Friday 20, 6-8pm, Room 516, Regent Campus, University of Westminster)

Dear All,

For the 96th session of the Philosophical Foundations of Law and Finance I am taking the stage to share with you some thoughts that are related to my research on the intermediated holding system. Don't be put off by the term since I am very keen to spare you the technicalities of it and of an entire system that lies underneath. Instead I am planning to discuss with you a paper from Robert K. Merton, one of the most famous sociologists of the 20th century, entitled the Unanticipated Consequences of the Purposeful Social Actions, a subject with which Merton become obsessed for the years to follow. As one of most impressive bits, Merton wrote this very simple but at the same time clear and challenging paper (influenced by Frank H. Knight) in 1936, still fresh from his graduation. After 76 years the Mertonian factors that lead to the unanticipated consequences remain unchallenged while inexplicably his impact on the legal theories appears to be weak.

During the session I will focus on the five categories of factors that according to Merton lead to the unanticipated consequences of the purposeful social actions i.e. (i) the lack of knowledge (ignorance), (ii) the error, (iii) the imperious immediacy of interest, (iv) the basic values, and (v) the self-fulfilling and self-defeating prophecy. These categories appear to encapsulate many later findings from different sciences, but from the economics and its branch of the behavioural economics. I would even speculate that the above categories can be translated into asymmetries such as (i) the information asymmetry (developed by Akerlof and Spitzer to name a few), (ii) the perception asymmetry (e.g. due to emotional or cognitive biases, mostly developed by the behavioural economics and psychology), (iii) the interest asymmetry (e.g. the self-serving bias of bureaucrats, the capture theory, mostly developed by the neoclassical economists), (iv) the belief asymmetry (e.g. self-destructive blind belief in ideologies or fundamentals without recognition of their limits) and (v) the persuasion asymmetry (e.g. herd behaviour).  

I would be very interested to hear your thoughts on the above and would be very pleased if we can turn this session into a challenging but also entertaining discussion. 

Regards, Rezi


Friday, 13 January 2012

95th Session of Philosophical Foundations of Law and Finance

Dear all, 

Philosophical Foundations of Law and Finance will be held tonight in Room 516, Regent Campus, University of Westminster, from 6 to 8pm. The lecture topic will be the UK Anti-Bribery Act. 

Arwa Alissa, LLM and PhD candidate, has volunteered to organise a "formal dinner & networking club" once per month or so. She'll need help to arrange invitations, speakers, sponsors etc. Any volunteers? 

I'd like to change our name after the 100th session. Maybe the Philosophy, Law and Finance Research Symposium? After lecture, dinner at Galleria, Marylebone. 

Please spread the word to our friends in the investment banks, law firms and governments. It's difficult for singletons in these professions to find others that they can really trust. Wonder why [sarcasm on]. Did you know that at least two of our former members used the Philosophical Foundation of Law and Finance meetings and dinners to get to know each other, then got engaged and are now married? I say "at least two" because i leave out all the clandestine liaisons that i know. Ha, as if such behaviours can be hidden from the ancient mischievous Master! The Philosophical Foundations of Law and Finance has served a socio-biological purpose. Fecundity and felicitations, Baby!


Wednesday, 11 January 2012

The Future of Legal Education...?

(Thanks, with twist, New Yorker)


Monday, 9 January 2012

Is the Axis of Legal Education Shifting to the East?

(Singapore old and new)
I've been researching the global context of legal education recently and the competition is becoming intense. The usual suspects are UK and US law schools, which compete for overseas students especially at the graduate level. Carole Silver has studied this area extensively.

However, I suspect we shall see the competition take on a new dimension. One finding of my research is that US-style legal education is being adopted in more and more countries notably in Asia, eg, China, Japan, and Korea. This is not so much to do with the superior quality of American legal education but rather its perceived emphasis on practice not theory. This is why in China the Ministry of Justice promotes the JM degree while the Education Ministry hews to the LLB.
Even the increasing pursuit of dual degrees depends on a reliance on US law schools, eg, Osgoode Hall/NYU, Windsor/Detroit Mercy, Cornell/Sorbonne. However, there is a new move afoot.

The National University of Singapore (NUS) has had a long term tie with NYU but is now branching out to make itself a legal education hub for Asia. NUS has started a collaboration with Yale for double degrees in law and environment so that candidates can graduate with either a bachelor's degree from NUS or a master's from Yale Law School.

However, it is NUS's latest tie-up that is most interesting. It has signed an MOU with Tsinghua University in China for a 3+1 degree where students graduate with both an LLB and an LLM. Let's add into the mix Peking University Law School's LLM in Chinese Law which is taught in English, Tsinghua University Law School's LLM also taught in English, the Peking University School of Transnational Law (a member of LWOW) which teaches joint JD and JM law programs and we have a developing maturity of legal education that stands in competition with the UK and the US.

These schools realize they are part of a global community, not a parochial one as most US, and UK, law schools remain.  What is intriguing is how explicit they are. NUS depicts itself as a global university which will
Ensure its position as one of the world's leading universities, whose faculty are committed to research with global impact, through focusing on issues of global import and through global collaborations
Secure recognition as a great university of the highest global standing and play a leadership role in the Asian region as the pre-eminent university in Asia.
India is developing along these lines with the Jindal Global Law School which shares a global vision much like that of NUS. How many western universities have such an overt and explicit global strategy?

It is hypothesized that as Asia becomes stronger and more powerful it will become the hub of financial markets and more. This is quite possible as there is nothing secure in being a financial hub. In the last 300 years that honour has been shared by Paris, Amsterdam, Berlin, London and New York.

It now looks as though legal education's hub could be shifted from the west to the east as well. Asia is prepared to think big and strategically. Both the ABA and the UK Legal Education and Training Review need to consider this as they plan their revisions. The question is will they do so?


One more item can be thrown into the mix here. MIT's new initiative MITx. MIT says
MIT will make the MITx open learning software available free of cost, so that others — whether other universities or different educational institutions, such as K-12 school systems — can leverage the same software for their online education offerings.
True, you don't get an MIT degree but you will get a certificate from MIT that says you have completed the course. Imagine, if you will, law were to be offered the same way......


Friday, 6 January 2012

PI(I)GS Might Fly!


The Troika is upsetting big bar associations because it is demanding the liberalization of professions in countries it is bailing out. Key complainers are the American Bar Association and the CCBE. (Thanks to Peter Lederer for the H/T).

The Wall Street Journal Law Blog reported that the ABA and CCBE have written a letter to Christine Lagarde, head of the International Monetary Fund and former head of the world's largest law firm, Baker & McKenzie, asking her to pass on their concerns at the end of independence of the bar to the heads of the European Union and the European Central Bank.

The WSJ Law Blog says:
The American Bar Association and the Council of Bars and Law Societies of Europe say measures in Ireland, Greece and Portugal threaten “one of the core principles of the legal profession: regulation independent from the executive branch of the state.” 
Although only three countries are listed we know it won't be long before Italy is included once it receives its subvention from the Troika.

I've analyzed some of this before and it's clear that the Troika isn't signalling the death of the legal profession. Far from it, it is demanding proper regulation and accountability which lawyers have avoided. Colin Scott, dean of UCD Law School, cogently argues:
It is not unprecedented for government to appoint independent regulators to oversee the legal is normal for independent regulators within our system of democratic governance to be subject to a variety of mechanisms of accountability to ministers, not least to provide reassurance that the regulator will not be captured by those it is set up to regulate. Few are wholly independent in a modern state better characterised as exhibiting characteristics of interdependence. As an example, the legal profession is dependent on the state for fees across much of the criminal justice system and in respect of many civil matters too. No one argues that the taking of instructions and fees from government compromises the professional independence of lawyers.
There are two strands to the Troika's thinking on the legal profession and professions more generally. The first is proper regulation as Colin Scott refers to above. (And, in the case of Ireland, for example, the Justice minister is being responsive to concerns.) The second is that in many countries the professions are closed off from many who would like to participate. Not because they are incapable but because they don't possess the social capital that enables them to enter and practice. (Ample cites on professional closure here.)

The Troika's moves are an attempt to open up the labour market so it is accessible to all not just a few. One only has to look at how many law firms in continental Europe are dynastic family organizations.

Unfortunately, when the ABA and CCBE says
Bars and Law Societies around the world have always been open to reform: they follow very closely societal, economic and any other changes within their own countries and worldwide, evaluate the impact of these changes on the profession and take the necessary steps to adapt.
 it is very hard to believe them. I don't think the IMF will budge and nor should it.


Tuesday, 3 January 2012

The ABS Race is On!...Almost...

(thanks to Rocking Horse Works)

Today's the day the Solicitors Regulation Authority (SRA) belatedly began accepting applications from those who want to become Alternative Business Structures. It was meant to be last October 6, but the SRA hadn't quite got to the cantering stage then. Now it's trotting along.

According to Legal Week there have been 15 licence applications including Irwin Mitchell, which wants to take external investment, and Cooperative Legal Services which wants to integrate its legal practice under the Coop umbrella.

About 10 applicants are serious and although the process can take 6 months some applications will be processed earlier. The SRA says it will be rigorous
"For example, we'll be asking for the employment history of everyone going back five years - we need to have detailed information relating to those who want to be regulated by us."
Others for ABS conversion may be Claims Direct, a claims management firm on a no win-no fee basis, which is owned by Russell Jones & Walker.  And Solicitors Journal says
Other likely contenders include LEGAL365, the legal business set up by Freeserve founder Ajaz Ahmed with law firm Last Cawthra Feather, and In-Deed, the conveyancing service set up by Rightmove founder Harry Hill, who revealed last month that he would be buying up law firms.
Both LEGAL365 and In-Deed are online legal services providers and this form makes perfect sense. It will be interesting to see if other online providers, eg, Legal Zoom or Epoq Legal, move this way.

Well, it has been a slow start. Unlike the Big Bang of 1980s financial services, no equivalent explosion has occurred in legal services. In fact it has been rather a damp squib which has the potential to become a sparkler that might graduate to a firework bang in the future. 2012 should give us the picture.

What won't be clear is the effect on the delivery of legal services. Most analysis, for example that by Susskind, focuses on what lawyers will do or won't do. It doesn't say much about access to justice and whether we can look for an increase in legal services. One of the questions here is the carving out of the market with the potential that many might not get access to legal services, for example, those on benefits or unemployed.

I have not yet seen anything about say the pro bono commitments of ABS. Now there is a difference between corporate social responsibility and pro bono, although many lawyers confuse the two. But there is no reason why good CSR policies can't include commitments to pro bono. I hope so.

This is terrifically hard to do as the Kutak Commission on legal ethics in the US in the 1980s found when it proposed a mandatory 40 hour per year pro bono commitment. Outrage and uproar. It never happened.

Perhaps what we need is a pro bono index like a stock market index so we can track pro bono and share prices. Who knows, there could even be a healthy correlation, dare I even say causal link... OK, that's pushing it too far.